The Chinese government has indicated that it will not overly emphasize the rate of economic growth and will focus on the quality of growth.

This is a sensible move; not being attached to an ambitious growth target will give Chinese policymakers more space to carry out structural reforms. It will also help them move away from over-dependence on debt-fuelled investment-led growth. If China manages to make this shift and is able to manage the process of deleveraging successfully, it would significantly reduce the risk for the global financial system. China is the second largest economy in the world and a shake-up in its financial system can create serious disruption in global markets.

What does it mean for India? If India manages some of the near-term challenges to growth and regains the position of the fastest growing large economy in the world on a more sustainable basis, it will have a real chance to establish itself as a preferred destination for investment for an extended period, which will further boost growth prospects.

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