1. Foreign trade dependence creates serious difficulties for a country, especially in times of war when foreign trade becomes impossible.
  2. Because of foreign trade, a country may recklessly exhaust her limited natural resources for the purpose of export without thinking of her own future needs.
  3. Foreign trade gives rise to foreign competition. Foreign competition may ruin  domestic industries, especially small and cottage industries which are unable to face such competition.
  4. Foreign trade may encourage the importation of luxury goods which are not useful to the masser.
  5. Because of foreign trade, some developed countries may resort to the practice of dumping their goods in under-developed and developing countries.
  6. Foreign trade speacialisation resulting from the foreign’s trade, a country may develop a certain sector of her economy, neglecting other sectors.
  7. Foreign trade may cause serve balance of payments problem, and a country may be forced to borrow from international sources. Huge foreign debts may impair, a country’s capacity to import goods.
  8. Foreign trade is likely to ruin an economy which exports only raw materials to other countries.
  9. Foreign trade leads to international competition and rivalry, and sometimes, leads to international frictions and wars.
  10. Foreign trade dives an opportunity to foreigners to intervene in the domestic affairs of a country.
The following two tabs change content below.
We, at BMS.co.in, believe in sharing knowledge and giving quality information to our BMS students. We are here to provide and update you with every details required by you BMSites! If you want to join us, please mail to [email protected]

Leave a reply

BMS.co.in is aimed at revolutionising Bachelors in Management Studies education, also known as BMS for students appearing for BMS exams across all states of India. We provide free study material, 100s of tutorials with worked examples, past papers, tips, tricks for BMS exams, we are creating a digital learning library.

Disclaimer: We are not affiliated with any university or government body in anyway.

©2020 BMS - Bachelor of Management Studies Community 

A Management Paradise Venture

Ask Us On WhatsApp

Log in with your credentials


Forgot your details?


Create Account