Asia Ought To Be Looking Towards India Now as Chinese Economy Starts Faltering
The impact of the Wuhan coronavirus pandemic on the economy of China, Asia’s largest, and its spillover effects are moving in a worrying direction.
There have been great income losses and unemployment triggered by Chinese methodologies to contain the Wuhan Virus spread in the country. The over all impact will take some time to be felt and seen but is likely to push as many as 25% of the population back into poverty, erasing its poverty reduction efforts over the past two decades.
Meanwhile, in India an analysis of 270,000 antibody tests conducted by a leading private laboratory across India has showed that an average 26 percent of Indians may have already been infected with the coronavirus and are now cured and developed immunity.
Though these figures highlight the severity of the pandemic situation in India, it also shows that there is nothing to panic. The Indian government is taking all possible action to bring the wave of outbreak under control and restore economic momentum in the short term.
The impact of the pandemic on the Indian economy is far from over, though the risk of a protracted and deep economic contraction is now fading.
While it is unclear to what extent India’s economic downturn will affect the overall economic situation, the domestic consumption has already started rising at a fast pace. All the factory stocks from earlier outputs have already been released and warehouses are now awaiting fresh production.
India is rightly regarded as a promising engine of global economic growth, given its large population and market potential.
Many companies are exiting from China and entering the Indian market in hopes that an early foothold would support the development of their own industry chains and business expansion in South Asia. Now the rapid recovery of economic indicators within India’s economic landscape, is sending a ray of hope through regional industry chains and business circles.
Despite the Wuhan epidemic, strong economic fundamentals, have helped the stock market in India to boom, with the Sensex on a rally since March.
What’s disturbing us is that the more challenging domestic economic situation is becoming in China, the more tension they are trying to create on the Indo Tibetan Border. Bad sentiments have risen within the Communist Party of China and the PLA and this trend is playing an increasingly important role in its geopolitical strategy and choices. This situation is creating new uncertainties over issues like whether China will wage a war with India over Tibet or with USA over Taiwan and South China Sea.
India’s trade policy has now been subjected to the influence of geopolitics. India has taken a deliberate decision to decouple economically from China. We will not have any economic or social relationship with any country which attacks and kills our soldiers. So in recent months, Indians have started boycotting Chinese products, banning Chinese apps and restricting Chinese investment,
Asia and the world at large need to be vigilant toward the spillover of China’s internal predicament and geopolitical risks, which show no signs of abating now.
