A study of Economic complexity of Indian Exports Vis-à-vis China: A Review Paper based on Atlas of Economic Complexity theory

Purvi Pujari,Srilalitha Sagi,Sachin Napate,Anuj Kumar

doi:10.32725/acta.2021.011

Abstract

As the world tries to grapple with the aftermath of the COVID-19 pandemic, there are concerns about the revivals of economies across the globe. The world is also trying to make sense of global restructuring trade, which is expected in the post-COVID-19 world. This paper attempts to analyze the emerging trade scenario between India and China. Atlas of Economic Complexity theory (ACE) by Ricardo Hausmann, Cesar A. Hidalgo has been taken as a base for this research. This study propagates that the countries with products that require more know-how have more potential to grow. Taking the Atlas map giving details of Indian exports as a base, the researchers have compared the data from the last two years. The purpose is to identify whether the complexity of Indian exports is increasing or not. A particular case study has been done on Indian exports to China. There has been little progress in this field as India is exporting more complex products slightly to China. There is an urgent need to formulate a strategy to enhance the complexity of Indian exports. The policymakers need to give impetus to the industries which have a cross-cultural demand in China and leverage this opportunity. This will open the path for consolidating India's position in the global trade as well as improving its strategic position vis-a-vis China.

Highlights

IntroductionForecasting economic growth has been based on the Gross Domestic Product (GDP) of a nation
Forecasting the growth of a country is a fascinating and tempting phenomenon
The researchers have taken a base of the products which are exported to China needs to be more complex, i.e., they need to be products requiring more know-how and technical knowledge

Summary

Introduction

Forecasting economic growth has been based on the Gross Domestic Product (GDP) of a nation. The macroeconomic parameters like GDP, per capita income, and employment which has been traditionally used to predict growth, have their limitations. These parameters, though they are a perfect mirror of the current position of the economy, are usually unable to show a clear picture of the future. Exports have always been a better reflection of industrial development and the growth potential of any economy. Growth prospects are more in the countries which export complex products (Felipe, et al, 2012). For an emerging economy like India, it is essential to understand and analyze its exports and predict their growth.

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