This paper is a review of the development that is fuelling the Chinese economy for the past decade, one which is expected to continue into the future as well. But as mentioned above, the country is facing all the challenges and problems associated with rapid economic growth. In the process of the review, the following factors or issues will also be considered. The first question is, whether it is prudent on the part of the Chinese Government to ignore associated problems like pollution in the short run, while it aggressively pursues its development policies. The Chinese government follows an authoritarian style with very little political/personal freedom of expression in the hands of its citizens. A review of this scenario will also be done here since this freedom is seen as essential for a well-balanced economic growth. The third issue is the rising levels of income inequality that is seen in the country. Finally, the role and importance of the Chinese legal system will also be reviewed with a focus on its ability to root out or at least control corruption and injustice faced by its citizens.There exists abundant literature on the environmental problems faced by the country. What becomes apparent is that environmental pollution comes from two areas, namely automobile emissions and effluent from its manufacturing units. An article in the online edition of the New York Times titled ‘China’s environmental crisis’ dated August 26th, 2007, provides a Flash supported map of the country showing different areas of environmental vulnerability and damage. One glaring fact is that the majority of the damage is seen in the Eastern part of the land and to a small extent along the northern border. The central and eastern parts are relatively left untouched by pollution and probable development as well. With regard to the quality of air, the article states that the air in many Chinese cities is the most polluted in the world (China’s Environmental Crisis 2007). For example, Beijing, one of the world’s polluted cities in terms of quality of air, the particles found are three times that is seen in Los Angeles. Water scarcity affects nearly 600 million people, nearly half of its population. The encroachment of desert and arid land is increasing and acid rain is common in many parts of the land especially in highly polluted areas.