How Modi’s Economic Achievements Have Been Viewed By China
Prime Minister Narendra Modi has ensured initiation of several measures to reform India’s tax system, upgrade its bankruptcy laws and relax restrictions on foreign investment. The country witnessed a 23-place jump to a record 77th position in the World Bank’s latest report on the ease of doing business, which covered 190 countries and regions. Facts have proved that India’s economic reforms are conducive to improving the business climate for foreign investment.
Just a day back, the Crown Prince of Saudi Arabia has announced in New Delhi, a desire to invest nearly 100 billion dollars in India and there by starting a new chapter in Indo Saud economic Cooperation. This in total contrast to the 3 billion dollars alms handed over to Pakistan by the same Crown Prince.
In 2018, India saw more than $38 billion of inbound deals, outnumbering that of China for the first time in two decades. India is moving in the right direction to make foreign investment a powerful engine for economic growth and poverty alleviation. It is the same strategy adopted by China three decades ago at the initial stage of its industrialization process.
However now as India is accelerating its efforts to make it easier to do business in the country, the China’s labor cost advantage are shrinking at a very fast pace. Chinese enterprises should therefore pay more attention to changes in the Indian economy.
Modi after launching a range of reform initiatives earlier, started ensuring that local state authorities, at least those states under NDA rule, to fully implement these policies to ensure that the country’s economic reform starts to go forward and results are seen on the ground.
Effective implementation of current policies is now more important than launching new initiatives, and this effort will lay the groundwork for a better business climate.
India’s labor cost advantage has led to many Chinese manufacturers to look closely at setting up assembly lines in India. Achieving a better understanding of India’s changing business climate will help achieve win-win results and joint development of the two emerging economies.
China and India must enhance strategic communication and mutual trust to move their economic ties forward. Currently, the most urgent task is to prevent the suicide attack in the Pulwama district from affecting economic relations and India’s inbound investment.
Ahead of a general election, the disorganized but desperate Opposition parties have started questioning whether his reforms can create enough jobs for young people.
But the foreign investment figures suggest that Modi has done a good job in addressing unemployment. The future seems to be bright.