In 2009 “India maintained robust growth (6.7%) without Beijing’s hefty stimulus of $585 billion in part because it is less exposed to the international economy. China’s exports represented 35% of GDP compared with only 24% for India in 2008. Thus India was afforded more protection from the worst effects of the financial crisis in the West, while China’s government needed to be much more active to replace lost exports to the U.S. More significantly, though, India’s domestic economy provides greater cushion from external shocks than China’s.”
Private domestic consumption accounts for 57% of GDP in India compared with only 35% in China. India’s confident consumer didn’t let the economy down. Passenger car sales in India in December jumped 40% from a year earlier.
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