In the next decade China will loose its military and economic edge

[Indian Patriot]

India has not yet realized its potential there is lot of gap to cover. China has growth rates for more than 30 years and India too will have the growth rates more decades than China.

It is laughable for a country like India to have GDP of 2 Trillion. One reason is the country was looted by invaders starting from 12 th century A.D.

India's growth rates are fueled by MNCs not Indian companies. India can sustain a growth rate of 8 percent only in Indian domestic companies are willing to invest the hundreds of billion dollars in India like the MNCs do. As labor costs increase the MNCs will look to other countries.

Indian industries growth matter. But these industries are not allowed to grow by the marxist retards and the leftists in India who hate the rich. India will have to take hard decisions. Cut down on subsidies, invest in industrial infrastructure and sell PSUs. Any Indian government has the guts to do that? Economic reforms are frowned upon in India. Everybody wants freebies.

IF Indian companies can replace MNCs then yes, India can sustain 7.5 percent growth for 20 years.

 

[atatwolf]

China cann't claim that we would grow the fastest in the world forever!

But this thread is meaningless because it's all about wishful thinking of an anti-Chinese turk. Chinese development has broken hearts of many China haters and we'll still walk along the way... We don't like Turkish bath anyways...

Very constructive criticism but maybe you can address the arguments of the article that you disagree with so we can understand your superior thoughts.

 

[Srinivas]

India's growth rates are fueled by MNCs not Indian companies. India can sustain a growth rate of 8 percent only in Indian domestic companies are willing to invest the hundreds of billion dollars in India like the MNCs do. As labor costs increase the MNCs will look to other countries.

Indian industries growth matter. But these industries are not allowed to grow by the marxist retards and the leftists in India who hate the rich. India will have to take hard decisions. Cut down on subsidies, invest in industrial infrastructure and sell PSUs. Any Indian government has the guts to do that? Economic reforms are frowned upon in India. Everybody wants freebies.

IF Indian companies can replace MNCs then yes, India can sustain 7.5 percent growth for 20 years.

There are many sectors which need to catch up and potential to grow like Agriculture, food processing, fisheries, tourism, infrastructure, horticulture etc...etc.. MNC's are catalysts in this regard.
Each and every sector of give right push will grow more than 8 % and since there is lot of scope and potential to grow, the growth will last many decades.

 

[SrNair]

@atatwolf .I partly agree with you.
You are right .Increasing expenses would lose the Chinese attractiveness as a manufacturing.
But that wont cause any reduction in combined power of China.
China already has 10 trilliin $ economy.And a 5% -6% would be enough for them at these case.Being an autocratic state they wont face any issue in military spending.They will also pursue infinite ways to retain their manufacturing capacity.

 

[Rana Thakur]

China is becoming to expensive to manufature in. You might not now but Chinese average age is almost 40 years old per head. There are much cheaper countries to manufacture in. If you like it or not. This will happen.

And you think that why? Because Fu@k Economics.
My dear. Labour cost is not the only thing that decides establishment of any industry.
1)Proximity to market
2)Availability of resources
3)Technical capabilities
4)Availability of Land
5)Availability of Labor
6)Availability of Capitol
7)Investment friendly environment
8)Ease of business ( lesser red tapism )
9)Transportation facilities
10)Required infrastructure

These are some things i was taught in economics class in high school, are required for establishment of any Industry.
Cost of resources is primary, Cost of labor & labor efficiency is secondary.

 

[Indian Patriot]

There are many sectors which need to catch up and potential to grow like Agriculture, food processing, fisheries, tourism, infrastructure, horticulture etc...etc.. MNC's are catalysts in this regard.
Each and every sector of give right push will grow more than 8 % and since there is lot of scope and potential to grow, the growth will last many decades.

8% growth cannot be sustained for "many decades". Don't talk like a jingoist, consult any economist and he will answer how naive you are.

 

[Rana Thakur]

8% growth cannot be sustained for "many decades". Don't talk like a jingoist, consult any economist and he will answer how naive you are.

That's not jingoism. That is hope.

 

[Indian Patriot]

That's not jingoism. That is hope.

I understand hope. However hope and reality are different things.

 

[Srinivas]

8% growth cannot be sustained for "many decades". Don't talk like a jingoist, consult any economist and he will answer how naive you are.

china already did that , so will India if not more !

 

[Shotgunner51]

I think the OP has over-simplified manufacturing as if labor-cost is the only factor. The case maybe true if apply only on a few low-end labor-intensive manufacturing e.g. garment, clothing, but it would be very different in most high value manufacturing.

Take a look at steel industry, the backbone for all manufacturing, China produce 48.5% of world's cold steel in 2013, followed by EU, Japan, and US. Note, these are not low-wage countries.

Then look at ship building, a typical capital intensive industry. In 2012, China produced 45% of world's total, followed by Korea, Japan and EU. Same here, no low-wage countries.

Auto industry, similar pattern:

We see similar patterns in most high-value manufacturing industries i.e. dominated by high-wage countries e.g. robotics, medical equipments, electronics, hi-tech equipments, heavy electrics, optical equipments, computers, precision tools, etc.

High value added manufacturing is very demanding on skilled/highly-educated labor, steady utilities, modern infrastructure and very long and sophisticated supply chain. In these respects, the 16 countries proclaimed by OP to succeed China all have a very long way to go.

 

[dray]

I will just point out two things.

and 60% of today's China's younger generation (from 1990- 1996) have University degree or college degree, you think any country with bunch of illterate population can take jobs?

Didn't China had too many illiterate people and poor infrastructure when it was opening up, China still took away the manufacturing jobs then because they were cheap, so why can't others?

I think poor country like Turkey can have our cheap jobs, we do't need it anyway

What China's poor and not-so-educated people will do then, they are not a small number in absolute terms?

 

[Indian Patriot]

china already did that , so will India if not more !

China DID NOT sustain its growth for many decades. There are many complicated measures involved like international debt, manipulation of exchange rates and last but not the least the issue of slave labor. The Chinese don't have laborers, they have slaves working in their manufacturing hubs. A simple Google search will tell you that Chinese infrastructure is facing issues, MAJOR issues. They are staring at a real risk of their infra boom going bust.

Small countries with small GDP have high growth rates. Think of it in simple terms. You have 100 rupees in your pocket, how long will it take you to convert it into 300 rupees? And if you have 1 crore how long will it take you to convert it into 3 crores?

When a 100 billion dollar economy grows, say at a rate of 10%, it means the GDP next quarter/year is 110 billion; next fiscal calendar it is 121 billion dollars etc. In layman terms it is growing at 10-12 billion dollars per annum.

Now lets talk about a 1 trillion dollar economy. If it grows at a rate of 10% it will be growing like 100-120 billion and so forth every subsequent year. Increasing your economy by 100-150 billion dollars, which will eventually sky-rocket to more than 500 billion dollars, per year is NOT possible for long periods.

There is a limit to growth. USA has a 14 trillion dollar economy. With its massive resources and industrial muscle why can't they achieve 10% growth, which would be 1 trillion dollar increase, per year?

 

[IsaacNewton]

How can you move from cheap manifacturing economy to service economy when majority of China are primitive uneducated peasants? To make such a transition you need multiple decades. The economic slowdown of China is just on the corner. Probably this will lead to a big economic crises with Beijing loosing control of many poor provinces. Income inequality is too great. 90% of the Chinese who are peasants won't bare this inequality and fascism from Beijing.

Your view of China is completely twisted by your own bias for Ottoman#2 Pan-Turkism wet dream.

"Primitive uneducated peasants"? Just shows your own racism.
China has one of the most educated population among developing countries in the world. Its education center are actually far superior to the Turkish counterpart. Its literacy rate is actually higher than that of Turkey.

Aside from that, China's GDP per capita is 7600, which is about average for the world, not third world status. China's service sector is huge, and consumption based growth is steadily increasing.

Turkey's per capita GDP is 11000, but Turkey has been in western camp since 1922, while China only recently opened up in 1980. With so many decades of advantage, it is kind of surprising that Turkey is only slightly better than China right now.

Fascism from Beijing? China is a one party state, but I won't describe it as Fascism, there is actually plenty of economic and personal freedom in China. In terms of human rights abuse, China is probably ahead of Turkey - keep in mind Turkey has been begging EU to let them in since forever, but EU thinks they are unqualified.

If anything, that article from stratfor (which has been historically terrible at analyzing anything) describes Turkey more than China. Turkey's economy is in a much more fragile state than China's with its declining growth rate (2% in 2014 vs 4% in 2013), collapsing currency (dollar trading 1-2.5 Lira while a year ago it was 1-2.0 Lira), minority population unrest, ect.

 

[atatwolf]

Seems like some people are angry at me for just posting an article.

Couple of points:

-no need to compare one country to another. Especially when the scales are not the same. It is just stupid and it shows that you don't know anything about economics.

-It is just an analysis. If you don't disagree with it. Point out which part you disagree with and make a counter-argument. No need to act childish and do ad-hominem attacks.

-posting a list of successful companies of the country, doesn't say anything about the economy of the country as a whole.

 

[master_13]

China DID NOT sustain its growth for many decades. There are many complicated measures involved like international debt, manipulation of exchange rates and last but not the least the issue of slave labor. The Chinese don't have laborers, they have slaves working in their manufacturing hubs. A simple Google search will tell you that Chinese infrastructure is facing issues, MAJOR issues. They are staring at a real risk of their infra boom going bust.

Not sure where you get that slave labor data, but India has exponentially more serious issues with slaves than China. Global Slavery Index ranks India as 5th worst in slavery index, and China stands at top of the tier at 109. Data clearly indicates Indian's slave labors vastly outnumber that of China's, 14 million vs. 3 million

Global Slavery Index - Wikipedia, the free encyclopedia
http://d3mj66ag90b5fy.cloudfront.ne...11/Global_Slavery_Index_2014_final_lowres.pdf

It's surprising even with number of indian slave labors 5 times that of china, Indian economy still lags far behind China's.

It is a miracle that India is growing at all. Under UPA Indian growth had fallen as low as 4 percent. Inflation is on the rise in India which in turn will increase cost including labor cost. Unless India pays its workers very low wages like China does then the growth rate will not last long..

India already pays vastly lower wage than China, chinese wage is already at least 4 times higher than indian, not "unless" or "if", this is fact.