Indian economy poses major challenges: Chinese think tank

Tarun Kumar

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Rajan was US deep state agent undermining Indian growth
He was not. He was the first economist to foresee the 2008 crisis full 5 years before it happened. He was also against giving up 4% inflation targeting to boost growth in India which is why Modi sacked him. We are seeing Modinomics in action today-Mumbai and Delhi are garbage dumps and gas chambers, rural areas are in deep distress and all economic activity is concentrated in few cities where people live life of insects not humans.
 

busesaway

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I'm not an economist so I shouldn't really partake in these discussions, but I generally think the fund-based model, where the government owns investment fund that invest into projects/companies it thinks would help the economy grow or improve infrastructure/sanitation, is generally the best model for economic growth.

The majority of state owned companies have generally been by-products of natural monopolies or situations where the start-up costs were too great to be borne by any private organization, so I something think that the large number of state-owned companies competing with private companies is actually a disadvantage for India.

What India needs to do is find a way to stop talent and money leaving India for accounts, products, and jobs overseas, through methods that encourage them to stay in India or pay back to India.

I also propose a levy on people who do not take out social insurance for themselves and their family even-though that can afford to, and funding for charitable Hindu organizations that provide welfare services like schools and hospitals. And maybe even a special "education loan system" that requires people who leave the country to pay back into the system for the welfare services they have used.
 

busesaway

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He was not. He was the first economist to foresee the 2008 crisis full 5 years before it happened. He was also against giving up 4% inflation targeting to boost growth in India which is why Modi sacked him. We are seeing Modinomics in action today-Mumbai and Delhi are garbage dumps and gas chambers, rural areas are in deep distress and all economic activity is concentrated in few cities where people live life of insects not humans.
This is China. The majority of economic activity is concentrated in the urban cities where millions of Chinese youth immigrate too. And China even has a government-enforced caste system that requires people to go back to where their families originate from in order to obtain welfare!

I disagree completely with providing subsidies towards the rural peoples. If you look at what is happening in Bengaluru, the state government is using the city's profits and giving "free money for votes" in rural areas instead of investing in Bengaluru's infrastructure.
 

busesaway

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The predominant reason why Western Europe has discovered so much in terms of scientific advancement is due to the amount of money it has at its disposal to invest in research and development.

And the catalyst for that money was the chance discovery of the Americas and the consequent era of colonialism, the 19th century equivalent of stumbling on an oil field, which allowed Western Europe to expand its economy and increased the amount of wealth that people could invest into scientific advancement.

The total population of the West exceeds 600 million people, which increases even more (nearly 1 billion) if you throw in countries in Eastern Europe and Israel; the only sizable competitor for the West in the past few decades was Japan - numbering only around 100 million people.

I think both India and China would be able to match the scientific and philosophical advancements of Western Europe once they attain the disposable wealth that is required to be able to invest into research projects.
 

armyofhind

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Bullshit, India lags in manufacturing sector, we will never be able to compete with the chinese if we continue like this, the only thing that our foolish ecomic planners have achieve so far is stupid call centre jobs in India, you can never build an economy like china or south korea or japan with services sector. Modis make in India plan also doent seem to be working, its just that the things which were already being made in India got a new logo of make in India, this is very frustrating
Manufacturing units aren't setup overnight. It takes time. Land allotment, investor incitement.. public appeasement... it's a delicate balance.
More manufacturing units are coming up in big ways in several areas of India, Jharkhand being the most recent example.

For them to be fully operational and start generating jobs, that will take time. Have patience.
Furthermore, the abysmal policy decisions of the past 30 years cannot be reversed in just 3.

Infrastructure is being built at a breakneck pace really to support future industrialization. 11km of new roads a day is not a joke. And no its not hogwash.... the data is there in the public domain for all to see.

And if you're saying that make in India isn't working.. let me ask you.. are you involved in msme in any way? get in touch with somebody who is and they can tell you the difference between then and now.


I would love it if @Indx TechStyle throws more light on this.
 

Amrk

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http://www.livemint.com/Politics/xa...Is-Make-in-India-beginning-to-bear-fruit.html
Is ‘Make in India’ beginning to bear fruit?

Three years after the Narendra Modi government took charge in Delhi, one of its key programmes, the ‘Make in India’ initiative, may be finally bearing fruit. Three different sets of macro-economic data—the number (and value) of industrial projects being set up in the country, foreign direct investment (FDI) and merchandise exports—seem to point to a pick-up in industrial activity in Asia’s third-largest economy.

Of the three, it is the first trend that appears most promising. The value of new industrial units set up in the country rose 29% in calendar year 2016 over the previous year, a Mint analysis of Department of Industrial Policy and Promotion (DIPP) data shows.

It remains to be seen whether the trend is sustained in the coming years. The value of proposed projects in 2016 was significantly higher than that in 2015 but only marginally higher than that in 2014.





There seems to be a sharp regional skew in the pattern of investments. Maharashtra, Karnataka and Madhya Pradesh have witnessed the biggest spurt in new industrial investments over the past two years, with most new industrial units being set up in these states. Maharashtra alone accounted for a third of new industrial units set up since the beginning of 2015. Karnataka and Madhya Pradesh together accounted for a fifth of such units, DIPP data shows.



The trend in FDI has also been encouraging over the past year. Not only did FDI inflows jump 18% to a record level of $46.4 billion in 2016, the proportion of investments directed towards manufacturing also increased. Although services such as telecom and insurance remain the favourite bets of foreign investors, the overall composition of FDI in 2016 turned towards the manufacturing sector, which registered a 38% annual rise in inflows, Citibank economists Samiran Chakraborty and Anurag Jha wrote in a 23 March note. But despite liberalization of FDI norms, sectors such as defence and railways have attracted very little investment, the note pointed out.

The recent recovery in merchandise exports has also added to the optimism around the ‘Make in India’ initiative. Capital goods (engineering goods), textiles and commodities (iron-ore) have been the major contributors to the recent surge in exports.

Of the three trends, the prognosis for exports appears weakest. As the chart below shows, the recent rise in exports from India appears to be part of a global cyclical recovery.

Of the three trends, the prognosis for exports appears weakest. As the chart below shows, the recent rise in exports from India appears to be part of a global cyclical recovery.





The current recovery in Asian exports is largely on the back of cyclical factors and there remain “risks of a more pronounced export slowdown in 2018”, a 27 April note by Sonal Varma and other analysts at Nomura said.

There is another problem with India’s manufacturing exports. While manufacturing exports as a share of India’s aggregate output has increased in recent years, the contribution of the manufacturing sector to India’s gross domestic product (GDP), embodied in the sector’s value-addition, has not increased.

This is because most value-addition is taking place offshore, as a previous Plain Facts column pointed out. The integration with global value chains has not helped India move up the value chain but instead seems to have led to a “hollowing out” of India’s manufacturing, as described by Rashmi Banga, an economist with United Nations Centre for Trade and Development, in a 2014 Economic and Political Weekly article.

The twin goals of Indian manufacturing policy over the past few decades have been to help Indian firms move up the value-chain and to create more factory jobs. But the two goals have often been in conflict. The increase in value-addition (and productivity) since liberalization of the Indian economy has precisely been in those sectors which have replaced labour with machines.

The challenge for the ‘Make in India’ initiative is to facilitate the creation of high-productivity jobs in labour-intensive sectors. With China attempting to rebalance its economy and lower its dependence on exports, there is an opportunity for India to step in and carve out a space for manufacturing labour-intensive products for the world.

There are some encouraging signs in this regard, DIPP data shows. Textiles and electrical equipment, two relatively labour-intensive sectors with export potential, are two of the top three gainers in new projects over the past two years.









While India already enjoys a comparative advantage in textile exports, it is a small player in the global electrical equipments market.

Only if India is able to grow such sectors will it be possible to generate new jobs even while raising productivity levels of Indian manufacturing....................................................................................................................



Tadit Kundu
 

Amrk

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Manufacturing units aren't setup overnight. It takes time. Land allotment, investor incitement.. public appeasement... it's a delicate balance.
More manufacturing units are coming up in big ways in several areas of India, Jharkhand being the most recent example.

For them to be fully operational and start generating jobs, that will take time. Have patience.
Furthermore, the abysmal policy decisions of the past 30 years cannot be reversed in just 3.

Infrastructure is being built at a breakneck pace really to support future industrialization. 11km of new roads a day is not a joke. And no its not hogwash.... the data is there in the public domain for all to see.

And if you're saying that make in India isn't working.. let me ask you.. are you involved in msme in any way? get in touch with somebody who is and they can tell you the difference between then and now.


I would love it if @Indx TechStyle throws more light on this.
Check the preceding post, would like to hear your views
 

no smoking

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Only partly true. Most of Yuans printed by China and USD printed by US stays within China and US where this additional currency causes havoc in the economy.
No, for US, the majority of money went out overseas already, that is why every time the federal reserve hold the meeting about interest rate, the emerging markets are always nerves because too much US dollars already got into their market in the form of cheap loan.

The Chinese is doing it in different way: Chinese companies and individual started their overseas investment with these cheap RMB. Their domestic properties value doubled or even tripled in the last 10 years, they borrowed US dollars from Chinese bank based their property, and then invested these dollars in overseas--property, infrastructures, shopping center, factories. In return, they imported Chinese surplus products. But from here, things go differently, for most of developing countries, dollars are very precious reserve for them, so Chinese often offered an attractive solution: don't pay your import with dollars but your resource.

With this strategy, both countries already flood the world with their cheap money under the form of cheap loan.

The only beneficiaries are rich entrepreneurs and corrupt Government officials and loosers are common people who are permanently locked out of housing market. I have many Chinese friends and not one plans to stay in China despite very good jobs. Most are looking to Australia and NZ to migrate.
No, they are not. The one can't afford buying apartment in China simply can't afford immigration. You have to understand those who are too poor to buy an apartment in China are basically the group of people who came from poor families and did not receive good education. For these people, they won't think to immigrate because they simply have no chance at all.

I don't know how your Chinese friends told you or how you misunderstand them. But if they can confirm that they have a GOOD job in China, that means they have at least one apartment already.

Both US and CHina know it and both are scrambling to grab more resources overseas to avoid it.
That is exactly what I mean, US and China are exporting their cheap money to the whole world.
 

busesaway

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Make In India can only succeed if Modi drops its liberalism/charitable attitude towards foriegn relations.
  • stop all imports of petroleum from the Middle East under the guise of supporting Indians against racism and poor human rights in the countries of the GCC, and due to the ME's support for Islamism
  • build a wall along Kashmir and kick Pakistan out of the SAARC, or create a new trade bloc that seeks to unite the friendly countries in South Asia, or even just the Hindu/Buddhist countries.
  • advocate a pro-Beijing attitude, except in regards to: Beijing's support against the cultural independence of Tibet, Beijing's support for Islamism, Beijing's support for Maoism in India, Beijing's disregard for the freedom of the open seas, and Beijing's support for redrawn national boundaries.
  • ensure that all government contracts are given to indigenous companies who intend to invest the majority of that money into Indians and India
  • incentives and prohibitions to make sure that money remains in India
  • special investment funds that are used to encourage economic growth and improvement of infrastructure, and also for investment into arts, culture, and education.
 

kenyannoobie

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This think tank itself has failed miserably to read into india. While a growing Indian economy will pose competition to china in several sectors chiefly labour intensive manufacturing still India won't be china 2.0

India is already a service intensive economy and will grow faster into service sectors than any other.

China will soon face an ageing population (already avg Chinese is 10-15 years older than avg Indian) , low child birth and an acute labour shortage. Thus forcing it to dependent on younger nations such as Indonesia.

While India will soon surpass china in population and this growth will continue till 2060 when Indian population is expected to stabilize.

India has to focus on trade and China needs consumption from here on. Both can be very complimentary . But for that china needs to open market and there is nothing this think tank says about.
Yes,you do have issues but imo none of you have mentioned a major strength: your technological achievements are your own.
The long delayed LCA is the product of some foreign input,yes but the design and the majority of designers were Indian. On the other hand the much touted JF 17 is actually a rebuilt F 20 Tigershark.


This is an important detail since most 'Chinese' products are either 'borrowed' or stolen. Look at their entire new aircraft series. Straight copies of the F 35 and Pak fa. I'm sure you know the story of their domestic aircraft engine development.
Their economy has similarly along been guided by foreigners,specifically Anglo Zionists for a role as low cost production centre. They've been complicit in the shady stats,(many have said their GDP growth is exaggerated by at least 1-1.5%.
Basically,in a nutshell,while your growth may be unspectacular-its real!
 

DG7867

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This think tank seems to be blind to the elephant in the room.. their debt is too high, which is giving Chinese economy lot of problems. Rather than thinking of servicing the debt, they are talking about competition with India :doh:
 

garg_bharat

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Chinese have two things in plenty - contempt and jealousy.

Seeing contempt from Chinese on these forums since 1995. Change to jealousy is like a whip of fresh air.
 

HariPrasad-1

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It will be India which will become a true global player in the east.

Indian economy , with military and soft power are a good combination to become a super power. India needs technology development.
Indian economy poses major challenges: Chinese think tank

India's competitive economy may pose a challenge to China which may become an "unfortunate bystander" watching India succeed if it didn't develop a more effective growth strategy, a Chinese think-tank has warned.

By: IANS | Published: May 11, 2017 12:25 PM







India’s competitive economy may pose a challenge to China which may become an “unfortunate bystander” watching India succeed if it didn’t develop a more effective growth strategy, a Chinese think-tank has warned. (Image: Reuters)


India’s competitive economy may pose a challenge to China which may become an “unfortunate bystander” watching India succeed if it didn’t develop a more effective growth strategy, a Chinese think-tank has warned. The Beijing-based think tank Anbound also said that India could well become the next China because of low labour cost, young population and other factors. It pointed out that not enough studies were conducted on India and Beijing “cannot wait until India grows into an apparently promising competitor before discussing how to deal with the situation. “While Indian GDP may lag far behind (than that of China), the country remains a potential emerging market that has high attractiveness for global capital,” said the report, carried by the state-run Global Times on Thursday.

“Just as what happened with China in the past, the changes taking place in India may also point to a great potential for development. “In our opinion, if India intentionally creates a competitive situation in front of global investors, it will pose a challenge for China. “Moreover, there are growing signs that India is succeeding in attracting more and more investment, which China should take (note of) seriously. “As such, China should develop a more effective growth strategy for the new era or it may become an unfortunate bystander watching India’s success.

“The country’s vast domestic market, low labour costs and skilled labour market are its most attractive features. As China’s demographic dividend diminishes, India, with half of its population below the age of 25, is poised to take advantage.” An increasing number of Chinese companies had invested in India in recent years, covering such sectors as hardware, software and marketing. “It is noteworthy that Chinese companies’ investment in India has shifted from simply marketing to research and development (R&D),” it said. It cited the case of Chinese telecom company Huawei Technologies, which invested $170 million to open an R&D facility in Bengaluru, and has announced plans to join Prime Minister Narendra Modi’s “Make in India” campaign. “In other words, India may turn itself into China 2.0, and let global investors decide whether to invest in China or India.


“In our opinion, if India intentionally creates a competitive situation in front of global investors, it will pose a challenge for China. “China needs to ponder and study the rise of the Indian economy carefully. “With a young population, it is entirely possible for the emerging market economy to become China 2.0 to gain the attention of world capital.”

http://www.financialexpress.com/eco...s-major-challenges-chinese-think-tank/663476/

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I wanted to post a reply on this post but ultimately decided to analyze this in Detail. Here is where I have done it.

 

HariPrasad-1

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This think tank seems to be blind to the elephant in the room.. their debt is too high, which is giving Chinese economy lot of problems. Rather than thinking of servicing the debt, they are talking about competition with India :doh:
Any Rogue regime which has a hegemonic and unjust philosophy at its core can not survive long. China will collapse sooner than one would think.
 

Lonewolf

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This think tank seems to be blind to the elephant in the room.. their debt is too high, which is giving Chinese economy lot of problems. Rather than thinking of servicing the debt, they are talking about competition with India :doh:
Not too high and also from domestic sources , so not a big problem for them
 

FalconSlayers

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Any Rogue regime which has a hegemonic and unjust philosophy at its core can not survive long. China will collapse sooner than one would think.
No country collapses, I’m hearing china’s debt crisis for decades, nothing happened, nothing will happen.
 

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