PRESENTATION BY-RISHIKESH RAJ

POPULATION

Current population(2015) of china-1.39 billion and india-1.27 billion aprox.

ECONOMYINDIA

Market based system

Foreign trade and foreign investment as integral part of Indian economy

Fastest growing economy

World’s second largest labor force

CHINA Centrally planned Economy

Private businesses and capitalism were suppressed

Privatization of Farmland

Promotion of foreign investment

Flourishing small scale entrepreneurs

What are India & China famous for today ?

Call centers &

computer

Engineers(Er.)

Low-priced consumer goods(chines mobile,eg-xiomi)

AGRICULTUREINDIA

India is an agricultural country. Growth of service sector is pushing

down the contribution of agriculture.

Contributing 13.2% of the GDP. Largely depends on monsoon. Provides employment to two-thirds

of the total population. 15% of export earnings Rural women play a vital role, 50%

of rural labor force. Yields per hectare of crops in India

are very low

CHINA Agriculture accounted for 10.6 % of

the GDP 33o million- over 45% of labor force

still makes living from farming. Farming methods have been

improved in China. China produces wheat, rice,

potatoes, peanuts, millet, cotton. Only 15 percent of the total land

available in China can be cultivated. more than 75 percent of the total

cultivated land is used for producing food crops.

COMPARISON

Comparing India and China’s Growth Stories

Indicators India ChinaPolitical System

Multi-party Democracy

One-party authoritarian rule

Speed of Growth

Economic reforms started in 1991. Average 6% growth rate in past two decades.

Economic reforms started in 1978. Average 9.5% growth rate in past two decades.

Areas of Specialization

Rising power in software, design, services, and precision industry.

Dominant in mass manufacturing, electronics and heavy industrial plants

Comparing India and China’s Growth Stories

Indicators India ChinaGini index (standard measure of inequality)

36.8

47.0 (up 10 points from 15

yrs ago)

Foreign Direct Investment

6.8% (up from 0.3% in 2004)

17.8%

Future Areas of growth

R&D, bio-technology, high-value IT enabled services (legal, medical, engineering architecture), manufacturing, agro-based industry

IT business, services and continued manufacturing

Why India lags behind china in FDI attraction?

The main reasons are:-

Political structureInfrastructure gapMonetary and fiscal policiesProductivity BureaucracyAvailability of capitalTransport costsCorruption

Why china is best FDI destination?

The main reasons are:-

Rapid economic growth since reform period Infrastructure availabilityAbundance of labor and its low costRapid expansion of china's domestic market Role of overseas ChineseIncreased integration with the worldLabor lawsPolitical system and stability

HOW CAN INDIA ATTRACT MORE FDI ?

Political restructuring Promote agro based export industries Remove corruption Increase infrastructure investment Accelerate privatization efforts Improve educational fitness Remove FDI hurdles Provide monetary and fiscal benefits Reduce delay in Approving FDI projects