Globalisation comprises all those processes by which the people of the world are incorporated in a single world society. Globalisation was not born overnight. It is a process. At least three distinct historic processes or stages of globalisation have to be looked into.
The first long phase of globalisation was characterised by colonial imperialism.
The second phase is marked by international concern for human rights and standards of international justice which will sharpen the arrogance of sovereign power everywhere.
The third phase of globalisation running alongwith the second phase has been marked by a steady rise of the forces a late capitalism, manifesting multinational hegemony and the dominance of international financial institutions, both emerging as centres of authority.
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Thus globalisation has given a new impetus to the international economic process. The Multi-National Corporations are in the drivers seat during the phase marked by the triumph of global market economy.
Globalisation is not a replica of classical liberalism. It is an improved version of it. It believes in free trade, free market and free investment. It also believes in limited role of the state and government as well as the international organisations.
The concept of globalisation stands for subordinating domestic capital to international finance capital by making its movements free across political boundaries of the nation- states. The tying up of national finance with international finance is to be supplemented by the tying up of national policies with the economic policies as laid down by the World Bank and International Monetary Fund. These economic policies, irrespective of the level of development, material differences and the nature of government, should conform to a process of globalisation where the closed domestic economy may be adapted to the current tide of the world economy, a process of ‘stabilisation’ which involves removal of certain perpetual constraints, a process of ‘privatisation’ to maintain quality of the product and a process of ‘liberalisation’ to allow free trade and commerce, free market and free flow of capital by allowing the multinationals to enter a national economy.
Thus globalisation is mostly understood in economic terms. The term signifies a market-driven economy in which finance capital, floating seemingly unhindered across national frontiers, currencies and continents, occupies a pre-ponderant position over productive as well as local or national based capital. The chief agents are globally operating transnational corporations and international finance institutions which are grounded in the capitalist world. Globalisation is a qualitative and not a quantitative term. It is a multi-level phenomenon. It also affects the role of the sovereign state.