India is losing the race: NY Times

[djsjs]

the biggest difference between china and india econemy is neither GDP amount nor GDP growth.it is the structure of GDP.china has a big manufacturing while india has a big service industry.
The proportion of the three major industries:
china---10%---45%---45%---（2012）
india----20%---20%---60%---（2006）
so we can clearly see they are different econemy models
india should enlarge its manufacture industry and china has a big growth room of service industry.

 

[Wombat]

Most fast developing economies have a weak point called the Lewis Turning Point

I found this article by the economist ...

China approaching the turning point
Jan 31st 2013, 16:50 by A.C.S. | NEW YORK

CHEAP Chinese labour makes the world go around. It supplies developed markets with cheap goods which, to some extent, make up for stagnating wages. It also keeps the Chinese economic model humming by providing the foundation for growth. But how long can it last? IMF economists Mitali Das and Papa N’Diaye, in a new working paper, reckon only about another decade.

When an economy first becomes industrialised it grows very fast by importing foreign technology and employing capital and plentiful, cheap, unskilled labour from the farm. But after a while the extra agricultural labour is put to work and wages start to rise. This makes firms less profitable and they have to come up with their own technology to keep growing. This shift is known as the Lewis Turning Point, named after Nobel-Prize winner Sir Arthur Lewis. According to the IMF economists China is not there, yet. But the glut of labour peaked in 2010 and, as the population ages, it’s all down-hill from here. They estimated that if things stay as they are, China will reach the Lewis Turning Point between 2020 and 2025.

Attached graph for another website :- http://www.kkr.com/images/insights/13-images/charts-13.png

Of course things might change. If China relaxed its one child policy and everyone there suddenly had lots of babies (they assume a very high fertility rate) the Lewis Turning point might be delayed by a few years (though not much because it takes time for babies to grow into workers and have more babies). Alternatively if there’s financial sector reform, interest rates will rise. In that case Chinese worker/savers will feel richer and may not want to work as much; this would speed up the turning point.

This story is reminiscent of “the Asian economic miracle”, the once impressive growth of Hong Kong, Singapore, Taiwan and South Korea. Paul Krugman claimed their growth was not such a miracle. It was merely the mobilisation of resources: taking foreign technology and using cheap labour and capital. Eventually you run out of cheap labour, reach a point of diminishing returns to adding more capital, and growth slows. Though living standards are much higher than they were before, these countries no longer grow as fast.

Perhaps China will experience a similar fate. When that happens the world may look different. Consumer goods will cost more, though some low-skill jobs may come back to the west. China can't sustain its current rate of growth; the question is whether growth will slow before incomes have attained rich-world levels or while many have yet to benefit from the fruits of development. The Chinese model seems to rely on continuous improvement in living standards; the fear is if that stops there could be social unrest. Chinese growth has often confounded observers. If China becomes a leader in innovation growth might continue. It will take such a leap to overcome demographic headwinds.

 

[INDIC]

the biggest difference between china and india econemy is neither GDP amount nor GDP growth.it is the structure of GDP.china has a big manufacturing while india has a big service industry.
The proportion of the three major industries:
china---10%---45%---45%---（2012）
india----20%---20%---60%---（2006）
so we can clearly see they are different econemy models
india should enlarge its manufacture industry and china has a big growth room of service industry.

We are shifting towards manufacturing based economy in a decade time but unlike China it won't be export oriented.

 

[scarcry]

In 2008 we were nowhere in 2012 WORLD BANK is giving such prediction not some cheap stake thinktank. BTW, 8% growth in china is true with 6% here, and so it does match up to predictions, like a bubble you expend till it hits you, same with China and later India.

BTW amusing to see Pakistanis commenting. I assume pakistan has 11% growth rate to comment on these matters?

 

[Srinivas]

Not all the GDP Data given by Chinese CCP is believable.

 

[deepak.chauhan2312]

India was in a race with China?

Like saying Somalia trying to compete with USA



According to some, India is behind China 50 years on all factors

India is behind China for sure but as a Pakistani u r showing your jealousy. Pakistan is at least 30 years behind India so if we ssay in this way than you are living in ancient world omg i feel pity for you.



China have bigger impact on world.....there is sure a big gap between India and China not of 50 years but i can say it is nearly impossible to cover for India but as i am Indian so i can't loose hope in India as it has done so much progress in last 20 years which world could never imagined ...i hope Indian Govt will make some good changes in Infrastructure and India should opt manufacturing Industry .

 

[Wombat]

Not all the GDP Data given by Chinese CCP is believable.

yes agree with you , they seem to come up with some unbelievable number's in record time too , but one need to start some where

their PMI ( purchase manager index) is down- border line contraction and the economy has slowed this year with numbers lowest in 14 yrs

 

[cirr]

Is there a race going on？

How come that China is not aware of such a race？

 

[Icewolf]

India is behind China for sure but as a Pakistani u r showing your jealousy. Pakistan is at least 30 years behind India so if we ssay in this way than you are living in ancient world omg i feel pity for you.

No, when seeing all factors of life in both India & Pakistan, Pakistan is atleast 20 years ahead of India on quality of life.

Per capita doesn't really matter with India because per capita is just GDP divided by population, and it's not a good measure in India where 70% of the pop. earns below $2.00.

 

[SHAMK9]

Yeah the race never ends but the gap is widening contrary to west's perceptions as mentioned in article.The indian dreams of becoming regional bully have shattered..

This cheerleader attitude won't get us anywhere

 

[Icewolf]

Btw, I can be jealous about China, but definently not India... What's there to be jealous about India?

 

[turkish]

No, when seeing all factors of life in both India & Pakistan, Pakistan is atleast 20 years ahead of India on quality of life.

Per capita doesn't really matter with India because per capita is just GDP divided by population, and it's not a good measure in India where 70% of the pop. earns below $2.00.

Pakistan is 20% ahead ... Where did you get that data???

 

[Icewolf]

Pakistan is 20% ahead ... Where did you get that data???

UN 2012 INFO

 

[cirr]

Not all the GDP Data given by Chinese CCP is believable.

And Indian GDP data are creditable and believable？

Whom are you fooling？

Even your export and import dada are doctored。Need me to give you the link？

The truth is that China has been under-reporting its GDP for years and for obvious reasons. The country needs to drastically improve its tax collection system and get rid of the huge 'underground economy" by which hundreds of millions of migrant workers live in big urban areas.

Otherwise the official figures will never be able to reflect the true size of the economy.

It is hoped that the on-going 3rd economic census will do the trick.

Just don't be surprised when China upgrades its GDP as a result.

 

[turkish]

UN 2012 INFO

Here is one more info for you, by the way its from Pak...In 65 years, India excels Pakistan in many fields - thenews.com.pk