World Bank President Ajay Banga said that despite the possibility of a global slowdown in the first quarter of next year, India is anticipated to be shielded from its consequences due to strong domestic demand.
He said that “The outlook for the world economy is better than expectations, but there is more risk on the downside in terms of a slowdown in the early part of next year. Since India gets a lot of its gross domestic product from domestic consumption, even if the world were to slow down for a few months, India has a natural cushion against (it)”.
Furthermore, there were discussions between the Finance Minister, Ms. Nirmala Sitharaman, and the global lending head about India’s sectoral priorities, such as municipal financing, logistics, water recycling, and renewable energy grids, for seeking assistance from the World Bank Group in leveraging private investments, and how India and the World Bank could collaborate to further the Group of Twenty agenda, as India is one of the World Bank’s largest markets in terms of its portfolio.
The Finance Ministry said in a tweet that “The Finance Minister mentioned that bridging the knowledge and technology gaps is key to future economic development and the World Bank should accelerate efforts to share the Indian development experience with the Global South”.
Earlier in the day, during a visit to a skill centre in the national Capital, when asked about India’s potential growth in high-wage jobs, Banga remarked that India has an opportunity to capitalise on global firms’ efforts to build factories outside of China, as companies seek to diversify their supply chains.
He said “We need to understand where these jobs are. They are in technology, which is very few… then they are in manufacturing. I think India’s opportunity currently is to cash in on the China Plus One opportunity. This opportunity won’t stay open for 10 years. It is a three- to five-year opportunity when supply chains start relocating or add another location that is going to need work”.
His remarks follow recent investment announcements in India by US corporations, including chipmaker Micron Technology, as the US seeks a strong counterweight to China in Asia amid rising tensions. In recent years, numerous corporations have pursued a China Plus One strategy to establish additional production operations outside of the People’s Republic.
