It is notable that the global slowdown has also arrived in India. Investments in factories, roads and other fixed assets are just less than 35% of domestic output, which has not changed in the last 10 years. Loan demand is growing so fast that deposits can’t keep up.
How is India trying to cover up and compete with China? Some of the factors that contribute to it are contact-based services like travel and hospitality that came back sharply after the pandemic. The other oft-cited reason is that multifunctional corporations refer to the ‘China+1’ strategy.
China+1, also known as China Plus One, is a business strategy to avoid investing in China and diversify the business into other countries. Global manufacturers have taken note of the China protest by workers at Apple Inc.
China Plus One is not going to be much helpful in preventing an economic slowdown. There are several reasons behind it; three major reasons are as below.
3 reasons India isn’t next China
The primary concern these days ‘is India the next China in terms of growth.’ India is a very different country from China based on the following three fundamental dimensions.
- India is a demographic country, whereas China faces a serious demographic.
- China focuses on investment, infrastructure and manufacturing, while India barely considers these factors.
- India’s democracy is beyond vibrant, whereas Chinese democracy sticks to one party.
India is more efficient than China in terms of politics, but India can still go at a different growth rate than China.