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Wrong to blame China entirely for global rout: India Central Bank Chief
August 26, 2015, 9:05 am

has previously been chief economist at the International Monetary Fund (IMF) and a professor at the University of Chicago [Xinhua]

Indian Central Bank Chief Raghuram Rajan (left) has previously been chief economist at the International Monetary Fund (IMF) and a professor at the University of Chicago [Xinhua]

Indian Central Bank chief Raghuram Rajan has said it was wrong to attribute the problems in global markets entirely to China, as there were a number of other concerns too.

He told British broadcaster BBC on Tuesday that China has “become very important to the global economy”, and every adverse development anywhere in the world would certainly impact the rest as well.

“It works through financial markets first, then trade later. So it’s something that everyone is concerned about. But you have to be careful about attributing everything to China. There are a number of concerns about when interest rates will normalise around the world – and there’s also questions about whether some markets are just too high,” he said.

A day after China’s central bank lowered interest rates in an attempt to ease the crisis, most Asia-Pacific stocks suffered minor losses on Wednesday. Investor confidence was also hit by a last-minute plunge on Wall Street on Tuesday.

Meanwhile, Reserve Bank of India governor Rajan has also said it will be “a long time” before India can replace China as a growth engine for the global economy, even if it grows at a faster rate.

“India is one-fourth to one-fifth of China’s size. Even if we can overtake China in terms of growth rates, the magnitude of the effect will be far smaller for a long time to come,” he said.

China still remains the fastest-growing G-20 nation, even though the Asian economy is no longer expanding at the pace it did a few years ago. China’s economy grew 7.3 per cent in the fourth quarter of 2014 from a year earlier, and is expected to slow to 7 per cent in 2015. To counter that slowdown, People’s Bank of China policy makers are boosting monetary stimulus.

The Indian economy grew 7.5 per cent year-on-year in the Jan-March quarter outstripping China’s 7 per cent growth in the same quarter.

The latest figures show India is growing faster than China, the result of a new method of calculating GDP.

The new method of calculating India’s GDP measures economic activity by market prices instead of factor costs, taking into account gross value addition in goods and services as well as indirect taxes.

Economists, including the Indian government’s Chief Economic Advisor Arvind Subramaniam and the Central Bank Chief Raghuram Rajan have warned against rushing in to use the new numbers to craft policy.

 

TBP 

3 Responses to Wrong to blame China entirely for global rout: India Central Bank Chief

  1. vish Reply

    August 27, 2015 at 12:24 am

    It might have been Beijing “mindfully” reacting to Washington’s IMF Fun N Games but this is the scenario Gold Hoarders have been finger-crossing for. These sorts of bubbling/vacillation also indicate that the majority of “Market Gamblers” are in it for minting during The Swing/Whipsawing, Warren B’s Bull-Dropping about Buying & Holding being as contemporary a tale as any Toothfairy would have Her Mesmerised of Stupidity-Dumbness hoping, wishing & praying, pleeze g_d, that eet must be true, Divining The Markets being the preserve of Fixers/Shakers/Movers.

    The Chinese will keep cutting rates until they are forced to unveil their Gold Hoard – should they truly has an earth-shattering hoard – a chess game that Beijing & Washington are reluctant to conclude until there is no real choice left, both being conjoined by the same “Trade”. More the pity when their citizenry, whose awareness are tuned to Shopping, Entertaining, Politiking, Fianacing, etc., are seemingly mere innocents of The Swinging, Greed-Fear being the concept that keeps Humanity spinning.

    For the unwary, in “Ancient China”, which “The Chinese” keep pushing back the odd 1,000 years when and where possible, “Trading” is considered the lowest of profession because “Trading” liberates all that is inconsistent within human behaviour. In fact “Traders” are placed just above condemned criminals with both being automatically conscripted to The Frontline as “Arrow-Stoppers”, the historical version of “Bullet-Stoppers for Kinge & Country”” whenever “War” breaks out. Zounds, could history be repeating itself?

    How did The Gambling Industry came to running The Economy? A Casino, no matter how “euphemistically influential” the Greed-Fear, is never The Economy other than being the place gambling addicts exchange their money a free stay, free liqour and free prostitutes/rent-boys not to mention the free air-conditioning too. Only when Gambler Anonymous is running “The Country’s Administration” will An Economy be run as The Casino.

    Which of the 2 gambling addicts will blink first, one wonders. Perhaps Beijing’s massaging of The Marketeers via their Financial Arsenal might bear fruit. Not when Selfishness, aka Greed-Fear, is the The Numbers Game within The Zero Sum Game, Selfishness being conjoined to Gambling. And when it comes to Gambling, Addiction is Its Boss, The MO of every thinker being the Addiction to Self-Damage. Addicts like Barefaced Liars, “CEO’s”, and that joker par excellence, Uncle Tomee & his Kabalistic Kabin Krew. Yes, bring on The Real Armageddon and not this punk kid of some Ding Dong Merrily on High of Relative Armageddon.

  2. Kenneth Bohannon Reply

    August 27, 2015 at 6:41 pm

    It’s good to see you losers struggle. Fod Bless America!

    • roberto Reply

      August 28, 2015 at 8:59 pm

      shut up, little american geek

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