THE IMPACT OF THE GLOBAL ECONOMIC CRISIS ON ASIAN TECHNOLOGY MARKETS (INDIA AND CHINA)

Lyudmila SHKVARYA, Olga GRIGORENKO, Andrei STRYGIN, Vasily RUSAKOVICH, Svetlana SHILINA


Lyudmila Shkvarya, D.Sc. (Econ.), Professor at the Faculty of Economics, Peoples Friendship University of Russia (Moscow, Russian Federation)

Olga Grigorenko, Ph.D. (Econ.), Associate Professor, Don State Technical University (Rostov-on-Don, Russian Federation)

Andrei Strygin, D.Sc. (Econ.), Professor at the Faculty of Economics, Moscow Automobile and Road Construction State Technical University, Full Member (Academician) of the Russian Academy of Social Sciences (Moscow, Russian Federation)

Vasily Rusakovich, Ph.D. (Econ.), Associate Professor at the Department of World Economy, Plekhanov Russian University of Economics (Moscow, Russian Federation)

Svetlana Shilina, D.Sc. (Sociol.), Associate Professor at the Department of Sociology and Social Work, Ivan Petrovsky Bryansk State University (Bryansk, Russian Federation)


ABSTRACT

Only 50 years ago, the Asian countries were among the poorest in the world. Since then, there has been a fantastic breakthrough: the regions total GDP has increased 10-fold, and Western investors are investing hundreds of millions of dollars in its previously high-risk markets. Todays favorable state of affairs is a result of the long way traveled by the region before it became an attractive and promising investment destination. At the same time, 2015 saw a decline in economic growth in many emerging market economies. Many of them, including Russia, experienced an external shock caused by a decline in exports, primarily due to an economic slowdown in China. In order to recover from the crisis, emerging economies should launch large-scale structural reforms, but the only major economy in Asia where such reforms are being implemented, at least to some extent, is India. China and India are two emerging economies, the second and ninth largest economies in the world, respectively. The latest forecasts suggest that inconspicuous India, largely oriented in recent decades toward the domestic market, will shortly surpass China and, according to the World Bank, by 2017 will be growing much faster than the latter. In the face of a global economic crisis, Chinas desire to become an innovation leader by 2020 is an important factor of global development. Goldman Sachs and the World Bank predict that Chinas GDP will exceed U.S. GDP within 20 years, roughly by 2030. The IMF forecast is even bolder: Chinas GDP will exceed U.S. GDP in 2016. This article is an attempt to analyze the economic potential and development prospects of India and China, the two largest emerging economies of the world, during the global economic crisis. Today there are both great economic opportunities for China and India and serious threats facing them. In the coming decades, China and India will be among the worlds leading economies in terms of GDP, but not always in terms of growth rates. Chinas development will slow down, including due to population aging and a labor shortage. India will have more resources for maintaining high development rates, but it too is expected to fall behind some other rapidly developing countries.

Keywords: India, China, economic development, technology transfer, economic crisis.


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