Chinese paper slams Modi govt’s ‘paper growth’
BEIJING: A commentary in a Chinese Communist Party-run newspaper has slammed the Narendra Modi government’s economic policy as “a success today but a failure tomorrow”, rejecting the prospects of sustained Indian growth posing a challenge to China’s slowing down economy.
Describing India’s 7.4 per cent GDP growth rate as “paper growth”, the commentary said India’s growth rate surpassing China’s 6.9 per cent in 2015 was more a result of “manipulated economic data” rather than a reflection of a shift of global economic power from China to India, reported India Today.
The article was published on Monday in the Global Times, a tabloid under the stable of the Communist Party’s official mouthpiece People’s Daily. The piece was authored by Dai Yonghong, director of the Institute of South Asian Studies, Sichuan University, and Wang Jianping, a scholar at the same university.
Pointing to China’s own experience, they warned that seeking investment-driven growth can be “a misfortune rather than a blessing”.
“Modi’s ‘recipe’ is nothing more than efforts to attract investment, with the heat of capital to push development in India. Indeed, the power of capital can really create the myth of prosperity, but it’s presumed that it can also create a bubble trap in which lies the greatest risks for the future development. A highly efficient Chinese government finds it difficult to deal with the troublesome middle income trap, so how can one expect Modi’s successors to drag the “burdensome democracy” of India to create miracles?”
The authors said the Modi government’s economic policy would not work in the long-term, saying he was “too persistent in pushing the image of a bustling and prosperous economy while remains blinded to the root of India’s ills”.
“At the time when India is becoming the rotating presiding country of the BRICS group, the myth that India’s economy has successfully caught up with China’s also resonates,” they wrote. “Indeed, behind Prime Minister Narendra Modi is his management experience in Gujarat, but this doesn’t prepare him for successfully governing a large country, nor can his manipulated economic data be used to prove the arrival of a ‘catch up with the US and surpass China’ era. It can be fairly safe to say that there is still a long way to go before India can actually lead the other BRICS countries.”
The commentary described India’s growth as “paper growth” that has “caused some increasingly serious social problems”.
“India has reportedly changed the statistical method of GDP and other important economic indicators several times in order to moisten the data to make the government seem more credible. In 2015, India’s on-paper GDP growth rate of 7.4 percent has exceeded that China’s 6.9 percent for the first time by the ‘creative’ use of a new statistical method of GDP at market prices rather than at factor cost.”
Despite the ‘hype’, the commentary pointed out, “India’s laboring people are still struggling on the edge of poverty where survival, rather than quality of life, is the main concern”.
“The number of people living in absolute poverty in India is far greater than any other country in the world, and high unemployment and inflation are still troubling many. Ethnic conflicts, religious conflicts and regional unrest are increasingly serious due to the catalysis of the disparity between the rich and the poor.”