ISAS Briefs

The Japanese Prime Minister Shinzo Abe visited India from 25 to 27 January 2014 at a time when both countries are hunting for solutions for improving their medium-term growth prospects. ‘Abenomics’, as Prime Minister Abe’s economic policies are popularly referred to, succeeded in imparting a push to economic activity in Japan. Nikkei – the benchmark index at the Tokyo Stock Exchange – outpaced other indices in the region by touching a six-year high towards the end of 2013. The year saw Japanese GDP growing by 1.7 per cent, which was higher than the collective rate of growth of 1.3 per cent for the GDP of advanced economies. Among the G8 countries, Japan’s GDP growth last year was lower than only that of the US (1.9 per cent), while being on par with the UK’s and Canada’s.2 But the growth-inducing effects of the expansive monetary and fiscal policies taken by Abe last year might be shortlived with GDP growth expected to remain at 1.7 per cent in 2014 and moderate to 1.0 per cent in 2015 as the stimuli peter out.