By Nobuhiro Takahashi, Advisor, Japan Chamber of Commerce and Industry in India (JCCII)
A recent invitation to India to participate in the prestigious G7 Summit is a good opportunity for India in many ways.
But this development has irked India’s neighbour China for it has not received the invitation for G7 Summit happening in September. Russia, Australia, and South Korea also have been invited to this mega event.
In my opinion, India needs to be careful about China’s current and potential subtle moves, and not trust its glib peace talks.
India can utilize the opportunity to take Official Development Assistant (ODA) from Organisation for Economic Co-operation and Development (OECD). The amount from OECD might be required some Trillion INRs to enhance the liquidation of funds or money inside India.
G7 is the group of top seven developed economies – US, Japan, UK, France, Germany, Italy, and Canada. China does not figure in this group despite being the second top economy of the world.
When we dig into the past, especially in the 1980’s China had started Market Economy from Deng Xiaoping. China’s First Strategy was to take Official Development Assistant and attract Foreign Direct Investment (FDI) from OECD countries.
To achieve that goal, China created a disguised Constitutional impression towards the world, however, the nature of China might be the infringement of human rights in order to earn money. It is very much evident from China’s market economic activities revolving around 1989 when Tiananmen Square protests erupted in China.
Post COVID-19 pandemic, China seems too much concentrated on its domestic matters when we see recent its activities like the infringement of democratic rights in Hong Kong.
As China addresses domestic matters under the garb of its traditional strategy of giving a false friendly impression, China delivers the same soft and friendly impression while handling foreign affairs too. Once domestic matters are addressed successfully, it shows its true colours with a tough face impression.
China might try to start giving friendly impressions to India, however, their nature is crafty. In my opinion, China’s latent intentions might include creating a direct Asian continental Industrial Corridor through the Indian Ocean, and like China-Pakistan, China-Drachm-Bangladesh and China-Myanmar. The recent Ladakh and Drachm incidents are clear manifestations of China’s intention.
It is high time that India might closely observe and understand China’s hidden intentions, and need not get confused and carried away by China’s false friendly impression strategy.
Open Indo-Pacific Ocean strategy with India, US and Japan might support to realize India’s Economic Freedom with defense and security. I strongly wish all the success of India in G7.
Today, unfortunately, only one economic system working well is the global market economy. India is a true constitutional country respecting fundamental rights as per its constitution. India might be on the way to realize true economic freedom, not-depending on its economic activity in a specific country.
Infrastructure and basic industrial infrastructure could be developed using Official Development Assistant from OECD. The Indian income tax might be used to the education of the young generation to carry forward the market economy of New India.
One of the important strategies for India to realize huge ODA and FDI through G7 might be to appeal the ease of doing business, de-regulations in many activities such as taxation, not only in the past but also in the future. This year historical significant decision of Parliament was made to abolish DDT and in the year 2016, it was GST.
The strategy of the economic activities as New India, after the covid19, might be under consideration by the Central Government. And one more step towards ensuring ‘ease of doing business’ might be the abolition of “deemed dividend”. Instead of Deemed dividend, simple control as a clear contract between companies might be sufficient for the liquidation of funds or money in India.
That is not so much directly related to foreign-invested companies, however, one of the current agendas of the Indian economy is to enhance the liquidity, flow of funds, or money circulation in the domestic economy in India.
Receiving huge ODA from OECD, without enhancing liquidation of funds, it will be difficult for the Indian Economy to grow.
I hope the strong intention of the Indian Government will accelerate the ease-of-doing-business, de-regulation, to enhance Indian economic activities by enhancing the liquidation of Fund, for India’s prosperity.
About the author:
Nobuhiro Takahashi, Advisor, Japan Chamber of Commerce and Industry in India (JCCII) Suggestion Activities is the Managing Executive Officer with a well-known Japanese auto component manufacturing company in India. He has been living in India since 2008.
