The Indian Economy Blog

September 27, 2005

China v India

Filed under: Growth,Miscellaneous — Amit Varma @ 8:57 am

It’s like Mike Tyson at his peak versus Keshto Mukherjee. That’s more or less the gist of Shankar Acharya’s comment piece here. Check it out, especially, the table.

Anything you’d like to add or argue with?

27 Comments

  1. In the long term, I think India will have it all over China – for a number of reasons. I detail the case against China here, and the case for India here. Enjoy.

    On the website of the linked article above, I notice there’s another link to an article titled “The Age of Chinese MNCs is Here”. Anyone who knows anything about how the mainland Chinese do business will realise how ridiculous that statement is.

    Comment by James Waterton — September 27, 2005 @ 11:13 am

  2. Inroads in exports, foriegn direct investment and tourism will give us a bright future

    If India can somehow manage to make inroads in the Chinese export market along with attracting the phenomenal foriegn direct investment that the Chinese enjoy, then we have hope.(which poured in at a rate more than 10 times higher than into India….why won’t there growth be greater)

    Another area is tourism … some 33 million arrivals (exclusive of Hong Kong), compared to less than 3 million into India.

    Comment by Mani Pulimood — September 27, 2005 @ 4:59 pm

  3. I have lots of friends from China and I discuss these issues all the time. My sense is that chinese tend to sweep lots of things under the carpet (e.g., discontent of rural people who have been largely left out of the economic development). If and when China opens up the anger of the rural folks will be out in full force and this may create some serious problems.

    Comment by sv — September 27, 2005 @ 10:56 pm

  4. The table presents some sobering statistics.

    IMO, the most striking stat is the female adult literacy rate — 87% in China versus 45% in India. And this is where India’s government has failed most. As I’ve said earlier, the government’s subsidies of higher education are a mistake.

    http://indianeconomy.org/2005/09/16/from-%e2%80%9cnehru-growth%e2%80%9d-to-productivity-surge/#comment-259

    That having been said, I think China has some serious problems as well, which aren’t reflected in the table — China’s banking system’s non-performing loans are many multiples of India’s.

    Comment by Prashant Kothari — September 28, 2005 @ 4:25 am

  5. And China’s enormous State Owned Industrial sector is largely bankrupt. China’s banks have so many bad loans because the central government keeps forcing them to loan money to these companies that will never repay.

    China’s current boom is being fuelled by the massively stimulating effect of US$60 billion+ pa of FDI. There is a lot of irrational exuberance regarding China – it’s a classic bubble. And it will burst some time soon.

    Comment by James Waterton — September 28, 2005 @ 5:26 am

  6. I am not so sure about the literacy figure – seems a little too high. A friend (from China) told me that primary education is not free, and it is quite common for people to not attend school.

    Comment by Karthik — September 28, 2005 @ 5:44 am

  7. I once shared a cubicle in the office with a Chineese guy. He told me the following things over a period of time…

    1. You simple cannot log onto a site like bbc.co.uk, because the state controls information.
    2. He was not aware of a profession called “lawyer” till he came to the US – because there is no such concept as a court room
    3. He is an atheist. But his mother is a member of Fauln Gong(am I spelling it right?) and she was arrested once – for no reason.
    4. You cannot be blogging like this in China.
    5. You do not get to watch all Hollywood flicks. The state heavily censors and only movies which are not political are allowed in.

    I think I would trade a bit of wealth to have the above, any day.

    Comment by Nilu — September 28, 2005 @ 10:29 am

  8. In that case can comparisons be drawn with Russia under Stalin where rapid industrialization was promoted at an exhorbitant cost to human lives??

    Comment by Mani Pulimood — September 28, 2005 @ 12:53 pm

  9. The article is bloody well one-sided, and could possibly be culled from a few minutes spent googling. That someone even paid to have it done is idiotic. And not to mention rediff hosted it.

    All it does is look at the past 20 years and paint a dismal picture for the next 20 years.

    That the author and says we wont or cant do it the next 20 years is also the Chief economic advisor to the Government of India is a bloody shame.

    Comment by Prasanna — September 29, 2005 @ 9:33 am

  10. The article is bloody well one-sided, and could possibly be culled from a few minutes spent googling. That someone even paid to have it done is idiotic. And not to mention rediff hosted it.

    All it does is look at the past 20 years and paint a dismal picture for the next 20 years.

    That the author says we wont or cant set a better pace economically the next 20 years while being the Chief Economic Advisor to the Government of India is a bloody shame.

    Comment by Prasanna — September 29, 2005 @ 9:37 am

  11. India and China are similar in one respect only which is population.
    Culturaly they are very different and therefore indians should not BLINDLY FOLLOW china’s economic-political model.
    China is a military state. Forget Friedmans nonsense. Most chinese are happy with this arrangement. Yes this is a shocker to some one who has lived in India and America. I am allways surprised whenever I talk with chinese students in US. They allways repeat the party line from back home on every issue and dont offer much else.
    Indians have more of an independent streak. Talk about any issue and you will hear different views.
    So the forms of political,economical and social structures both countries will have should be different.
    While china’s economic growth can be admired for what it is. India needs to find its own path for growth.
    But a lot of indians have a bizzare attraction towards the chinese model.

    And while some people like to raise issues about the lack of personal freedom in china including free press eg

    You do not get to watch all Hollywood flicks. The state heavily censors and only movies which are not political are allowed in.

    India does not have all these freedom either. eg
    India banned Rushdie’s Satanic Verses. VS Naipauls early books on India were banned in India(I dont know current status) Movies are censored in india(Its not a voluntary rating system like that in US)

    If india was to give up what ever little freedom indians have inorder to adopt a chinese influenced model, it will mostlikely collapse.

    What india needs is more decentralization and more privatization and things will take off. There is no need to create state run or state aided companies. It does not need to create a 3rd tier networking manufacturer like Huaweie which is a messy operation in bed with chinese military and engaged in IP theft rather than technology development. see links http://gigaom.com/2005/08/19/huawei-backlash/
    http://infoworld.com/article/03/06/10/HNciscorule_1.html

    Comment by Guru Gulab Khatri — September 30, 2005 @ 9:21 am

  12. apologies for the double post. thought it hadn’t gone through!

    Comment by Prasanna — September 30, 2005 @ 9:58 am

  13. The gulf in economic growth (even if it is bounded to select geographies and sub-groups) is not appreciated well enough by most of our commentators, policy-makers and administrators. To that end, the article does an excellent job in holding up the mirror. However, the article does not (as some previous comments above point out too) tip its hat to the benefits of pluraism that India has. I have written earlier about these topics at my blog, Saara Aakash – on disparities in financial system’s performance and on not being subjected to the absurd brutalities of the communist regime.

    Comment by Nikhil — October 5, 2005 @ 12:25 am

  14. What a stupid analogy comparing India and China. China has already lost the race. India has kept its people free and they do not have to behave like mutants or toe the party line. We are a much older and civilised people with everyone able to talk freely. Come on, think back to Tianammen Square the murders of Chinese liberals by the State … forget about the economy …. India will survive anything.

    Comment by salim — November 8, 2005 @ 8:45 am

  15. the head start that china enjoyed in opening its doors to global economy in 1978 , is one of the causes why the indian counterpart is lagging behind , but that certainly doesnt mean the has lost the way , because we compare the two economies we find that despite the high growth rate achieved by china , the indian counterpart has made rapid strides to catchup with the dragon ,

    Comment by abhimanyu rai — November 10, 2005 @ 11:11 am

  16. diffrent between india and china
    ~~~china bigger than india 3 time that mean the cost build a factory more cheap when the india population same as china now than the india will lack of land + somemore reserve for forest military purpose and road !the most biger problem for india !!
    ~~~india IT techonology is sure sure sure win china but in technology in space or nucklear bom (1970 something china fist test then 2 year later they tested for hidrogen nucklear bom) or the nucklear summarine(1980 the first china nucklear summarine is tested) is far far behind !!!

    Comment by dk — January 8, 2006 @ 9:20 am

  17. Reply to Nilu
    Every country has its own problems, you cannot critical on some specific points simply based on one opinion. some people may use this means to condemn chinese government. For example, you don’t familar with the chinese situation on the FalunGong,it is a kind of evil heresy, and will mislead people to kill other people or their family and themsevles, this is turely happened within many people who join FalunGong. and that is why the police arrest that saphead’s mother, things happened must be reasons!!!

    Comment by chinese — January 13, 2006 @ 7:54 am

  18. http://neweconomist.blogs.com/new_economist/2005/10/china_vs_india_.html

    look this chart !
    don not predict without prove!!
    from the figure about all the figure show tat india lose to china !! more abviously in education ,facility

    if u think the china no poured lot money in to high tech research u are wrong !! they create lot of high tech thing like space shuttle ,their own gprs system and 3 satelite, recently 2 new jet fighter born jf and j10 ,they also invent the cpu,godson II it speed about pentium 3 the research still continued .and the biotechnology!!the 3g system china invented lately approved by goverment td-cdma.and the brand new nueklear sumarine !they also research in high tech sensor to use in space ship!

    moreover china is 3 time larger than india in aspect of land!and china population is 30% more than india! with this figure india more density compare with china !!!this is not good thing !!if we cut out the land for road ,house,shop,military purpose,forest then india will suffer from insufficient space for continue grow!!

    IMO, the most striking stat is the female adult literacy rate — 87% in China versus 45% in India. And this is where India’s government has failed most. As I’ve said earlier, the government’s subsidies of higher education are a mistake.

    Another area is tourism … some 33 million arrivals (exclusive of Hong Kong), compared to less than 3 million into India.

    Comment by dk — January 24, 2006 @ 5:06 pm

  19. i think instead of pointing china for its lack of dimocracy, press freedom…etc..we should see positive aspects of the china like economy growth, administration etc….and also we should look how we can blend our economic model with the chinese economic model this will help india achieve success more quickly.

    Comment by barani — October 7, 2006 @ 12:25 pm

  20. As you may notice most of our previous colonies are christian, much more christian than the west!!! The reason is simple, we imposed the religion as the master so that we can control the slaves’ mind. We manipulated them so that they really believe in a belief system. Of course we are not fooled by our own trick!!!

    I have been to China. It does has its own problems. However, much of the truth about China that you guys believe in are manipulated truh. The reason is simple, we (the western ruling elite ) would like the rest of the world to believe in it. The reason? To legitimize our system and power over you!! And of course the Chinese government has their own propogandy to control its own people. But are we really different in that sense? Please do not feed me any words that a US president would say before we rage a war against some country.

    BTW, our propoganda may not be working very well in the west, but at least it is doing its magic in India…

    Comment by slacker — November 14, 2006 @ 10:57 am

  21. india cannot overtake China, ever. Why?
    Japan, Korea, Singapore, China have transformed less then a decade while india lags behind as always.

    india is plaged by multi-religious, multi-cultural nonsense and there is no unity or sense of social justice among your people, just dog eat dog. China is unified and people work hard for the country and people. We get things done, quickly.

    We took Tibet without a fight, we taught you a lesson in humility in the 1962 war and surely we will humiliate you again as we come as rich tourists and you worship us as Gods. :)

    Comment by Wuhan — December 22, 2006 @ 5:02 pm

  22. I was from Taiwan and have been in the US for 30 years. I have many classmates from India in graduate school. To be honest, most of the comments by the Indian readers on China or India are deadly wrong. It reflects the fact and the reason that India was easily colonized by England for more than a hundred years. India has the so-called “superior” democracy system after independence from England for 50 years. What this “superior” system has done to India in the last 50 years? What would you expect for next 50 years? I have three Indian neighbors here living in the 2 million US dollar houses. I have many more Chinese neighbors here living in 2 to 3 million us dollar houses. India may have some success in IT area, it cannot compare to Taiwan in high technology area, not to mention the Chinese military area.

    Comment by Richard — January 10, 2007 @ 2:53 pm

  23. According to my point of view the difference between these countries came from the system ” Democratic and Communism”.

    Let’s compare 50 years before while India got freedom, around 80% of people were illiterate and more than 50 % of peoples are below poverty line. In this situation choosing a country to be fully democratic is totally wrong. Because those peoples cant decide right thing for the country. As people failed to select good leaders and leaders failed to take good decisions. Thus the systems of India didn’t do so good like china in the past years.

    But more importantly we should notice the present situations where in India peoples now getting understand the importance to the country. No India started its speed with a stable and rigid base. So I believe India will perform better soon with keeping the importance of “democracy”.

    Comment by Vijay — January 19, 2007 @ 5:25 am

  24. India surely overtakes china; if you not believe go to the following fact shown in below link

    http://finance.yahoo.com/expert/article/futureinvest/2542

    Not as Indian, Not as Chinese, we all human beings should be happy if a democratic country leads to win. Democracy only gives respect to human rights….

    Comment by Suresh — January 20, 2007 @ 11:57 pm

  25. Hehe, the so-called democray and human rights have been picked up by Satan to fool you guys!

    Comment by lol — July 3, 2007 @ 11:50 am

  26. Chinese people are the most industrious people on the earth. They have greatest tradition and culture. However, the leader in China, Chinese Communist Party (CCP) ruin the ethics basis of Chinese people, which making the Chinese people all look forward to Money. Therefore, a lot of problems are created. As time goes by, these problems goes more and more critical. By the way, CCP is not from China, it’s from western world. It has a strong system to control the thinking of Chinese people and it use all kinds of media to brainwash the Chinese people, Falun Gong is a good example. If you touch the people practicing Falun Gong, you will find they are a group of very kind people, and if you go through their books, you can find they are just teaching people to be benevolent. I am really surprised that such a good belief was stigmatized as evil religion by CCP through a lot of lies. What puzzles me is that ordinary Chinese people can be so easily duped. In fact many facts about these lies can be easily found on the Internet, it looks like Chinese people is not willing to know the truth. Maybe that’s also caused by the lack of morality under the reign of CCP

    Comment by Tonnadolo — August 29, 2007 @ 8:12 am

  27. China can though take over in military power but it can’t take over india in economic term in long run. We have a most basic kind of economy with less of the FDI whereas china is running only on FDI’s and other investments, if they get stopped in the near future china would have no option but to suicide from starvation because they have made there needs so high that their domestic market alone can’t fulfill their needs they would have to turned upto other countries like Korea and Singapore to fulfill them.

    Comment by Jatin Singh Negi — June 24, 2009 @ 2:50 pm

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