Trade Balance in Foreign Countries

There is no doubt that increasing in international trade is supporting the economic growth across the world, raising incomes and creating jobs. However, international trade can also some create economic obstacles, such as the international context and the market policy and regulations of each country, and consequently it can be said that the effects would have positive and negative sides, and it is useful to mention all of them and to take them into consideration.

Trade is how goods or services are exchanged between countries. An exchange is broken down into two categories: imports and exports. Imports are goods and services coming into a country; whereas, goods and services flowing out of a country are exports. When different countries trade with each other, they develop a trade deficit, a trade surplus, or a trade balance. A trade deficit is when the value of imports exceeds the value of exports, and a trade surplus is when the value of exports exceeds the value of imports. A trade balance is when imports and exports are traded at equal rates/amounts.

In the midst of the help from the extremely advanced transportation, modern production methods, rapid industrialization and the increasing facilities of outsourcing of trade and services the international trade organization is increasing and decreasing very fast in the globe. The international trade account has a good distribute of a country’s gross on domestic product. It is in addition one of most important foundations of income designed for the developed as well as to developing country. For the reason that of many country benefits from the international trade approximately every one in the

Discretionary fiscal policy is the deliberate use of changes in government spending and/or taxes to alter

Kumar (1996) compares trends/fluctuations in key macro-economic variables in India pre and post 1991, both before and after initiation of new Indian economic policy in '91. These reforms included, amongst other things, the opening up of the Indian economy for international trade (prior to this India was a socialist state not involved in these markets) plus investment and heavy de-regulation processes. These particular changes to this policy allow for great insight into the impact of de-regulated, international capital trade on previously effective macro-management. He observes that this new economic policy increased economic instability which facilitates speculative activity, particularly resulting from financial sector liberalisation and the opening up of the economy. He adds that the observed increased volatility in economic fluctuations is a result from state intervention under these new economic policies that have reduced policy effectiveness. To quote: "The NEP not only lay greater stress on market forces but on opening up of the economy to foreign capital. This imposes constraints on policies since government cannot control the external environment which is governed by international finance capital- a force far more powerful than the Indian state hence able to dictate to it". He argues that since the interest of

Fiscal policy is the use of changes in government expenditures and taxes to alter national economic variables.

Most economies are open, which means interactions in trade and finance with other countries. Trade is buying and selling products or services. If an individual or country has an absolute advantage over another, this is the ability to produce more of a good or service using the same number of resources available. If an individual or country has a comparative advantage over another, this is the ability to produce a good or service at a lower cost than others. Possessing a comparative advantage in trade is very important because, an individual or country can produce a product or service and make more money on that item or service. The individual or country can than import other items the individual or country does not have or does not make as much profit on. Maximizing profits is most important for an individual or country, and trading to obtain other items is good business.

A trade surplus occurs when there is positive difference between the United States savings and investments. This means that the United States in this instance has exported more than it has imported to the rest of the world. A positive current account also suggests that the United States’ net assets will be increased by $2,399 million. The capital account deficit implies that there is money flowing out of the United States and that the nation is increasing its ownership of foreign assets. The surplus in the current account exceeds the capital account deficit; therefore, the balance in the reserve account should be $2,484. It is important to mention that this figure includes the possibility of small errors and omissions.

For India to become a major player in world trade, an all encompassing, and comprehensive view needs to be taken for the overall development of the country's foreign trade. While increase in exports is of vital importance, we have also to facilitate those imports which are required to stimulate our economy. Coherence and consistency among trade and other economic policies is important for maximizing the contribution of such policies to development. Thus, while incorporating the existing practice of enunciating an annual Exim Policy, it is necessary to go much beyond and take an integrated approach to the developmental

The current account is an important component of the balance of trade system of our country. It is a measurement of a country’s trade where the value of the goods and services it exports. A current account deficit represents negative sales abroad. A country undergoing current account deficit results in foreign liabilities and debt with the rest of the world. This further leads to payback of foreign current account reserves. Current Account includes imports and exports of goods and services and unilateral transfers of goods and services. Current account deficit in simple words is the economic situation when the total imports are more than the exports. This means that the country is importing more than exporting which requires the country to pay for the goods and services it imports. This leads to an unfavorable economic situation. The present record is a

A current account deficit can arise for several reasons. In some economies, it can be due to poor planning and uncontrolled spending, particularly government-run budget deficits. However, more often than not, a current account deficit is furnished to foster future economic development and growth. Understanding whether or not an economy’s CAD is “bad” is requires understanding its origins and influences.

By looking at the export and import data published by the Department of Commerce, Government of India, we can see that India has a current account deficit compared to that of Thailand. At the same time, evidently, Thailand has a current account surplus compared to that of India. India’s trade balance has been fluctuating slightly for the last five

The Untied States is one of the largest exporters in the world. They are the world’s third-largest exporters. In 2015 the United States total trade with foreign countries was 4.99 trillion. They imported more than they exported. That’s a huge issue we are facing here in the United States. We have a negative balance of trade, also known as a trade deficit since our imports are greater. We exported 2.23 trillion and imported 2.76 trillion. For these reasons, it has been blamed that it is destroying our economy and the caused for having a lack of jobs. People are blaming imports for their lost of jobs. It is cheaper to produce other materials in other countries because they have more access to other natural resources than we do. They don’t understand the importance to have a trade balance.

barriers for imports and exports between each other may be a possible threat to India’s United Kingdom market. Since the UK can virtually import anything from its neighboring countries without any cost, it might affect the demand of cashew nuts –the Europeans may divert their attention from cashew nuts to other products popular in its neighboring countries. India’s competitiveness could also be threatened by

A decline in value of Euro followed by the crisis in Euro Zone is likely to have a negative effect on India’s export to European region, which accounts for around 18% - 19% of India’s total leather exports. The exports from key areas like Leather and Gems & Jewellery, which holds a major contribution in India’s total exports to the region were said to have witnessed a negative effect in the initial months of the current fiscal due to the Euro Zone crisis.