How can India and China be having an economic boom when their biggest consumer, America, has cut buying?

Question

How can India and China be having an economic boom when their biggest consumer, America, has cut buying?

Answer 1

The biggest consumer of China is still China; the biggest consumer of India is still India.  China exports 40% of  its GDP (and imports 32%); India, 23% and 26%, respectively (notice that India actually imports more than it exports).

Both China and India experience rapid urbanization and industrialization.  While export-oriented industries may be spearheading this change, they are far from the only places where change occurs.  China, for example, must build a city the size of Houston every year just to accommodate people moving to the cities from the countryside.  India is actually building new cities from scratch (read up on Gurgaon).

Answer 2

First and foremost, Keynes was wrong: you do not grow rich by unilateral spending/ consumption.

Second, China is starting to buy some of china's products and let's not forget the rest of the world.

It's about labor markets. India / China has a unique position on the world market right now. The issue is that they have rather cheap labor from a huge population. As such, numerous companies are moving there.

Also, it depends on how you measure "economic boom."

I laugh my head off about people complaining about poverty in American. Don't get me wrong, America does have poverty, but it's nothing like poverty in India/ China. There are an enormous amount of factory/migrant workers and there are parts of rural India/China where life has not significantly changed from 800 years ago.

The short and simple answer to your question is that it you have both:

a.) grossly overestimated the importance of America as a consumer (especially when the Chinese have bought lots of our government debt treasury bonds)

b.) Forgotten the lack of proper restrictions that are grossly lacking in those countries that appeal to the the unscrupulous.  (not only safety regulations but anti corruption measures as well. Bribery is the cultural norm in China).

Answer 3

Don't forget, in a period of economic growth such as the one these two countries are experiencing, income is also growing in those countries and so that means domestic consumption is growing rapidly. Quite simply: they have a growing population that is buying their own goods!