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Monday, January 20, 2014

Total Chinese government spending since 2009.

It has been alleged many a time that data released by China is not always reliable. Take government spending for instance. As today's data shows, this has steadily increased every year since 2009. Government spending by itself has no meaning unless there is more clarity on which areas this money is being spent. In this regard, as per an article in CNN Money, significant chunk of government spending in China has been going towards education, employment and social security, agriculture, water and general public service. One may conclude that given the slowdown in the Chinese economy in recent times, an increase in wasteful government spending may not necessarily be good. But if the government is spending towards the areas mentioned above, then we believe it will reap benefits for the economy in the longer run. Indeed, the country does fare much better compared to India whose total expenditure largely consists of unproductive items such as subsidies and interest payments. 



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