The price of its zero-COVID policy is now being paid by China with hurting its progress. As per China’s National Bureau of Statistics, the GDP growth rate of the country was merely 3% in 2022, which is the second-lowest rate in 50 years. Earlier, the rate was 2.3% back in 1974, which was the lowest. The Chinese government had aimed at a 5.5% growth rate for the year 2022. Due to long lockdowns in cities like Shanghai, industries faced heavy losses.
The situation of loss directly affected the youth which was looking for employment, and the unemployment rate remained between 5.5-5.7%, and out of every 5 skilled workers in China, 1 could not find a job. The size of China’s GDP in 2021 was 18, 000 billion dollars, which has now fallen down to 17, 940 billion dollars. This has happened because of the dollar getting strengthened in comparison to the Chinese currency.
From an Indian point of view, this crisis is China is a golden opportunity for India. As per DK Joshi, Chief Economist, Crisil, and Madan Sabanvis, Chief Economist, BOB, manufacturing has reduced in China, which means that exports will come down too, under these circumstances, India will have the opportunity to become China’s alternative for the world. This will lead to an increased number of jobs in India. With increased exports from India, the trade deficit will get reduced, with which Indian Rupees can get strengthened in comparison to USD. The Centre should identify the regions where China has got weakened in the global supply chain.
They added that foreign investors can pay more attention to India, and it is among the Centre’s primary objectives to increase foreign investments in the country, and this is the right time to work in this direction with full force and might. The direct implication of the growth of the second largest economic superpower China stalling is that India’s supremacy in Asia will augment, and we can move in the direction of becoming trade leaders in the region.