As Chinese President Xi Jinping and Indian President Narendra Modi prepare to join world leaders at the forthcoming G20 meeting to examine progress on the 2030 Agenda for Sustainable Development, world renowned economist Jayati Ghosh will argue in her address at the Institute of Development Studies’ (IDS) Annual Lecture that growing inequalities are seriously undermining these efforts in China and India.
Despite China and India increasingly being seen as influential players on the world stage, Professor Ghosh will highlight that the perception of these nations as globalisation ‘success stories’, is being eroded by the realities of inequality and insecurity faced by the majority of their residents. Moreover, that the problems of persistent poverty, uncertain livelihoods and job insecurity, rising debt levels and the impacts of environmental damage, all paint a very different picture. These in turn are generating social and political pressures that may be hard to contain.
Around a billion people in both countries mainly rely on agriculture for their livelihoods, yet this is no longer economically viable or environmentally sustainable. However, there are simply not enough decent jobs created in other sectors, and young people and women are the worst affected by lack of decent work. In India, the hoped-for “demographic dividend” could turn into a nightmare if this continues.
Recent growth was debt-driven in both economies, which now have to deal with the hangover. Household debts rose because of housing loans as well as private health and education spending. In China, the necessary deleveraging by all sectors will have to affect economic activity. In India, corporate debt is a major problem, which is holding back investment and making banks unviable.
Rapid economic growth has created environmental destruction that poses threats and risks in both countries to people’s wellbeing. China is investing heavily in renewables and is becoming a global leader on these issues, but other environmental challenges loom large – and India faces ecological damage at a much lower level of per capita income and still has much to do in this area.
At the lecture, Professor Ghosh will stress that both countries can shift course towards more sustainable development. She will make the case for China to pursue more domestic market-led growth based on wage and employment increases and for the state in India to invest more heavily in infrastructure and public services that generate employment and improve the quality of life. More broadly, she will argue that these shifts, and learning from China’s and India’s experiences will be key to accelerating progress towards the Sustainable Development Goals for all countries.