Jagriti Kumari
Niti Central
February 6, 2015
India, China should complement each other economically
World Economic Outlook (WEO) released by International Monetary Fund (IMF) in the third week of January this year, grabbed huge media attention as it predicted that India is on track to outdo China, the second largest economy in the world in the next few years and become the world’s fastest growing large economy.
WEO has predicted that India is expected to grow at 6.5 percent in 2016, which will overtake China’s projected growth rate of 6.3 percent.
Analysts have also predicted that India is likely to retain its growth rate for quite a long time.
According to an oped published in leading Chinese daily Global Times , this prediction has come as thrill for those western scholars who have finally got some proof for their claim that India’s “democratic system” gives more spur to development and innovation than China’s “authoritarian system.”
The oped suggests that India and China should not focus on rivalry with each other over the issue of development in fact they should pay attention on the areas they can cooperate and complement each other economically.
India should follow China that how it reduced poverty over the past three decade. According to World Bank report over 500 million people were lifted out of poverty as China’s poverty rate fell from 84 percent in 1981 to 13 percent in 2008, as measured by the percentage of people living on the equivalent of US$1.25 of less per day in 2005 purchasing price parity terms.
The World Bank has also stated that India will soon be equipped with largest and youngest workforce the world has ever seen. At the same time, the country is in the midst of a massive wave of urbanization as some 10 million people move to towns and cities each year in search of jobs and opportunity. It is the largest rural-urban migration of this century.
Momentum of Chinese economy growth has no historical precedent. It was 1978 when China was the poorest country in the world.
China’s development journey has become evident that once the growth rate of a big developing country with a huge population, various industries and a solid foundation of development starts accelerating, it is bound to create more opportunities for its neighbors and the world to share its economic achievements.
The rule is applicable for India also. India’s rising economic growth depends on its open trading system and vice versa. Only by sharing profits with neighbors, including China, can India sustain its economic growth rate.
