International Trade
International Business

Importance of International Trade

International Trade has set its milestone in the earliest civilization when the trading started taking place but in rapidly changing times we see a different scenario.

Foreign trade is considered very important as it plays a crucial role in rising the living standards, generating employment, establishing relationships with countries and contributing a share in GDP.

Nations trading its goods and services with one another are stronger together than doing it all alone by themselves.

Monetary exchange of goods and services is known as Trade and when it is done outside the geographical boundaries of a country, it is called ‘International Trade.


Importance of International Trade


  • Full utilization of resources

Underdeveloped countries export the raw materials as they are unable to make full utilization of their resources to developed countries who need these raw materials the most.

In this manner resources are fully utilized.

  • Service sector trade

Increase in service sector trade means increase in banking, insurance, IT services, etc. International trade creates opportunities for increasing the service sector trade.

  • Get rid of surplus production

Sometimes a country’s production exceeds than the actual requirements so it gets rid of its surplus production by selling it to other countries who are in need.

This is also done to avoid occurrence of deflationary situations.

  • Competitiveness

International trade stimulates healthy competition among different countries as well as entrepreneurs who take initiate to advance technology, provide quality product at low cost and opt for latest and new techniques in comparison with other competitive companies.

  • Mutual cooperation

Most importantly, International trade promotes mutual cooperation among the trading countries and builds an amiable environment to establish good terms between nations, directing all towards world peace.

  • Great choices for consumers

Customers are highly benefitted from the choices of differentiated products, a humongous variety of products and services to choose from. For example:- Dominos, Gucci, Mercedes car, etc.

  • Global growth

It is basically creating a bridge between producers and consumers across the globe, so if the exporter is benefited then the importer will also be benefited, therefore helping each other’s country to grow globally.

  • Economic development

It has a great contribution in developing country’s economy especially in the south east asian countries who confronted the problem of poor economy.

In all, International Trade benefits all the nations in creating healthy competition, building friendly relationships, increasing service sector trade, developing economic growth and stimulating mutual cooperation.

It is extremely important not only for producers but also for the nations regarding their well being and stability of the economy.

“A nation that would enrich itself by Foreign Trade is certainly most likely to do so when its neighbours are all rich, industrious and commercial nations”- said by ADAM SMITH

Digital Exim will help in establishing your business standards according to international level, enhancing your brand’s digital presence, making you capable of competing in the foreign markets and helping in finding buyers according to your product or service.

So let us connect, collaborate and trade!


Kavit Shah

Founder of Impexperts & Digital EximSharing the 33+ years of experience in the Exim Industry, with the aim to help every Indian Entrepreneur achieve their Business Goal!

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