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Advantage China

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Advantage China

Jug Suraiya
08 October 2013, 10:01 PM IST

It was an everyday morning in the housing colony and the sabziwalla was doing his rounds. A housewife selected a sizeable quantity of vegetables from him, and, without asking him what she owed him, handed over 20, which was clearly inadequate payment for her purchases. The sabziwalla accepted this token payment without protest.

The housewife's tenant — a young man from China — came out and also bought some vegetables, paying the right price for them. The housewife ordered the vendor to return the money and said to her tenant: "Just give him 10 or 20 rupees. I am the wife of a managing committee member and he dare not charge me the full price, or he'll be banned from coming into the colony. As my tenant, you have the same privilege." The tenant waited till landlady had gone into the house, then he paid the vegetable seller the full amount.

That small incident might help partly to explain a very big question: Why is it that China is so far ahead of India in almost all fields? The most commonly cited reason for China's lead over India is that China as a totalitarian state is made to march forward to the same drumbeat or face the consequences, whereas India enjoys a chalta-hai democracy, in which for every one step forward we take, we seem to go three steps sideways. Dictatorships tend to be, at least outwardly, single-minded and more disciplined; democracies, being diverse, are often divided as to their goals.

Fair enough. But there could be another, equally fundamental reason why India remains so far behind China. And that reason — illustrated by the anecdote about the wife of the managing committee member taking it as her right to shortchange the sabziwalla — is entrenched and everyday corruption.

All of us express outrage at the corruption of our politicians and bureaucrats. But one way or the other, all of us are implicated in either giving or taking graft, of one form or another. Bribery and corruption have become the lubricants of the wheels and deals of everyday living, from awarding a government contract, buying defence equipment to protect the country, selecting a sports team to represent the nation, or buying one's daily vegetables.

Of course, China also has its share of corruption, as shown by the recent much-publicised trial of Bo Xilai, an eminent political figure. But perhaps in China corruption hasn't become a routine reflex, performed almost automatically and without thinking, as it seems to have become in India.

It's like breathing. You don't have to think before you breathe; breathing happens naturally. In India bribery has become a fact of nature like breathing. This common air of corruption that we breathe infects us all, and affects our everyday relationships with others, from the babu we have to bribe to get our work done to the sabziwalla we shortchange through the misuse of authority.

All-pervasive corruption corrodes the unwritten contract, the mutual trust on which society is based. By cheating you today, i ensure that you'll cheat me tomorrow, or whenever you have the chance. In the end everyone loses, because today's cheater is tomorrow's cheated, and vice versa.

Advantage China, disadvantage India.

Advantage China by Juggle-Bandhi : Jug Suraiya's blog-The Times Of India


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This is a blog that I come across recently. Please share your opinion.

Compared with Chinese Chen Guan (城管), Chen guan are at least under the name for public orders, but this landlady seems purely for self enrichment.

Another question is, why the sabziwalla (what is it? A street peddler?) has to sell here not somewhere else?
 
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I really like the Indian attitude.

Self-criticizing is an attitude of a great nation. I believe India will became a better country in the near future. :toast_sign:

Btw, China is not that good thou. There are still a lot of things need to be done...I mean a lot!
 
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Critics of India by Indians are for the betterment of the Nation. Corruption is everywhere, every nation. Issue arises is does the rule of law act against it. In India it seems rule of law on corruption is take for a ride.
 
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The article makes little sense. Corruption in a nation should be judged based on loss of revenues to the Govt or illicit outflows rather than anecdotes.

Top 10 countries with the highest measured cumulative illicit financial outflows between 2000 and 2008 were:

China: $2.18 trillion
Russia: $427 billion
Mexico: $416 billon
Saudi Arabia: $302 billion
Malaysia: $291 billion
United Arab Emirates: $276 billion
Kuwait: $242 billion
Venezuela: $157 billion
Qatar: $138 billion
Nigeria: $130 billion

Global Financial Integrity - Reports - Illicit Financial Flows from Developing Countries: 2000-2009 - Overview

For India it was $462 billion from 1948-2008

Global Financial Integrity - Reports - The Drivers and Dynamics of Illicit Financial Flows from India: 1948-2008 - Overview

India's underground economy is closely tied to illicit financial outflows. The total present value of India's illicit assets held abroad ($462 billion) accounts for approximately 72 percent of India's underground economy.


I would say hardend laws and proper implementation of them would be the key to reduce loss due to corruption.
 
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The article makes little sense. Corruption in a nation should be judged based on loss of revenues to the Govt or illicit outflows rather than anecdotes.



Global Financial Integrity - Reports - Illicit Financial Flows from Developing Countries: 2000-2009 - Overview

For India it was $462 billion from 1948-2008

Global Financial Integrity - Reports - The Drivers and Dynamics of Illicit Financial Flows from India: 1948-2008 - Overview




I would say hardend laws and proper implementation of them would be the key to reduce loss due to corruption.


I have some doubts about the figure from GFI regarding China, as RMB is not freely exchanged on the market, and China has one of the most strict control over capital outflows. Unless all those $ 2.18 trillion were smuggled outside of China without the government notice, which raise another question of where does this USD 2.18 trillion come from in the first place inside of China.
 
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I have some doubts about the figure from GFI regarding China, as RMB is not freely exchanged on the market, and China has one of the most strict control over capital outflows. Unless all those $ 2.18 trillion were smuggled outside of China without the government notice, which raise another question of where does this USD 2.18 trillion come from in the first place inside of China.

The rest of of the world too has doubts about your figures.

BBC News - The trouble with Chinese data
 
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I have some doubts about the figure from GFI regarding China, as RMB is not freely exchanged on the market, and China has one of the most strict control over capital outflows. Unless all those $ 2.18 trillion were smuggled outside of China without the government notice, which raise another question of where does this USD 2.18 trillion come from in the first place inside of China.

I have not gone in depth in the report. However considering China is involved with massive infrastructure project involving billions of dollar, even 1% of these deals is huge money. from 2000-2008, China has lost on an average over $200 billion and seems reasonable when it grew from $1.1 trillion economy to $ 4.5 trillion economy.
 
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The rest of of the world too has doubts about your figures.

BBC News - The trouble with Chinese data

Do you even bother read the article before you post it here to troll? The article is saying exactly the opposite of what you are implying.

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In June, China's customs administration cracked down on false trade invoices that disguised money flows designed to get around capital controls.

It ended up reducing China's trade figures.

Now, 28 companies in Luliang county in Yunnan province have reported industrial output that was more than double what their actual production was last year.

According to Xinhua, the companies defended themselves and said that local officials had induced them to do so in exchange for loans from state-owned banks.

The trouble with Chinese data is that government officials have been set targets in the successive Five-Year Plans that govern the country's economic planning. And no official would want to miss their target.

So, it probably creates an upward bias in their reporting and overstates Chinese growth.

Growing discrepancy

This is one of the reasons why the National Bureau of Statistics gathers their own statistics from firms and households directly to compute economic growth, so as to not rely on local governments.

The gap between the national figure and the combined local figures was 2.7 trillion yuan ($440bn; £280bn) in 2009 and rose to 5.8 trillion yuan in 2012.

That would have added 11% to China's total gross domestic product (GDP) last year.

In the first half of this year, the output of all of the provinces was 3.2 trillion yuan higher than the national figure. Computing aggregate Chinese GDP based on provincial data would have put annual GDP expansion at well over 10% in the past three decades.

It's not to say that they can overcome all of the biases of course.

But, by directly measuring what firms produce and households earn, they also try and address another source of mis-measurement common in developing countries.

There may be income that isn't measured if a farmer sells some produce by the side of the road, or urban peddlers selling goods on the street.

The so-called grey economy can be fairly large as seen in countries around the world, adding more than 50% to GDP in places like the Middle East and Africa. For a country as vast as China, it is likewise a source of downward bias in its statistics.


Clampdown

In any case, these are hardly new complaints about the accuracy of Chinese statistics.

Before becoming premier, Li Keqiang had questioned the reliability of Chinese GDP. He was reported to have said to look instead at three direct indicators of economic activity: cargo volume on railways, electricity consumption, and bank loans.

The recent wave of action fits with the overall push by the new Chinese leaders to crack down on fraud and corruption. For Premier Li, it is an attempt to increase confidence in the Chinese economy.

Zheng Yuesheng, the spokesman for the customs agency, had said false trade declarations exist but were "definitely not mainstream".

We may soon find out.

Again in this article its states that it is the local government's data are inflated, but the central government does not trust local government's data but it collect its own data through NBS. Also its method is not any different from HSBC, IMF and world bank.
 
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Do you even bother read the article before you post it here to troll? The article is saying exactly the opposite of what you are implying.



Again in this article its states that it is the local government's data are inflated, but the central government does not trust local government's data but it collect its own data through NBS. Also its method is not any different from HSBC, IMF and world bank.

I have not gone in depth in the report. However considering China is involved with massive infrastructure project involving billions of dollar, even 1% of these deals is huge money. from 2000-2008, China has lost on an average over $200 billion and seems reasonable when it grew from $1.1 trillion economy to $ 4.5 trillion economy.
My dear friend this might explain some of the money involved, but not the majority of it. Let's say it is 10% of those deals, with an average annual $200mil+ those deals are rated at 2 trillion USD annually.

However as the article Jaytal provided, the discrepancy can be explained if the data GFI were using were actually from those inflated figure from local government and used to compare with the actually number NBS or any other financial institutes as IMF, GS or World Bank were using.
 
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In china, corruption drives the growth of our economy. See the restaurants and hotels shut down when the CCP forbid the 公款消费。
 
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I really like the Indian attitude.

Self-criticizing is an attitude of a great nation. I believe India will became a better country in the near future. :toast_sign:

Btw, China is not that good thou. There are still a lot of things need to be done...I mean a lot!
 
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