RISE OF THE ELEPHANT & THE FALL OF THE DRAGON

August 27, 2015, In: Education, News, Reads
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Nakul

Chinese economy has been shrinking for over more than a year now . Its debt is plegged at 282% of its GDP . The recent efforts by Chinese central bank by d evaluating the Chinese currency yaun too seemed to be in effecting in moving the cycle of growth .However the spill over of Chinese economy is quite evident by the recent fall of Asian markets . On the contrary , India is in a much better position than china . The fundamentals of Indian economy are sound , inflation is under control and the biggest of all the domestic demand has increased . Indian market will soar to its best when the global economy recovers .

10 REASONS WHY INDIA IS AHEAD OF CHINA

 

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1) India’s GDP has continued to grow at a much faster rate than China since 2014 and has undoubtedly become the world’s fastest growing economy .

2) Excessive Chinese spending across the world has not left much room for further stimulus through public investment . Whereas India has trillions of dollars of public investment that could be used for infrastructure .

3) China’s Working age population is declining due to the One Child Policy that Beijing had implemented in 1980 .It is said China will grow old before it gets rich . India has a huge Working Age Population that will continue to grow till 2050 . So India has another 35 years to become a super power by utilizing its productibe Human Resource.

4) China’s growth story has been export oriented and hence it is vulnerable to external shocks whereas India’s growth is encouraged by huge domestic demand thus it was less effected by Global Economic Crisis 2008.

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5)Chinese Debt has risen to about 101% from 2007 whereas India’s debt has increased only about 5%  thus it has more headroom to take on debt to accelerate groth and development.

6) Due to the graying population of China its domestic demand is not growing . In India  the demand will take care of excess capacity.

7) Declining property prices have affected the market sentiments in China . People have stopped investing and selling their properties .India has no such worries.

8)China is about to face the problem of deflation (prices continue to fall at a negative rate ) just like Japan has failed to tackle the menace of deflation from the past 20 years. India has quite effectively tamed its inflation rate and with the fall in oil prices inflation’s seems to further cool down.

9) Indian always had an edge in the IT sector from China due to huge English speaking population. China is skilling its people in English so that they could do well in IT sector.

10) With a democracy and simple majority of Modi government investors feel  safe in investing in India rather than the Communist China where few members of the politburo decide the future of 1.357 billion people.