Chindia Alert: You’ll be Living in their World Very Soon
aims to alert you to the threats and opportunities that China and India present. China and India require serious attention; case of ‘hidden dragon and crouching tiger’.
Without this attention, governments, businesses and, indeed, individuals may find themselves at a great disadvantage sooner rather than later.
The POSTs (front webpages) are mainly 'cuttings' from reliable sources, updated continuously.
The PAGEs (see Tabs, above) attempt to make the information more meaningful by putting some structure to the information we have researched and assembled since 2006.
NEW DELHI (Reuters) – Indian Prime Minister Narendra Modi called on the nation to work toward ending the consumption of single-use plastics by 2022, in a speech on Wednesday.
“Hygiene, protection of environment and protection of life were of keen interest to Gandhi,” said Modi, speaking on the anniversary of the freedom movement leader’s birth. “Plastic is dangerous to all these three goals. So we need to reach the goal of ending single-use plastic by 2022.”
Meanwhile, India held off a plan to impose a blanket ban on single-use plastics as it was seen as a measure too disruptive for industry at a time when India is dealing with an economic slowdown and job losses, officials told Reuters on Tuesday.
In a tweet on Wednesday, India’s environment ministry however, denied that it had planned to issue a ban.
“India, today is on the verge of starting a historic movement against #SingleUsePlastic, setting an example for the world. At such a time, discovering a shelved ban, when none was planned is indeed misleading & doesn’t do justice to its fight against single use plastic,” the ministry said in a tweet.
Reuters had in August reported that India was set to impose a nationwide ban on plastic bags, cups and straws on Oct. 2, in a sweeping measure to stamp out single-use plastics from cities and villages that rank among the world’s most polluted.
Concerns are growing worldwide about plastic pollution, especially in oceans, where nearly 50% of single-use plastic products end up, killing marine life and entering the human food chain, studies have shown.
China is set to release pork supplies from its central reserves as it moves to tackle soaring prices and shortages caused by an outbreak of swine fever.
A state-backed body will auction 10,000 tonnes of frozen pork from its strategic reserves on Thursday.
China, the world’s biggest producer and consumer of pork, has struggled to control the spread of the disease.
In a bid to stabilise prices, a state-backed group that manages the pork reserves will auction imported frozen pork from countries including Denmark, France, the US and UK.
Only 300 tonnes will be sold to each bidder at the auction.
Pork is used widely in Chinese festivals, and the auction comes as the country prepares to celebrate a week-long national holiday for the 70th anniversary of the People’s Republic of China.
Julian Evans-Pritchard, senior China economist at Capital Economics, said the auction would provide slight relief to the industry but would not do much to contain prices.
“In itself, I don’t think it will be able to prevent pork prices from rising further unless they manage to get the disease under control,” he said.
Beijing created its strategic pork reserve in 2007 but the size of the stockpile is not known.
Capital Economics estimates that at most, the stockpile would hold four days’ worth of pork supplies to feed China.
About 1.2 million pigs have been culled in China in an effort to halt the spread of swine fever since August 2018, according to data from the Food and Agriculture Organization, a UN agency.
In April, Rabobank estimated Chinese pork production would fall by up to 35% this year due to swine fever.
The supply shortage has sent pork prices soaring and has eaten into household incomes.
That poses a fresh challenge for the Chinese economy, which is already facing a slowdown and a trade war between Beijing and Washington.
NEW DELHI (Reuters) – India will only sign a 16-member Asia-Pacific trade pact if its local industry is protected and if the deal would not lead to indiscriminate imports, the trade minister said on Wednesday.
Talks are ongoing to negotiate the China-initiated Regional Comprehensive Economic Partnership (RCEP), Piyush Goyal said, without specifying whether India would sign the deal in 2019.
New Delhi had asked South Korea and Japan to review free trade agreements with India, he added.
The Chief Economic Adviser, K Subramanian, disagreed with the idea of industry-specific incentives and argued for structural reforms in land and labour markets. Members of Prime Minister Narendra Modi’s economic advisory council sound inchoate, resorting to social media and opinion editorials to counter one another.
In essence, the quibble among the members of the economic team of Mr Modi and his government is not about whether India is facing an economic slowdown or not, but about how grave the current economic crisis is.
To put all this in context, it was less than just two years ago, in November 2017, that the global ratings agency Moody’s upgraded India’s sovereign ratings – an independent assessment of the creditworthiness of a country – for the first time in 14 years.
Image copyrightGETTY IMAGESImage captionSales of cars and SUVs have slumped to a seven-year low
Justifying the upgrade, Moody’s had then argued that the economy was undergoing dramatic “structural” reforms under Mr Modi.
In the two years since, Moody’s has downgraded its 2019 GDP growth forecast for India thrice – from 7.5% to 7.4% to 6.8% to 6.2%.
The immediate questions that arise now are: is India’s economic condition really that grim and, if yes, how did it deteriorate so rapidly?
To make matters worse, Finance Minister Nirmala Sitharaman presented her first budget recently with some ominous tax proposals that threatened foreign capital flows and dented investor confidence. It sparked criticism and Ms Sitharaman was forced to roll back many of her proposals.
Image copyright GETTY IMAGESImage caption In 2016, India withdrew 85% of all currency notes from the economy
So, it is indeed true that India is facing a sharp economic downturn and severe loss of business confidence.
The alarm over the economic condition is not merely a reflection of a slowdown in GDP growth but also the poor quality of growth.
Private sector investment, the mainstay of sustainable growth in any economy, is at a 15-year low.
In other words, there is almost no investment in new projects by the private sector. The situation is so bad that many Indian industrialists have complained loudly about the state of the economy, the distrust of the government towards businesses and harassment by tax authorities.
But India’s economic slowdown is neither sudden nor a surprise.
Behind the fawning headlines in the press over the past five years about the robustness of India’s growth was a vulnerable economy, straddled with massive bad loans in the financial sector, disguised further by a macroeconomic bonanza from low global oil prices.
India’s largest import is oil and the fortuitous decline in oil prices between 2014 and 2016 added a full percentage point to headline GDP growth, masking the real problems. Confusing luck with skill, the government was callous about fixing the choked financial system.
Media caption What is really happening with India’s economy?
This move destroyed supply chains and impacted agriculture, construction and manufacturing that together account for three-quarters of all employment in the country.
Before the economy could recover from the currency ban shock, the government enacted a transition to a new indirect taxation system of the Goods and Services Tax (GST) in 2017. The GST rollout wasn’t smooth and many small businesses initially struggled to understand it.
Such massive external shocks to the economy, coupled with a reversal in low oil prices, dealt the final blow to the economy. Millions of Indians started to lose their jobs and rural wages remained stagnant. This, in turn, impacted consumption, slowing down the economy sharply.
Not easy
The wobbly state of the economy has also thrown government finances in disarray: tax revenues are much below expectations.
On Monday, the government got a much-needed breather when India’s central bank announced a $24bn (£19bn) one-time payout for the cash-starved government. (This amount is more than the dividend paid by the central bank to the government in all five years of the Congress rule between 2009 and 2014.)
The solutions to the economic crisis are not easy.
Indian industry, fed and fattened with government protection through decades, is once again clamouring for tax cuts and financial incentives.
But it is not clear that such benefits will revive private sector investment and domestic consumption immediately.
For all the hype about the Make in India programme, hailed as the harbinger of the country’s emergence as a manufacturing power, India’s dependence on China for goods has only doubled in the past five years.
India today imports from China the equivalent of 6,000 rupees ($83; £68) worth of goods for every Indian, which has doubled from 3,000 rupees in 2014.
So, India is neither making goods for itself nor for the world.
Image copyright AFPImage caption India’s agrarian crisis is a major stumbling block
Ornamental tax and other fiscal incentives to specific industries are not suddenly going to make Indian manufacturers competitive and stop India’s addiction for affordable Chinese goods. If any, the trade spat between China and the United States only saw countries such as Vietnam and Bangladesh benefit and not India.
More currency or trade tariffs are not the solutions either. The central bank has lowered interest rates and there is some push to lowering the cost of capital for industry. But again, Indian industry will invest more only when demand for goods and services increases. And demand will increase only when wages increase, or there is money in the hands of people.
So, the only immediate solution for India seems to be to boost consumption through a stimulus given directly to people, in the classical Keynesian mould.
Of course, such a stimulus should be combined with reforms to boost business morale and confidence.
In sum, India’s economic picture is not pretty.
It is important for India’s political leadership to see this not-so-pretty picture and not hide behind rose tinted glasses. Prime Minister Modi has a unique electoral mandate to embark on bold moves to truly transform the economy and pull India out of the woods.
NEW YORK, Dec. 8 (Xinhua) — The value of China’s core Artificial Intelligence (AI) industries could exceed 1 trillion yuan (145.47 billion U.S. dollars) by 2030, with that of AI-enabled industries more than 10 trillion yuan, a latest report by Bloomberg Intelligence (BI) said.
Titled “China’s great tech leap forward”, the report said that China’s push to commercialize AI technologies, supported by the rollout of the world’s biggest 5G network, could position the country as a global leader for technology and innovation.
“Based on the growth trajectory in the past decade, China may overtake the U.S. in global technology-patents share by 2025,” said the report.
AI-related industries may exceed 6 percent of China’s GDP by 2030, according to the report.
In the report, BI analysts said the country’s abundance of data may fuel the acceleration of the industry.
China’s breakneck pace of consumer-lifestyle digitization potentially gives researchers unique access to Chinese-language data generated by its 1.4 billion people as they go about their daily activities both online and offline.
Vey-Sern Ling, senior industry analyst at Bloomberg intelligence, said China may overtake global peers in the commercialization of AI technologies, as large amount of capital is likely to continue pouring into the industry.
According to Tsinghua University, private funding for Chinese AI-related companies in 2017 totaled 27.7 billion dollars, equivalent to 70 percent of global investments in the industry.
Data showed China’s cumulative venture-capital investments in AI startups had already caught up with the United States by 2016.
Ling, also the lead analyst of the report, said the top-down support is an important factor apart from the multi-faceted user data and the funding available in China to the industry’s fast development.
“I don’t think anywhere else in the world you have the government so strongly behind, identifying the technology pillar and bearing full weight,” said Ling.
He added that China’s potential dominance in AI by 2030 may be led by developments in transportation, corporate services, health care and finance.
China said on Monday it expects to lay off 1.8 million workers in the coal and steel industries, or about 15 percent of the workforce, as part of efforts to reduce industrial overcapacity, but no timeframe was given.
It was the first time China has given figures that underline the magnitude of its task in dealing with slowing growth and bloated state enterprises.
“This involves the resettlement of a total of 1.8 million workers. This task will be very difficult, but we are still very confident,” Yin said.
For China’s stability-obsessed government, keeping a lid on unemployment and any possible unrest that may follow has been a top priority.
The central government will allocate 100 billion yuan ($15.27 billion) over two years to relocate workers laid off as a result of China’s efforts to curb overcapacity, officials said last week.
Indian industrial output probably made a tepid recovery late last year due to weak demand at home and abroad, underscoring the challenges faced in 2015 by Prime Minister Narendra Modi as woos global investors this week.
To accelerate the recovery in Asia’s third largest economy from its longest slowdown since the 1980s, Modi has pushed through a raft of economic reforms, mostly by executive orders.
But global headwinds, lukewarm domestic demand and unused industrial capacity mean capital investment has not picked up and the economy remains way below potential.
Retail inflation – still a major issue for Asia’s third largest economy though it fell to an all time low in November – probably rose sharply in December fueled by higher food prices.
CHINDIA ALERT: You'll be living in their world, very soon 