China or india - arise roby

Presented by:
ARISE ROBY
ARISE TRAINING & RESEARCH CENTER

Market based system
Foreign trade and foreign investment as integral
part if Indian economy
Fastest growing economy
World’s second largest labor force

Centrally planned Economy
Private businesses and capitalism were
suppressed
Privatization of Farmland
Promotion of foreign investment
Flourishing small scale entrepreneurs

50 yrs ago, India and China were among the poorest and economically
most isolated countries in the world.
How did China and India emerge as
economic giants?

GDP – real growth rate:
9.8% (2008) country comparison to the world:
13% (2007)
11.6% (2006)
GDP-Per capita (PPP-Purchasing power parity):
$6,000 (2008)country comparison to the world:
$5,500 (2007)
$4,900 (2006)
note: data are in 2008 US dollars
GDP – composition by sector:
agriculture: 10.6%
industry: 49.2%
services: 40.2% (2008)
China – Economic Fact Sheet

GDP- real growth rate:
6.6% (2008)
9% (2007)
9.6% (2006)
GDP – per capita (PPP – Purchasing power parity)
$2,800 (2008)
$2,700 (2007)
$2,500 (2006)
note: data are in 2008 US dollars
GDP – Composition by sector:
agriculture: 17.2%
industry: 29.1%
services: 53.7% (2008)

Indicators India China
Political 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

Indicators India China
Gini 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

Agriculture
Sector

 India is an agricultural country.
 Growth of service sector is pushing down the
contribution of agriculture.
 Contributing 17.2% 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

 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.

INDUSTRIAL
SECTOR

 Manufacturing contributes around 15% of GDP of the
country.
 According to CSO data quartely estimate of GDP for
manufacturing stood at 38.1 billion US $.
 According to the data the cumulative growth in
manufacturing index for April-June has been 3.2%.
 In the manufacturing sector the value of new project
announced in 2nd half of 2008-09 stood at 13.2 billion
US $.

 India rank’s among top 12 producers of manufacturing
value added products.
 In Textile it ranks 4th after China, US & Italy.
 In Electrical machinery & apparatus India ranks 5th.
 India holds 6th position in basic metals category.
 7th in Chemicals & chemicals products, 10th in leather
& leather products, 12th in machinery & equipment &
motor vehicals.

 According to CSO the industrial output clocked an annual
growth rate of 6.8% in July 2009.
 There are many Companies who wants to make India as their
manufacturing hub, they are
LG wants to make India its global manufacturing hub for its
mobile handsets.
Hyundai has make India the manufacturing & exporting hub for
its small cars. Their i10 is being manufactured only in India &
exported to the world.

 Luxury brands like Louis Vuitton are looking at India
as a manufacturing base for their products.
 Skoda Auto plans to make India its regional
manufacturing hub. Aircraft manufacturing Airbus is
considering India as one of the centres for design &
development of its long haul A350 plane.
 Samsung plans to invest 100 million US $ in its
manufacturing plant near Chennai & make it its global
hub.

 Suzuki too is making India its manufacturing hub for its
small cars.
 According to Investment Commission of India the
manufacturing sector is estimated to have 180 billion US $
investment opportunity over next 5 years.
 Manufacturing sector is the largest employer which
employes 25.5 million people of the total workforce.
 Employment growth rate is 2.78%

 Chinese manufacturing sector accounts for 43% of
Chinese economy.
 Its economy growth in average of almost 8% every
year.
 Chinese manufacturing sector ranks 4th in the world
after US, Japan, & Germany.

 China’s fast growing domestic market worldwide
demand for Chinese goods & the cost advantage China
offers to manufacturers are fueling the growth of
manufacturing sector in China.
 Purchasing Manager’s Index (PMI) which measures
manufacturing activity nationwide.
 PMI index rose to 54 points in August up from 53.3 in
July.

 China has 50% share of worldwide camera market.
& 30% of Air conditioners .
 25% of Washing Machines & 20% of Refrigerators.
 China’s crude steel production rose by 28.25%.
 Investment in chemical industry grew by 35.9%.

SERVICE
SECTOR

Can be classified into 2 types:
Old
New
Old Services includes:
Petty Trading
Domestic Services
Catering and Hotel Services

New Services includes:
Communications
Business and legal practices
Culture, research and education.

INDIA v/s China
INDIA CHINA
54 per cent of GDP Below 41 per cent of GDP
Since 1978 to 2008 :
Average Annual Growth rate is 7.0% Average Annual Growth rate is 10.8%
Employment Opportunities :
Low High
Most advanced service sector :
Delhi with a GDP share of 77 per cent Beijing with a GDP share of 61 per cent
A net exporter of services A net importer of services

 According to a recent report from international
economic think tanks, India and China soon plans to
form a trade coalition in Asia and that is projected to
boost 65% of world trade by near 2020.Both the
countries India and China are determined to achieve
that and create a huge impact on world economic
bodies.

THANK
YOU

China or india - arise roby

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