Demographics to Help India Overcome Virus Woes, Says Buchholz
Demographics to help a large population and continuing reforms will help India overcome its recent economic downturn.
(Bloomberg) -- A large population and continuing reforms will help India overcome its recent economic downturn, a former White House economic adviser said in an interview.
“Unlike China which has hit a giant brick wall on demographics, India is not facing that,” Todd Buchholz, former White House director of economic policy and author, said in an interview Friday. “Those investors who were lining up to invest in India in January 2020 will do so in 2021 also, and deregulation has to continue.”
Besides, Prime Minister Narendra Modi is viewed more favorably by global investors and as a result, investments should gather pace once the pandemic eases, he said, adding that the virus is a temporary phenomenon.
India’s 1.3 billion population -- set to overtake China’s in 2027 -- spells huge opportunities for countries like the U.S. and other western nations seeking to diversify their dependence away from Asia’s biggest economy amid rising trade tensions. On its part, India is trying to lure more global companies to set up shop by offering incentives.
India is also of “great importance” for the U.S. especially to act as a counter-weight to the growing influence of China, Buchholz said.
The U.S. views China’s Belt and Road Initiative to build ports and other strategic infrastructure in places such as Sri Lanka, Pakistan and Myanmar as paving the way for Beijing’s military influence overseas. At the same time, India’s own relations with China have deteriorated over a conflict along their disputed Himalayan border.
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