China’s economic woes a challenge to India: Jaitley

BEIJING: The slowdown of the Chinese economy and fluctuations in its stock market are among the external challenges facing the Indian economy, finance minister Arun

BEIJING: The slowdown of the Chinese economy and fluctuations in its stock market are among the external challenges facing the Indian economy, finance minister Arun Jaitley said, adding that New Delhi will focus on domestic demand to ensure growth.

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He said India was equipped to tackle external challenges like the “…possible rise of oil prices, political threats in the Middle East, fluctuation of China’s financial markets and the slowdown of the Chinese economy”.

The growth of China, the world’s second largest economy, has slowed down to less than 7% in several years. Last year, sudden volatility in its stock market wiped out billions of dollars.

In a globally integrated market, it had an impact on many countries, including India. But such challenges could be tackled in three ways, Jaitley said.

“First, India must cement its “firewall” to deal with challenges by ensuring a steady macroeconomic environment and properly managing its financial situation; secondly, due to the sluggish external market, India must rely on its domestic demand and Indian market to prevent the slowdown of economic growth; finally, India must continue its economic reform, launch reform policies so as to enhance people’s living standard,” the Indian finance minister wrote for the influential business and political magazine, Caixin.

Jaitley is on a five-day China tour where he will attend and address the ongoing first annual session of the China-led Asian Infrastructure Investment Bank (AIIB) besides meeting Chinese companies and potential investors.

In a separate interview to national broadcaster China Central Television, Jaitley said India’s growth rate of 7.6% in 2015 was not only sustainable but with a good monsoon this year, could be improved upon.