Why is China so ahead of India even when both started from same league?
Lance Chambers, Travelled extensively and see how politics works
India has a lot of problems. Fractured go nment with every party trying to bribe people to vote for them so we see thing like reservation going crazy — everyone wants to give reservation now to every different caste. This is impossible when there are over 30,000 castes but still some try. You have police that are incompetent and very corrupt like many politicians. After how many years still cannot solve Rafele issue. Some of Indias member of the highest scientific body in the country has two members who believe that the ancient gods were made from cloning and also the they had guided missiles — how can people like this be member of most important science group?
This is because China is ruled and governed by the Chinese in what they consider to be China’s interests in accordance with Chinese policies and laws.
India, however, is ruled in accordance with British interests in accordance with British thinking, policies and laws by British made PANGOLIN* stooges to earn the applause of aliens..
Bharat Nadhani, former Ex Mg Director
It is for faulty policy of Nehruji,
India was blessed by the Britons with :
1.Large Cotton & Jute Industries,
3.Ship & aircraft Industries
4.Pharma and Bulk Drugs etc - in comparison to the then world.
And they left the US$ at Rs 1.30 only.
They depreciated our currency from time to time , to cover of global competitiveness - by devauating our currency , it reached at Rs 68.50 in Chidembaeram regime.
Nehru neglected our development and opened the gate of import to China ( once they were Fakir ).
That China attacked India in 1962 and bullied us till 2014.
Trade deficit with China rose only in UPA regime:
Now we coming out of these, and India is now exporter of Mobile Phone, however components are being imported. Apple Phones are assembled in India.
The Afgan based Giasuddin Gazi derived Nehru Family always stood along the Chinese.
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The economic history and organization - structure and system at the commencement of economic journey of the two countries is very different. Still China has done well on many scores which, had we followed, might have also brought us in same league. They have level headed approach and responsible leadership
Some well established economic think tanks, including Wall Street Journal, advise caution on taking the data offered by china at its face value. It is believed to overstates its figures by nearly 2-3% and quality of their data is not dependable. There are no means to cross check the authenticity.
Notwithstanding this, their massive economic strength gained by consistent economic growth over 10% in three decades till 2015 cannot be wished away. Detailed analysis on all these aspects will not be feasible in this forum. Economic history books can be consulted by interested persons. Here I will indicate their specialties/strengths/focus which helped them in giving much better performance – in the face of such a large population base.
- Centralized control on economic resources enabled them to mobilize whatever surplus was available from any source and utilize a large proportion of economic output on investment. For instance in early 50s they simply took 45% of land from land owners and distributed to farm families. In 78/79 when the economy really shot up, their investment was 25% of GDP (in US it was 16%).
- Substantial natural resources – they are self sufficient in all energy forms – coal/petroleum etc. which is eating away majority of India’s forex. Every $ increase gives us sleepless nights.
- Massive expenditure on R&D and education – as a result their nation has shifted from exporter of items like agriculture goods, cloths and footwear to Computers, pharma products and automobiles.
- They didn’t shy away from foreign trade. They are the largest exporter of goods and second largest Importer of goods. They import 64% of manufacturing goods and 21% of mining and fuel products but export 94% of manufacturing goods…implying massive value additions and productive utilization of labour and manufacturing facilities. India was never that focused.
- Their decision making is nimble footed. Over the plans, they have moved between two principle policies – promoting economic growth and reduction of inequality with lightening speed. They see a problem and immediately take action to alter the system. Over the plans the emphasis have shifted from Agriculture to Industry, light to heavy industry to correct imbalance among sectors in relative growths.
- When they see something is not working, they change it. After first 2/3 plans they gave up Russian model of growth which was not giving results. In 80s they freed agriculture from central planning. In 90s restructured industrial sector, invited foreign investors, liberalized banking and started real capital market.
- They know how to deal with surplus labour. Farm labour and low skill industrial labour, which got surplus due to lack of opportunities on farms and development of automation was absorbed in small scale, low skill units in rural areas to make agriculture machinery and components for Urban Industries. In the very early stages they invested heavily in developing infrastructure for agriculture, building irrigation and water works and power which utilized surplus labour force.
- They have exploited economies of scale at every level. By converting/merging small units into cooperative and to communes, they brought efficiencies and increased production and yielded over 4% growth, on average, in agriculture through most of the period.
- They have also exploited comparative advantage across regions by massive development of transport and communication, very early on, in late 1940s, which increased flow of labour, investment and technology across regions.
Rajeev Bhatnagar, History enthusiast.
There are several reasons for China being ahead of us. You will not find them in textbooks, and reading them will be painful, but here are some important ones:
(i) China had early start:
China began "liberalization" of its economy about 13 years before us.
(ii) Voluntary choice vs. Forced on a sick economy:
China began liberalization by choosing that path - it was voluntary & deliberate choice. India did not opt for liberalization but was forced into it by IMF & Work bank in 1991, when we had almost nil foreign exchange to pay for imports like oil. Thus we waited for our economy to become extremely sick before starting.
So our starting point was a sick economy and politically half-hearted effort at that.
(iv) China's Labour is has higher productivity:
Chinese labour has higher productivity compared to Indian.
China is ahead of India(economically) basically because of few reasons mentioned below in no order of priority.
2.They adapted reforms earlier
3.They controlled population to their benefit - this is debatable
4.They created infrastructure
6.They don’t care for what others do they care for only what they have to do
8.They value their culture a lot and don’t sit silent when others attack their culture
Umesh Kumar Rai, BE from Army Institute of Technology (2007)
Until Late 70s, China and India were on the same league. poverty was similar in both countries. But post early 80s, China started economic reforms which we didn’t. And that fuled Chinese economic growth towards double digit growth for the next 3 decades. Its not that India didn’t grow during this time. But the difference in the growth rate of both countries was dramaticaly different because of which China is so ahead today compared to India.
Pradip Gangopadhyay, Seeker of Truth
China has raced ahead of India since 1980 because of adoption of an export led model copied from Japan, Singapore and Taiwan. India’s domestic consumption led model is slow but more sustainable. India should now grow faster than China for a very long time.