NCERT Class 12 Human Geography Chapter 9 – International Trade

NCERT Class 12 Human Geography Chapter 9 explains the concept of international trade and its importance in the global economy. Students should refer to the official NCERT website at for authentic textbooks and syllabus updates. In NCERT Class 12 Human Geography Chapter 9, students learn how countries exchange goods and services across borders.

NCERT Class 12 Human Geography Chapter 9 discusses types of trade, balance of trade and major trade routes. It also explains the role of trade blocs and economic cooperation in promoting global development.

NCERT Class 12 Human Geography Chapter 9 is important for CBSE board exams and competitive exams like UPSC and BPSC because questions on globalisation, trade imbalance and economic integration are frequently asked. A strong understanding of NCERT Class 12 Human Geography Chapter 9 helps students analyse international economic relations.

For structured preparation of NCERT Class 9–12 for UPSC, BPSC and State PCS examinations, strengthen your basics with our complete NCERT Book Notes PDF for Class 9-12, available inside the NCERT foundation course level-2.

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1. History of international trade

• In ancient times, long distance transport was risky, so trade was mostly local and limited to basic necessities like food and clothes, while luxury goods were traded by the rich.
• The Silk Route (6,000 km) (R) connected Rome (R) to China (R), trading Chinese silk, Roman wool, precious metals and other high-value goods through India (R), Persia (R) and Central Asia (R).
• After the fall of the Roman Empire (R), European trade expanded in the 12th–13th centuries with ocean-going ships, increasing trade between Europe (R), Asia (R) and leading to the discovery of the Americas (R).
• From the 15th century, Portuguese (R), Dutch (R), Spaniards (R) and British (R) began colonial expansion and introduced the slave trade, transporting African natives to the Americas (R) for plantation labour.
• Slave trade continued for more than 200 years and was abolished in Denmark (1792) (R), Great Britain (1807) (R) and United States (1808) (R).
• After the Industrial Revolution (R), industrial nations imported raw materials like grains, meat and wool and exported value-added manufactured goods, changing the structure of world trade.
• During World Wars I and II (R), countries imposed trade taxes and quantitative restrictions, but in the post-war period GATT (R) reduced tariffs and promoted international trade.

2. Why does international trade exist?

• International trade arises due to specialisation in production, where different countries focus on producing specific goods or services.
• It benefits the world economy when countries practise division of labour, leading to efficient production and exchange.
• Trade is based on the principles of comparative advantage, complementarity and transferability of goods and services.
• Comparative advantage means countries produce goods in which they have relative efficiency and trade for others.
• Complementarity exists when one country produces what another country demands.
• Transferability refers to the ability to move goods from one place to another at low cost.
• In modern times, international trade forms the basis of the world’s economic organisation and is closely linked with the foreign policy of nations (R).
• With advanced transport and communication systems, countries actively participate in global trade to gain economic benefits.

3. Basis of international trade

• Difference in national resources forms the main basis of trade because resources are unevenly distributed due to variations in geology, relief, soil and climate.
• Geological structure determines the mineral base; lowlands (R) support agriculture, while mountain regions (R) promote tourism.
• Mineral resources are unevenly distributed globally, and their availability supports industrial development.
• Climate differences influence production patterns such as wool in cold regions, and bananas, rubber and cocoa in tropical regions.
• Population factors like size, distribution and cultural diversity affect the type and volume of goods traded.
• Unique cultural products such as Chinese porcelain (R), Iranian carpets (R), North African leather work (R) and Indonesian batik cloth (R) create international demand.
• The stage of economic development determines trade patterns; agricultural countries export agro-products, while industrialised nations export machinery and finished goods and import raw materials.
• Transport development and foreign investment expand trade by enabling mining, oil drilling, heavy engineering and plantation agriculture, increasing global trade volume.

4. Important aspects of international trade

• International trade has three main aspects: volume of trade, sectoral composition of trade and direction of trade.
• Volume of trade refers to the total value of goods and services traded between countries.
• Sectoral composition explains the types of goods and services exchanged such as primary products, manufactured goods and services.
• Direction of trade shows the countries or regions with which trade is conducted.
• Changes in these three aspects reflect shifts in the global economy and development patterns.

5. Volume of trade

• Volume of trade refers to the total value of goods and services traded, as services cannot be measured in tonnage.
• The total volume of world merchandise trade has shown a steady rise over the decades.
• World merchandise exports increased from 95,000 million US$ in 1955 to 15,583,232 million US$ in 2015.
• World merchandise imports increased from 99,000 million US$ in 1955 to 15,628,204 million US$ in 2015.
• The consistent rise in imports and exports indicates expansion of global trade.
• The data source for world trade figures is wits.worldbank.org (as on 21.07.2017) (R).

6. Composition of trade

• The nature of goods and services traded internationally has changed significantly over the last century.
• In the early 20th century, trade was dominated by primary products such as agricultural goods and raw materials.
• Over time, manufactured goods gained importance and now command the bulk of global merchandise trade.
• From 2005 to 2015, manufactured goods contributed the largest share in world merchandise exports.
• Fuels and mining products and agricultural goods also remain important components of world exports.
• The service sector, including travel, transportation and other commercial services, has shown a steady upward trend in global trade.

7. Direction of trade

• In earlier periods, present-day developing countries (R) exported valuable goods and artefacts mainly to European countries (R).
• During the 19th century (R), there was a reversal in trade direction as European countries (R) began exporting manufactured goods in exchange for foodstuffs and raw materials from their colonies.
• Europe (R) and U.S.A. (R) emerged as major global trade partners and leaders in manufactured goods trade.
• Japan (R) became the third important trading country during that period.
• In the second half of the 20th century (R), world trade patterns changed drastically as Europe (R) lost its colonies.
• Countries like India (R) and China (R) began competing with developed nations, and the nature of goods traded also changed.

8. Balance of trade

• Balance of trade records the value of goods and services imported and exported by a country.
• When the value of imports exceeds exports, it is called a negative or unfavourable balance of trade.
• When the value of exports exceeds imports, it is called a positive or favourable balance of trade.
• Balance of trade, along with balance of payments, has serious implications for a country’s economy.
• A negative balance means a country spends more on imports than it earns from exports.
• Continuous negative balance can lead to exhaustion of financial reserves and economic instability.

9. Types of international trade

• International trade is categorised into Bilateral Trade and Multilateral Trade.
• Bilateral Trade takes place between two countries, where they enter into agreements to exchange specified commodities.
• In bilateral trade, one country may export raw materials and agree to import certain specified goods from the partner country.
• Multilateral Trade is conducted with many trading countries simultaneously.
• Under multilateral trade, a country trades with several nations and may grant the status of Most Favoured Nation (MFN) to some trading partners.

10. Case for free trade

• Free trade or trade liberalisation means opening up economies by reducing trade barriers like tariffs.
• Trade liberalisation allows goods and services from different countries to compete with domestic products.
• With improved transport and communication systems, goods and services can move faster and farther across countries.
• Globalisation along with free trade may adversely affect developing countries (R) if unequal conditions are imposed.
• Free trade should not allow only rich countries to access markets while protecting their own markets from foreign products.
• Countries must be cautious about dumping, which means selling goods in another country at prices unrelated to actual production cost.
• Dumped goods at cheaper prices can harm domestic producers and local industries.

11. World trade organisation

• In 1948 (R), the General Agreement on Tariffs and Trade (GATT) (R) was formed to reduce high customs tariffs and trade restrictions.
• GATT aimed at liberalising world trade by lowering trade barriers among member countries.
• After several rounds of negotiations, GATT evolved into the World Trade Organisation (WTO) (R).
• The WTO (R) was established to supervise global trade and ensure smooth functioning of international trade rules.
• It works towards reducing tariffs, resolving trade disputes and promoting fair trade practices among member nations.

12. Regional trade blocs

• Regional Trade Blocs are groups of countries formed to promote trade and economic cooperation within a specific region.
• These blocs aim to reduce tariffs and trade barriers among member countries.
• Major regional trade blocs include European Union (EU) (R), formed from the European Economic Community (1957) (R) and later established as EU in 1992 (R).
• ASEAN (1967) (R) promotes economic growth, regional stability and trade cooperation among Southeast Asian countries.
• OPEC (1960) (R) coordinates and unifies petroleum policies among oil-producing countries.
• SAARC (1985) (R) promotes regional cooperation among Bangladesh (R), Maldives (R), Bhutan (R), Nepal (R), India (R), Pakistan (R) and Sri Lanka (R).
• Regional trade blocs help increase intra-regional trade and strengthen economic integration.

13. Concerns related to international trade

• International trade is beneficial when it promotes regional specialisation, higher production, better standard of living and worldwide availability of goods and services.
• It can become harmful if it creates dependence on other countries, uneven development, exploitation and commercial rivalry leading to wars.
• Increasing global trade raises production and use of natural resources, causing faster depletion than replenishment.
• Environmental impacts include depletion of marine life, deforestation and privatisation of river basins for drinking water.
• Multinational corporations engaged in oil, gas, mining, pharmaceuticals and agri-business often expand operations without following sustainable development norms, leading to pollution.
• If trade is driven only by profit motive without addressing environmental and health concerns, it may create serious long-term global problems.

14. Gateways of international trade – ports

• Harbours and ports are the chief gateways of international trade, through which cargo and passengers move from one part of the world to another.
• Ports provide facilities for docking, loading, unloading and storage of cargo.
• Port authorities maintain navigable channels, arrange tugs and barges, and provide labour and managerial services.
• The importance of a port is judged by the size of cargo handled and the number of ships serviced.
• The quantity of cargo handled reflects the level of development of its hinterland (R).
• San Francisco (R) is known as the largest land-locked harbour in the world.

14.1 Types of port

• On the basis of cargo handled, ports are classified as Industrial Ports, Commercial Ports and Comprehensive Ports.
• Industrial Ports specialise in bulk cargo such as grain, sugar, ore, oil and chemicals.
• Commercial Ports handle general cargo, packaged products, manufactured goods and also manage passenger traffic; example: Leningrad Commercial Port (R).
• Comprehensive Ports handle both bulk and general cargo in large volumes, and most major world ports fall under this category.
• On the basis of location, Inland Ports are situated away from the sea coast and connected by rivers or canals; examples include Manchester (R), Memphis on Mississippi River (R), Mannheim (R) and Duisburg on Rhine River (R), and Kolkata on Hoogli River, a branch of Ganga (R).
• Out Ports are deep-water ports built away from main ports to receive large ships; example: Athens (R) and its out port Piraeus (R) in Greece (R).
• On the basis of specialised functions, Oil Ports handle processing and shipping of oil; tanker ports include Maracaibo (R) in Venezuela (R), Esskhira (R) in Tunisia (R) and Tripoli (R) in Lebanon (R), while Abadan (R) on the Gulf of Persia (R) is a refinery port.

15. Major regional trade

• ASEAN (1967) (R) includes Southeast Asian countries and trades in agro products, rubber, palm oil, rice, copra, coffee, copper, coal, nickel, tungsten, petroleum, natural gas and software products; aims at economic growth, cultural development, peace and regional stability.
• OPEC (1960) (R) includes major oil-exporting countries such as Iran (R), Iraq (R), Kuwait (R), Saudi Arabia (R), Venezuela (R); trades mainly in crude oil and natural gas; works to coordinate and unify petroleum policies.
• European Union (EU) (1957 as EEC; 1992 as EU) (R) trades in agro products, minerals, chemicals, wood, paper, transport vehicles, optical instruments, clocks, works of art and antiques; promotes economic, defence and foreign policy integration and operates a single market with single currency.
• NAFTA (1994) (R) (now replaced by USMCA) involved USA (R), Canada (R) and Mexico (R); major traded items include agro products, motor vehicles, automotive parts, computers and textiles; aimed at reducing tariffs on inter-regional trade.
• SAARC (1985) (R) includes Bangladesh (R), Maldives (R), Bhutan (R), Nepal (R), India (R), Pakistan (R) and Sri Lanka (R); promotes regional cooperation and economic development among South Asian countries.
• These regional trade groups focus on reducing trade barriers, promoting intra-regional trade and strengthening economic cooperation among member nations.

NCERT Class 12 Human Geography Chapter 9 provides a clear understanding of how international trade connects economies and promotes development. Mastering NCERT Class 12 Human Geography Chapter 9 helps students interpret trade data and global economic trends.

A detailed study of NCERT Class 12 Human Geography Chapter 9 strengthens preparation for topics like trade policies, regional trade agreements and global economic organisations.

Continue reading NCERT Class 12 Human Geography Chapter 10 – Human Settlements to understand rural and urban settlement patterns in a structured and exam-oriented manner.

Frequently Asked Questions (FAQs)

Q1. What is NCERT Class 12 Human Geography Chapter 9 about?
NCERT Class 12 Human Geography Chapter 9 explains international trade and global trade patterns.

Q2. Why is NCERT Class 12 Human Geography Chapter 9 important for exams?
NCERT Class 12 Human Geography Chapter 9 is important because globalisation and trade-related questions are commonly asked in CBSE and UPSC exams.

Q3. What is balance of trade in NCERT Class 12 Human Geography Chapter 9?
Balance of trade refers to the difference between the value of a country’s exports and imports.

Q4. How does NCERT Class 12 Human Geography Chapter 9 help in UPSC preparation?
NCERT Class 12 Human Geography Chapter 9 builds conceptual clarity about global economic relations, which is important for Geography and General Studies papers.

Q5. Is NCERT Class 12 Human Geography Chapter 9 linked with later chapters?
Yes, NCERT Class 12 Human Geography Chapter 9 connects directly with human settlement patterns discussed in the next chapter.

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