China and India: drawing lessons from what works
| Author | Jahangir Aziz/Steven Dunaway/Eswar Prasad |
| Position | IMF Asia and Pacific and Research Departments |
| Pages | 323 |
Page 323
The dynamic economies of China and India, two of the fastest-growing emerging market countries and among the three largest economies in Asia, are having far-reaching effects on the global economy through, for example, their impact on world trade, their demand for energy and other commodities, and their huge accumulation of foreign currency reserves. What does the future hold? How can each continue to grow and develop in a sustainable way? And what lessons can the two countries draw from each other's experiences? A new book from the IMF, China and India: Learning from Each Other, attempts to address these questions.
The book's authors-policymakers and practitioners-infuse analytical material with a strong dose of pragmatism and policy relevance. Reserve Bank of India Deputy Governor Rakesh Mohan discusses how the forces of globalization can complicate the challenges facing monetary policymakers in emerging economies such as China and India, and Governor Zhou Xiaochuan of the People's Bank of China contrasts the growth of the services sector, including financial services, in China and India and weighs the importance (and difficulties) of developing this sector in China.
The book takes a particularly close look at some of the reforms that will be needed to secure sustainable development.
Banking sector reforms. According to Nachiket Mor, R. Chandrasekhar, and Diviya Wahi, many dimensions of India's banking sector have improved, but further reforms are needed to strengthen the financial services infrastructure, reduce the cost of intermediation, and broaden access to financial services, especially in rural areas. Nicholas Hope and Fred Hu enumerate the priorities for Chinese banking reforms and assess the role that foreign strategic investors could play in the reform process. Luo Ping compares the efficacy of the regulatory structures and reform processes in both countries and suggests that the Indian experience may provide some useful lessons for Chinese policymakers.
Development of securities markets. In two separate studies, G.N. Bajpai and Narendra Jadhav catalogue the development of equity, corporate debt, and government securities markets in India and discuss how policy reforms have contributed to these outcomes. In an examination of China's securities industry, Xinghai Fang, Ti Liu, and Donghui Shi argue that opening up the...
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