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Which will grow faster: India or Indonesia? (The Economist)

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Which will grow faster: India or Indonesia?​


Both countries are pioneering new ways to get rich in a troubled world

20230401_IRD001.jpg


Mar 29th 2023

If You are looking for growth opportunities among the world’s 20 biggest economies, two stand out: India and Indonesia. The Asian giants, with a combined population of 1.7bn, are forecast by the imf to be the two fastest-growing top-20 economies in 2023, and over the next five years. Both are pioneering strategies for getting richer in an era of de-globalisation, fraught geopolitics, automation and energy shifts, even as they seek a political formula that wins elections and avoids social unrest. Whether they succeed matters not just for their people and the investors betting many billions of dollars on them. It will also set an example for scores of other countries searching for new and reliable ways to develop in the 2020s and beyond.

For decades developing countries have followed a trusted formula for growing wealthier. Move workers from fields to more productive manufacturing jobs in cities, have them make goods for export, and watch the rapid formalisation of the economy. It worked in South Korea and Taiwan. In China it saw 800m people escape poverty. But today this scheme no longer works well. Many countries are rowdy democracies, not authoritarian states (as South Korea and Taiwan were when they industrialised). Protectionism challenges export-led growth. Factories use more robots.

At first glance, India and Indonesia have much in common. Both are led by charismatic leaders first elected in 2014, and both will hold elections next year. Narendra Modi, India’s prime minister, and Joko Widodo (widely known as Jokowi), Indonesia’s president, cut their teeth in local politics and have a reputation for getting things done. They run vast (India has 1.4bn people and Indonesia 280m) and relatively young countries with myriad ethnicities and languages.

340858692_584164000144325_4917875964223157539_n.jpg


 
Economic Comparison Between 2 countries (IMF projection for whole 2023)

GDP (current price):

- India : $3.74 trillion
- Indonesia : $1.39 trillion

Percapita GDP (projected 2023)
- India : 2.6 thousand USD /capita
- Indonesia : 5.02 thousand USD /capita

Population
- India : 1.4 billion
- Indonesia : 273.5 millions

Budget Deficit:
- India : -8.87% GDP
- Indonesia : -2.55% GDP

Primary balance :
- India : -3.56% GDP
- Indonesia : -0.5% GDP

Public debts ratio (Government Debt/GDP) :
- India : 83% GDP
- Indonesia : 39.1% GDP



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Previous GDP growth (Last Financial Quarter (2022))
India : 4.4 %
Indonesia : 5.01 %


-------------------------------------------------------------------------


Sources:



 
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Economic Comparison Between 2 countries (IMF projection for whole 2023)

GDP (current price):

- India : $3.74 trillion
- Indonesia : $1.39 trillion

Percapita GDP (projected 2023)
- India : 2.6 thousand USD /capita
- Indonesia : 5.02 thousand USD /capita

Population
- India : 1.4 billion
- Indonesia : 273.5 millions

Budget Deficit:
- India : -8.87% GDP
- Indonesia : -2.55% GDP

Primary balance :
- India : -3.56% GDP
- Indonesia : -0.5% GDP

Public debts ratio (Government Debt/GDP) :
- India : 83% GDP
- Indonesia : 39.1% GDP



-------------------------------------------------------------------------

Previous GDP growth (Last Financial Quarter (2022))
India : 4.4 %
Indonesia : 5.01 %


-------------------------------------------------------------------------


Sources:



Indonesia has more room to borrow. You have to spend money to make money. Infrastructure projects get the best returns on investment.
 
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INEQUALITY (OECD report)

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Which will grow faster: India or Indonesia?​


Both countries are pioneering new ways to get rich in a troubled world

20230401_IRD001.jpg


Mar 29th 2023

If You are looking for growth opportunities among the world’s 20 biggest economies, two stand out: India and Indonesia. The Asian giants, with a combined population of 1.7bn, are forecast by the imf to be the two fastest-growing top-20 economies in 2023, and over the next five years. Both are pioneering strategies for getting richer in an era of de-globalisation, fraught geopolitics, automation and energy shifts, even as they seek a political formula that wins elections and avoids social unrest. Whether they succeed matters not just for their people and the investors betting many billions of dollars on them. It will also set an example for scores of other countries searching for new and reliable ways to develop in the 2020s and beyond.

For decades developing countries have followed a trusted formula for growing wealthier. Move workers from fields to more productive manufacturing jobs in cities, have them make goods for export, and watch the rapid formalisation of the economy. It worked in South Korea and Taiwan. In China it saw 800m people escape poverty. But today this scheme no longer works well. Many countries are rowdy democracies, not authoritarian states (as South Korea and Taiwan were when they industrialised). Protectionism challenges export-led growth. Factories use more robots.

At first glance, India and Indonesia have much in common. Both are led by charismatic leaders first elected in 2014, and both will hold elections next year. Narendra Modi, India’s prime minister, and Joko Widodo (widely known as Jokowi), Indonesia’s president, cut their teeth in local politics and have a reputation for getting things done. They run vast (India has 1.4bn people and Indonesia 280m) and relatively young countries with myriad ethnicities and languages.

340858692_584164000144325_4917875964223157539_n.jpg


Indonesia, hands down, no contest.

Our population is a big limiting factor for our growth rate vis a vie per capita income. No easy solutions around that problem.

Indonesia has fewer limiting factors such as your geography but by large you guys are on your way to comfortably solve them. On a bonus note, you guys are also located near international naval trade routes and are optimally placed to get a large piece of that pie.

No contest really.
 

Indonesia, hands down, no contest.

Our population is a big limiting factor for our growth rate vis a vie per capita income. No easy solutions around that problem.

Indonesia has fewer limiting factors such as your geography but by large you guys are on your way to comfortably solve them. On a bonus note, you guys are also located near international naval trade routes and are optimally placed to get a large piece of that pie.

No contest really.

We still need to wait and see, there will be Q1 2023 economic growth released in next month. Indonesia Statistic Biro will likely release the data early while Indian Statistic Biro usually release the real growth data in the end of the month.

From there, we can see latest economic growth trend of each country (Indonesia and India) that happen during current challenging economic period that has slashed many high economic growth countries performance. Vietnam GDP growth for example is only 3.3 % in Q1 2023. Vietnam has already released the data.


Every thing can possibly happen, we dont know for sure what will happen in the future. For my country, next Presidential Election will be crucial since we are going to have new President as Jokowi has already had his final term as President. Indonesian law limits Presidency period into just two term or 10 years.
 
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We still need to wait and see, there will be Q1 2023 economic growth released in next month. Indonesia Statistic Biro will likely release the data early while Indian Statistic Biro usually release the real growth data in the end of the month.

From there, we can see economic growth trend of each country (Indonesia and India) that happen during current challenging economic period that has slashed many high economic growth countries performance. Vietnam GDP growth for example is only 3.3 % in Q1 2023. Vietnam has already released the data.


Every thing can possibly happen, we dont know for sure what will happen in the future. For my country, next Presidential Election will be crucial since we are going to have new President as Jokowi has already had his final term as President. Indonesian law limits Presidency period into just two term or 10 years.
You're right, future remains uncertain and we cannot assume anything with absolute precision.

In such a case looking at it statistically or postulating logically might lessen the obfuscation. Indias population is a double edged sword that needs to be tempered with policies, growth and innovation to address our unique problems. So anticipate lots of problems, delays and hassles down that road.

Indonesia on the other hand sits right between a developed economy to the south and a burgeoning one to the north west. Majority of the international trade flows through seas and choke points around her. You're population is at the right spot to be big enough to be influential on the global stage and be developed to an advanced degree at a sustainable basis. Your ships are ideally placed to take advantage of logistics to all the nations in the area.

Unless your polity really screws it up, just simply staying economically stable for the next 50 years would see the Indonesian economy boom with a high degree of probability.
 

India's economy expected to grow by 5.9% this year​

 

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