BUSINESSWEEK

China will overtake the US as the world's largest trading nation by 2016, as intra-Asian commerce and rising demand from emerging markets boost shipments, according to HSBC Holdings Plc.

Trade in China and the Asia-Pacific will grow at an annualized pace almost twice as fast as the world average over the next five years, driven by shipments within the region and expanded ties with Latin America, the Middle East and North Africa.

Demand from traditional consumer markets in the West is expected to slow as the evolving European debt crisis threatens the global outlook.

China, the world's second-biggest economy, will stimulate growth with fiscal stimulus and an acceleration in infrastructure projects, raising its imports of commodities from Latin America and the Middle East, HSBC said.

HSBC estimates the value of China's trade will rise at an annualized rate of 6.6 percent over the next five years, compared with 6.5 percent gains for Asia and 3.8 percent for the world.

China's share of global imports and exports will increase to 12.3 percent in 2026 from 9.8 percent last year.

BUSINESS STANDARD

China has taken tough steps to resolve speculation in property, in contrast to India.

In India, while developers have complained about high interest rates, inability to get loans from banks and build-up of inventories, precious little has happened in terms of correction in prices. According to National Housing Bank's Residex data, Kochi, Hyderabad and Kolkata have observed some drop in prices in the past year. But Mumbai, Delhi, Chennai and Pune continue to rise. In Delhi, prices are up by a whopping 35 percent.

Perhaps, it is time a tough model is followed to curb speculation. Second or third-home purchases can be made significantly expensive, like in China.

In 2010, when State Bank of India was offering its so-called teaser rates, former deputy governor Usha Thorat criticised it, saying "lower interest rates in the beginning actually lure borrowers. This, itself, has the making of leveraging and putting pressure on housing prices to move up."