Despite being two most important economic giants in the world, both China and India are slowing down considerably. According to the International Monetary Fund, the annual outputs of these two nations are likely to increase 7.8 percent and 5.6 percent respectively, which is far better than the 2 percent growth in Japan, 1.7 percent growth in the U.S., 0.9 percent growth in Britain and 0.6 percent reduction in Europe. However, it is still much lower than the increase of over 10 percent, which was experienced by both of these countries in the year 2010.
As the global ‘Beijing consensus’ concept has almost moved out, the present leaders in China are trying to deal with several national issues like corruption, inflation, etc. The country needs to focus on research and development and come up with some mind-blowing innovations instead of following the rivals. Otherwise, it would not be possible for it to compete with the western counter-parts in terms of manufacturing and production.
Even though the amount of foreign exchange reserves is quite high for China, it is time for the country to take control over the national economy and balance it once again. It is of utmost importance that they switch to inspection as well as improvements of pensions for retired people, health care system, etc. from the development of finance and construction sectors.
India lacks money to reinforce social safety
However, in case of India, the situation is a bit different. Money is the biggest issue in the country and hence, the social safety is going to be destroyed to a large extent.
As the Government of India is unable to invest large amounts in education sector, health care sector, and so forth, it is really difficult to boost the productivity of labors and enhance the standards of living of common people. A sharp economic growth requires social justice at each and every level. So, the country must keep a close eye on this matter.
Apart from it, Indian administration should also take necessary steps to ensure the betterment of infrastructure, simplify national regulations and facilitate commercial investment.
However, both China and India need to work on their economical as well as social strategies in order to regain their lost growth. Or else, the impact of slowing down of these two economic giants of Asia might take a toll on their internal operations and the output of the global marketplace.