The correct option is 2 only
Explanation
Globalization refers to the integration of the domestic economy with the global economy through the cross-border flow of trade, capital, and technology. In the Indian context, the economic reforms of 1991 opened the market to foreign competition, significantly impacting domestic industries.
Statement-wise Analysis:
- Statement 1 is Incorrect: The entry of Multinational Corporations (MNCs) and the reduction of trade barriers increased competition in the Indian market. To survive and thrive, top Indian companies were compelled to invest in newer technology, adopt modern production methods, and raise their production standards to global levels.
- Statement 2 is Correct: The statement claims that collaborations have "uniformly resulted in losses," which is factually wrong. Many Indian companies have successfully collaborated with foreign companies to gain access to advanced technology and global markets (e.g., the joint venture between Maruti and Suzuki). These collaborations have often been profitable and beneficial for Indian firms.
- Statement 3 is Incorrect: The assertion that "all" Indian companies have been unable to compete and have shut down is an extreme exaggeration. While some smaller units faced challenges due to competition, many large Indian companies (such as Tata Motors, Infosys, Ranbaxy, and Asian Paints) successfully adapted to the competition and emerged as multinationals themselves.
Key Takeaway:
Globalization has a mixed impact; while it poses challenges for smaller, less efficient units, it drives larger domestic firms to modernize, improve efficiency, and expand their global footprint.