The global trade
There is an ad for DHL which shows how different materials required to make a blouse are acquired from different countries and how the final finished product is bought by a girl called Annie in USA.
I had a similar experience recently. My cousin brother came to India from Boston, USA. He gave me a Reebok cap which had some NFL (I guess) team called Vikings' logo on it.
Inside the cap I found a tag which said that the cap was made in BANGLADESH.
Bangladesh is right next to India, I also learnt that India exports a lot of stuff to Bangladesh which includes clothes material.
So the cap made in Bangladesh could have some base material from India itself. The Cap would have been made by some poor tailor in some little hell hole in Bangladesh and it would have been sent to USA and finally billed for 22 Dollars. And this great product was bought in America by my cousin and then gifted to me.
When 22$ is converted to Indian rupees, it comes to around 970Rs. I can approximate it to 1000Rs.
In reality the product will hardly be 50 - 100 Rs worth, as the mass production of it will obviously bring down the price.
But what kind of salary would that tailor have got for this 1000Rs worth product, not even 10Rs.
You must probably think what is my point now ??? Well my point is the global trade agreements have created a very large difference between the under developed countries and the developed countries.
The developed countries are making huge profits, of course there have been some good things because of such free trade but I still feel the benefits are not evenly spread.
Anyway the Cap is really nice and I do like it, but I just am amazed that it was made in my neighboring country but bought in the USA.
I had a similar experience recently. My cousin brother came to India from Boston, USA. He gave me a Reebok cap which had some NFL (I guess) team called Vikings' logo on it.
Inside the cap I found a tag which said that the cap was made in BANGLADESH.
Bangladesh is right next to India, I also learnt that India exports a lot of stuff to Bangladesh which includes clothes material.
So the cap made in Bangladesh could have some base material from India itself. The Cap would have been made by some poor tailor in some little hell hole in Bangladesh and it would have been sent to USA and finally billed for 22 Dollars. And this great product was bought in America by my cousin and then gifted to me.
When 22$ is converted to Indian rupees, it comes to around 970Rs. I can approximate it to 1000Rs.
In reality the product will hardly be 50 - 100 Rs worth, as the mass production of it will obviously bring down the price.
But what kind of salary would that tailor have got for this 1000Rs worth product, not even 10Rs.
You must probably think what is my point now ??? Well my point is the global trade agreements have created a very large difference between the under developed countries and the developed countries.
The developed countries are making huge profits, of course there have been some good things because of such free trade but I still feel the benefits are not evenly spread.
Anyway the Cap is really nice and I do like it, but I just am amazed that it was made in my neighboring country but bought in the USA.
posted by ssk | 1:05 AM
2 Comments:
Cant really say trade agreements have created more polarity.They have infact opened up scope for more labor in developing countries.Doesnt make sense to compare the profits the US companies make with what it costs to manufacture or to pay the labourer.Eariler,the labourer didnt even have a job.Now he does,and with whatever he is paid,he is probably better off in his economy than earlier. However,there is some point in your argument about polarity being created due to free trade agreements. But this is more at a macroeconomic level. Take the case of Mauritius and India which signed the FTA as part of South Asian countries.The volume of goods that flows out of India is harldy 0.1% in dollar terms when compared to what comes into India from Mauritius which means Mauritius is actually getting benefitted at India's expense while India isnt using this agreement to its labour force's advantage,maybe to the buyer's advantage.
Subbu
@ Subbu
Dude I certainly cannot agree that it has created new jobs.. the reason ur giving is the same that the East India company can give after they subjugated us. See the point is the labour conditions shud be similar to the one in the USA , but it is not; people work like slaves and get very little.
And the same Reebok cap wud cost about 600 - 1000RS if bought in India.. why should we pay so much for such an item ?
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