India Can Still Emulate China’s Export Miracle – Panagariya
India has every chance of becoming an export powerhouse, Prime Minister Narendra Modi’s top economic adviser told Reuters, despite an ill wind blowing from China that has hurt the ability of Asia’s third-largest economy to compete.ontracted 33.2% due to falling crude oil prices. Arvind Panagariya, the Columbia University economics professor tapped to run the government’s policy think tank last year, said in an interview he had seen China’s slowdown coming as wage costs there grew. The natural slowdown in the Chinese economy offered an opportunity, he said, because rising wages and an ageing workforce will encourage manufacturers to move to places where labour costs are cheaper – like India. India’s best choice would be to emulate China, said Panagariya, disagreeing with naysayers who argue that advances in labour-saving technology make that impossible .He highlighted Modi’s decision to build out India’s coastal ports to improve access to the world market for goods as one key initiative to expand India’s 1.7 percent share of world exports. At the same time, he advised against “tinkering” with borrowing targets, saying the government’s credibility was riding on its commitment to bring down the budget deficit to 3 percent of GDP over the medium term.