Greater integration and interaction between India and China especially in the infrastructure sector will drive economic growth of both Asian giants, said Dr Montek Singh Ahluwalia, Deputy Chairman, Planning Commission of India.
Shanghai, Nov.15 : Greater integration and interaction between India and China especially in the infrastructure sector will drive economic growth of both Asian giants, said Dr Montek Singh Ahluwalia, Deputy Chairman, Planning Commission of India.
Speaking at an event organised by the Confederation of Indian Industry (China Office) and China Economic Review with the support of the Indian Consulate General in Shanghai, Dr. Ahluwalia said the target to enhance the bilateral trade between India and China to 40 billion dollars (Rs 1.6 trillion) by 2010 would easily be met before the deadline. However, we need to think 20 years ahead and set a more ambitious target, where the composition of Indian trade should reflect products of contemporary India such as software, pharmaceuticals and engineering, he added.
Speaking before the forthcoming visit of Prime Minister, Dr Manmohan Singh to China to further strengthen the bilateral relationship, he said that India had a lot to learn from China on the infrastructure front. "China's success in infrastructure is well known worldwide, the challenge now is how do we make Mumbai, a Shanghai", he said.
Dr Ahluwalia suggested public-private partnerships to build infrastructure facilities in India. He said India presented huge investment opportunities for Chinese and other foreign companies in infrastructure construction. The Indian Government has outlayed an investment plan of about 500 billion dollars over the next five years in infrastructure at the current dollar rate, with about 40 percent of that going towards power generation. India currently invests about five percent of its GDP in infrastructure and at the end of the 11th 5-year plan would increase it to about nine percent of GDP.
As the Indian economy expands, demand for investment in higher education would rise enormously. He stressed on public-private partnerships in the education sector also to meet the target. India would require major up gradation of vocational and higher education institutions to meet India's growing demands. As for the healthcare sector, Dr. Ahluwalia said he was glad to see Indian pharmaceutical companies operating in China and exploring market opportunities in both geographies.
China is the fastest growing economy in the world to day, about three times that of India and boasts per capita income about twice that of India. While India is not yet the fastest growing economy, growth has been accelerating at an average rate of 8.5 percent over the last five years, and will continue to accelerate at approximately nie percent over the next five years.
Nonetheless, it is projected that by 2030, China will be the largest economy globally, followed by the United States and India. Our political and economic systems are different, China's rate of investment stands at 45 percent of its GDP, it is possible for India to raise its rate of investment to 35-36 percent of GDP if the economy continues to grow at nine percent, Dr Ahluwalia added.
ANI