He also said inequality has increased in both India and China.
"As was the case for India, in China you see that inequality has increased. From that viewpoint, you could advocate, you should advocate social spending and taxation reform in order to address that issue in China.
"At the same time, it turns out that increase in social spending and change in taxation does support the transfer of expenditure from investment to consumption. That is part of the overall rebalancing of the Chinese economy," Gasper said.
Gasper said globalisation and technological change have been major drivers of economic growth and cross country convergence.
"More than one billion people have been lifted out of extreme poverty since the early 1980s, and most of them come from China and India," he said.
"At the same time, when you focus on country indicators, you see that inequality has increased in most advanced economies and large emerging economies. Again, I am referring to China and India," Gasper said.
"The clear perception around the world of widespread increases in income inequality illustrates the dominance of national politics shaping these perceptions. Fiscal policies, government expenditures and revenues are powerful means to ensure the sharing of the growth dividend," the IMF official added.
News Source - Business Standard