China implemented economic reforms in 1979 that dramatically increased its annual real GDP growth from 5.3% before the reforms to 9.5% after. This allowed China's economy to double in size every eight years. However, growth has slowed in recent years due to the global economic slowdown in 2008 and is projected to continue slowing. The reforms decentralized economic policymaking, gave enterprises more autonomy, liberalized trade, and provided incentives that attracted massive foreign direct investment and boosted exports, industrial output, and urban employment. The rise of China has significantly impacted production and trade in several major industries globally like electronics and machinery. The ongoing trade war between the US and China creates new opportunities for India to increase exports, reduce its trade deficit, and

1. China’s rise and its challenges
Presented By : Heerak Choubisa
Division – B
Roll No. - 19070
Presented By : Heerak Choubisa
Division – B
Roll No. - 19070

2. Introduction
• Condition before Reforms
• Before the Chinese government introduced several economic growth
reforms in 1979, the average annual real GDP growth rate in China was
estimated at 5.3% (from 1960-1978) according to the Congressional
Research Service.
• Its gross domestic product has surged less than $150 billion in 1978.
• Condition after Reforms
• From 1979 to 2018, China's annual real GDP averaged 9.5%. This has
meant that on average China has been able to double the size of its
economy in real terms every eight years.
• The global economic slowdown, which began in 2008, had a significant
impact on the Chinese economy. China's media reported in early 2009 that
20 million migrant workers had returned home after losing their jobs
because of the financial crisis and that real GDP growth in the fourth
quarter of 2008 had fallen to 6.8% year-on-year.
• The IMF's April 2019 World Economic Outlook projects that China's real
GDP growth will slow each year over the next six years, falling to 5.5% in
2024

3. Reforms by China
• Price and ownership incentives for farmers
• Established four special economic zones
• Decentralize economic policymaking in several sectors
• Economic control of various enterprises was given to
provincial and local governments
• Citizens were encouraged to start their own businesses
• Additional coastal regions and cities were designated as open
cities and development zones
• State price controls on a wide range of products were
gradually eliminated
• Trade liberalization

4. Foreign Direct Investment (FDI) in China
• China's trade and investment reforms and incentives led to a
surge in FDI beginning in the early 1990s. Such flows have
been a major source of China's productivity gains and rapid
economic and trade growth. There were reportedly 445,244
foreign-invested enterprises (FIEs) registered in China in
2010, employing 55.2 million workers or 15.9% of the urban
workforce. FIEs account for a significant share of China's
industrial output. That level rose from 2.3% in 1990 to a high
of 35.9% in 2003, but fell to 25.9% in 2011. In addition, FIEs
are responsible for a significant level of China's foreign trade.
At their peak, FIEs accounted for 58.3% of Chinese exports in
2005 and 59.7% of imports, but these levels have
subsequently fallen, reaching 41.7% and 43.7%, respectively,
in 2018

5. Comparative Growth History

7. What India can learn from China's 70 years of growth
• The first, and probably the most important thing that China
did well right from the start was its focus on human
development.
• The second key difference was the focus on the type of
industries by the two countries.

8. Major Industries affected by rise of China
• Electronic equipment: Smart phones
• Machines, engines, pumps
• Organic chemicals
• Fertilizers
• Iron and steel
• Plastics
• Iron or steel products
• Gems, precious metals
• Ships, boats
• Medical, technical equipment

9. Trade war between USA and China

10. Opportunities for India by Trade war
• Export
• Trade deficit
• Investment
• Tourism