Economics XII Content
Meaning of international trade
International trade is defined as the buying and selling of goods and services between two or more countries. It simply means export and import. In export, there is outflow of goods and services but inflow of money. In import, there is inflow of goods and services but outflow of money. On the basis of export and import, any country may be in surplus or deficit. International trades between countries and across continents have existed for centuries. Traditionally international trade consisted of goods like textile, food items, precious metals and stones, and objects of art and various other items. We have come a long way since the earlier times and International trade today has taken on new dimension. It was a fact earlier that trade between two countries was not limited to economic activity alone but was an extension to political and social ambitions. In this modern time, with the advancement of technology and globalization, it is necessary for all countries to engage in international trade for their survival.