Strong supervision will ensure quality growth
After the annual sessions of China’s top legislature and political advisory body, the leadership elected at the 19th National Congress of the Communist Party of China will fully assume its new duties and, noticeably, lead China on the way to achieve high-quality economic growth.
The resistance to economic globalization that has built up over the last few years has much to do with the poor quality of economic growth in many parts of the world. Greater emphasis on achieving higher and higher rates of economic growth has become an obsession for several countries, particularly among emerging markets. The obsession has led to over-exploitation of resources. Natural resources such as water and mineral deposits have been ruthlessly exploited leading to serious ecological degradation and damage to the environment. The consequences are visible in China, which, for the last few years has been trying hard to make its economic growth environmentally sustainable.
Greater attention to the rate of economic growth, as opposed to its quality, has also created problems of distribution. In spite of emerging markets such as China growing at high rates, the benefits of the growth have not been equally shared by all. This has widened the income gap among various sections of society.
Inequality has always been a difficult issue for any leadership to tackle since it gives rise to both political and social unrest. Managing inequality therefore becomes a major public policy challenge for leaderships. As a result, along with the rate of growth, countries now also have to pay attention to a balanced pattern of distribution.
Ensuring high-quality growth is not easy. The most difficult part of the challenge is in managing institutions. Industries, businesses, households and innovations must adapt and respond to the target of maintaining the quality of growth. But they might not be able or willing to do so given their habit of pursuing high growth.
It is therefore important to have strong regulations for making them adjust to the challenge of high-quality growth. But it is not enough to have just regulations. The leaderships have to make sure the regulations are implemented by institutions that are vigilant on growth. The most important institutions in this regard include ministries and government departments — both at the federal and local levels — courts and other regulatory agencies.
The task of ensuring regulatory efficiency requires strong political leadership, which will see to it that all those participating in the process of economic growth are rewarded according to their contributions. The leadership must also ensure that economic expansion, whether through greater use of natural resources or technological innovations, should not come at a high cost for the people and society.
And this can happen only if the emphasis on the quality of growth and its distribution are maintained through strong regulations and checks on over-exploitation.
As regards India, there is an increasing internalization of its growing asymmetry with China. Multilateral forums have been especially useful for addressing it. Given that the media don’t raise exceptions for bilateral breakthroughs, the environment of ease at such forums helps enhance mutual understanding. This was the case during the Donglang (Doklam) border standoff when a series of multilateral meetings in run-up to the 2017 BRICS Summit in Xiamen, East China’s Fujian province, facilitated China-India dialogue at various levels resulting in a peaceful resolution to the crisis.
India’s External Affairs Minister Sushma Swaraj and Defense Minister Nirmala Sitharaman will visit Beijing in April, just two months before 2018 Shanghai Cooperation Summit in Qingdao, East China’s Shandong province, which will be attended by Indian Prime Minister Narendra Modi. India is also keen to host President Xi again, who paid a state visit to India in September 2014 and again in October 2016 to attend the BRICS Summit.
The bilateral trade volume, which hovered around $70 billion a year for a decade, made an impressive leap of 18 percent growth in 2017 reaching $84.45 billion. And nearly 40 percent of growth in India’s exports has raised hopes of addressing its big trade deficit with China. In this backdrop, 2018 may see an accelerated pace in reviving several old initiatives and starting new ones. This should facilitate the flow of China’s already contracted investments into “Make in India” that had become dormant given the nature of bilateral interactions during last two years.