{"id":69975,"date":"2020-11-18T18:22:34","date_gmt":"2020-11-18T12:52:34","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=69975"},"modified":"2021-05-17T11:11:33","modified_gmt":"2021-05-17T05:41:33","slug":"asian-economies","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/asian-economies\/","title":{"rendered":"Asian economies"},"content":{"rendered":"<p><strong>Context:\u00a0<\/strong>The post-pandemic global economy has often predicted that China\u2019s appeal as a business destination would fade.<\/p>\n<p><strong>What are the various strategies that can be pursued post pandemic global economy?<\/strong><\/p>\n<ul>\n<li><strong>\u2018China +1\u2019 strategy:<\/strong>\u00a0The combination of the trade war and the COVID-19 crisis has resulted in firms establishing relatively small-scale operations elsewhere. This is perceived as a buffer against being completely dependent on China.<\/li>\n<li><strong>There are three reasons for firms to remain in China and pursue this strategy:<\/strong>\n<ul>\n<li>Starting an enterprise and maintaining operations in China are much easier than elsewhere.<\/li>\n<li>Chinese firms are agile and fast, which is evident from the quick recovery of Chinese manufacturing after the lockdown.<\/li>\n<li>Many global companies have spent decades building supply chains in China. Hence, getting out would mean moving the entire ecosystem, which involves time and expenditure.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Regional Comprehensive Economic Partnership (RCEP):\u00a0<\/strong>Asia\u2019s growth would hinge on the role of trade and investment flows into these economies.\n<ul>\n<li>This is expected to be the centrepiece of global growth, as the 15 member countries account for nearly 30% of the global GDP.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>The RCEP and the \u2018China +1 strategy\u2019 is likely to impact investment flows into Vietnam, India, Bangladesh and Indonesia, which have emerged as key investment destinations.<\/p>\n<p><strong>Suggest steps which can be pursued by countries like India to deal with the changed economic scenario.<\/strong><\/p>\n<ul>\n<li><strong>Public Investments:<\/strong>\u00a0The task of increasing domestic public investments, which have a central role in economic activity, for both demand and supply sides.<\/li>\n<li>In India, even before the pandemic, the growth in domestic investments had been weak, and this seems to be the right time to boost public investments as interest rates are low globally and savings are available.<\/li>\n<li><strong>Major overhaul in trade policy:\u00a0<\/strong>World trade had been rattled by tendencies of rising economic nationalism and unilateralism leading to the return of protectionist policies.<\/li>\n<li><strong>The two effects of the RCEP:<\/strong>\u00a0the \u2018Walmart effect\u2019 and a \u2018switching effect\u2019.<\/li>\n<li>The first would sustain demand for basic products and help in keeping employee productivity at an optimum level, but may also reduce wages and competition due to sourcing from multiple vendors at competitive rates.<\/li>\n<li>Switching effects would be an outcome of developed economies scouting for new sources to fulfil import demands, which requires firms to be nimble and competitive.<\/li>\n<li><strong>Export diversification:<\/strong>\u00a0\u00a0Major fallout of this \u2018policy dualism\u2019 is the dampening of export diversification. The challenge is to make exporting activity more attractive for all firms in the economy.<\/li>\n<li><strong>Increase women\u2019s participation in the labour force:<\/strong>\u00a0Women\u2019s labour force participation rate has fallen from 42.7% in 2004\u201305 to 23.3% in 2017\u201318. This means that three out of four Indian women are neither working nor seeking paid work.<\/li>\n<li>Globally, India ranks among the bottom ten countries in terms of women\u2019s workforce participation.<\/li>\n<li>India could gain hugely if barriers to women\u2019s participation in the workforce are removed, for which the manufacturing sector should create labour-intensive jobs that rural and semi-urban women are qualified for.<\/li>\n<\/ul>\n<p><strong>Way forward<\/strong><\/p>\n<ul>\n<li>India\u2019s approach to the changed scenario needs to be well-calibrated.<\/li>\n<li>The intensity of competition is evident from the fact that after India passed three labour code Bills on September 23, Indonesian Parliament on October 5 passed a legislation that slashes regulations contained in more than 70 separate existing laws, to open up the country to more foreign investment.<\/li>\n<\/ul>\n<blockquote class=\"wp-embedded-content\" data-secret=\"cf9wgD5kX0\"><p><a href=\"https:\/\/forumias.com\/blog\/air-india\/\">Air India: Knowledge Base<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Air India: Knowledge Base&#8221; &#8212; Free UPSC IAS Preparation For Aspirants\" src=\"https:\/\/forumias.com\/blog\/air-india\/embed\/#?secret=W29Y34tlT8#?secret=cf9wgD5kX0\" data-secret=\"cf9wgD5kX0\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Context:\u00a0The post-pandemic global economy has often predicted that China\u2019s appeal as a business destination would fade. What are the various strategies that can be pursued post pandemic global economy? \u2018China +1\u2019 strategy:\u00a0The combination of the trade war and the COVID-19 crisis has resulted in firms establishing relatively small-scale operations elsewhere. This is perceived as a&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/asian-economies\/\">Continue reading <span class=\"screen-reader-text\">Asian economies<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,1351,1310],"tags":[],"class_list":["post-69975","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-daily-news","category-daily-news-updates","entry"],"jetpack_featured_media_url":"","views":{"total":36,"cached_at":""},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/69975","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=69975"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/69975\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=69975"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=69975"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=69975"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}