ICAI FINAL INDUSTRIAL ORIENTATION TRAINING PROGRAMME

2015

jīng jì jiā

Team Members:

1. Amol Patil

2. Sagar Chavan

3. Amita Lokwani

4. Vishal Walzade

5. Abhishek Misal

6. Sachin Kahandal

7. Rupali Kopnar

Chinese Economy And Yuan

World's most populous country with a population of over 1.3 billion.

China is 3rd biggest country in the world in term of area.

The 1st in manpower (in term of population). 2nd economy (in terms of nominal GDP) of the

world after United State of America (USA). More than 700 million of its 1.3 billion people

live in rural area, The 2011 Human Development Report shows

China lies at 101 in a list of 187 countries China's economy during the past 30 years

changed from a centrally planned system to a more market-oriented economy.

Introduction :

Highlights:

Govt. Policies succeeded beyond expectations

Prices rose around 250% in around 2 years including a rise of 26% in a single month

Daily Turnover Quadrupled

Easy Money Initiated by Chinese Govt. to charge up Economic growth

Fact is that Stock markets experience Bubbles that eventually burst.

Market Drop is not surprising But the Speed is

Current Condition Of Chinese Economy

More recently it has become clear that there are serious problems in China’s real output of goods Due to import of fewer raw material and seemingly fewer exports of finish goods.

Causes for current economical problems:

Unsustainable levels of investment.

Inequality and weak welfare state hurt Chinese consumption.

Chinese politics.

High levels of debt.

Impact on Indian Economy :

Commodity.

Bad for automobile industries.

Stock Markets Down.

Decrease in foreign institutional investor investment.

Beneficial for Import of Oil & Gold.

Effect on Chinese Exports :

In

In China’s Domestic Market Traders are allowed to push the Yuan 2% stronger or weaker of the day. But the people’s bank of China often ignores those market signals when it sets the next day’s rate.

Chinese Yuan :

WHAT IS DEVALUATION OF CURRENCY:

It refers to decline in value of a currency with respect to other currencies, which is most of the times brought by central bank.

It should not be confused with term depreciation of currency which is a decline in currency value due to market forces without interference of government.

Impact Of Devaluation:

Chinese Commodity Cost

Effect On Indian Market

Small effect Of Growth

Impact On Indian FDI

Reduced Bank rate

Currency War