Sachin R K, An introvert, suffering from Mephobia
Here it goes..
The average Indian was slightly better off than the average Chinese in the initial years after Indian independence. But China’s approach to development has varied markedly over the last 40 years and has been so successful that it now ranks as the second most important economy in the world. India has made good progress but is still substantially behind China.
In the first decade of this century, India’s growth reached a take off stage that prompted many people to ask when India would catch up with its neighbour. It was also thought that democratic India may even overtake China. Will that dream come true?
China and India, despite being such large countries, accounted for only 4.5 per cent and 4.2 per cent of global GDP in 1950 in Purchasing Power Parity (PPP$) terms. The ratio of China’s GDP to India’s was 1.18 in 1913 ($241 billion/$204 billion); in 1950 it was 1.08 ($239 billion/$222 billion). Estimates of per capita income made by Angus Maddison and Dharma Kumar suggest that India might have had a higher per capita income. However, there was not a marked difference in the level of human development.
Both countries, in the course of history, have feared foreign domination, have considered the state as the driver of growth and have suspected the private sector’s initiatives. For India, the problems were achieving unity in diversity and accommodating various languages and religions in a democratic set up. On the contrary, China’s hard state enabled it to pursue a single goal with determination and mobilise maximum resources to achieve its goals.
China experienced many problems in initiating industrialisation, but after some hitches, it switched to an all-round emphasis on heavy and light industries, and had a more successful resource mobilisation strategy than India did. As a result, Chinese manufacturing grew at 9.5 per cent, twice as much as India’s rate, from 1965-80. Also, China managed its agrarian reform better than India did.
“China has outrun India in every area of economic endeavour in the last 35 years, except in computer software industry and agricultural research”
The primary difference between the performance of the Indian and Chinese economy has been the faster growth of capital stock in China. With only a slight difference in the growth of employment, this translated into a more rapid growth of capital intensity. The growth of total factor productivity has also been faster in China. This appears to reflect a greater ease for labour to move out of agriculture into higher productivity sectors in China than in India. China has outdistanced India in every area of economic endeavour in the last 35 years, except in computer software industry and agricultural research.
India will most probably overtake China as the most populous country in the world in 2030. China is better placed structurally than India for a good economic performance, but it is most likely to be much lower than its recent average performance of about 10 per cent a year. How much lower it would be would depend on its ability to maintain current labour productivity levels and the benefits likely to flow from its proposed trans-continental rail system and other transport-related activities.
Troubles in China’s financial markets, a declining young and increasing older population as a proportion of the working age population, increasing wages in general and export industries in particular, costs associated with cleaning up serious environmental pollution, increasing competition from other countries in export industries using low-skill and semi-skill labour, lower savings rate and a possibly lower investment rate will have a negative effect on its growth.
India has an excellent chance of catching up with China if it can increase its labour force participation rate (particularly women), increase the average level of education, improve the quality of its labour force through special training programmes, reduce impediments to let foreign capital participate in its development process
Alfred W Croucher, has lived and worked in China since 1978. His post-graduate thesis was on GPCR.
Just from memory:
A. China's literacy is around 95% compared to India's 72%;
B. China's high speed expressway is around 123, 000km, India's is a few thousand;
C. China's High speed rail system is about 19,000km, India has none.
D. China's GDP per capita is around $17000, India's is about $7500 on a PPP basis.
There is much more which I would like to enlarge upon but time constraints don't allow. Anyway I'm not feeling charitable towards India since they knocked Australia out of the WT20 last night!
A price of a product or services depends on the GDP of the country. China and India is the two emerging economy of the world. China and India is 2nd and 9th largest country of the world, respectively in nominal basis. On PPP basis, China is at 1st and India is at 3rd place in 2014. Both country together shares 16.08% and 23.16% of total global wealth in nominal and PPP terms, respectively. Among Asian countries, China and India together account for 52.77% (PPP) and 48.99% (Nominal) of total Asia's GDP.
With the technological rise in India’s infrastructure, India has the fastest rate of growth when compared to any country in the world. More and more people are purchasing products online in India at cheaper rates.
There is an increase in the number of eCommerce websites in India making it possible for more number of people to purchase products online.
Hence with the rapid rate at which India is developing it has all the chances to beat China in all sectors.