Comparative Analysis: Economic Development of India and China Report

This report provides a comparative analysis of the economies of India and China, highlighting key differences in their development trajectories. It begins by noting the similar population and unemployment rates, as well as high GDP rates, but emphasizes that China's economy is significantly larger. The report traces the economic performance of both countries, pointing out that while India has made progress, China has outperformed. The analysis attributes this to differences in political systems, with India's democratic framework often leading to slower decision-making compared to China's authoritarian model. Infrastructure development, investment in education and healthcare, and urbanization rates are also discussed as factors influencing economic growth. The report concludes by suggesting that India needs to improve its infrastructure, health, education, and urbanization to foster future economic growth, while China's model has provided it with a competitive edge in the global market.

COMPARISON OF INDIA AND
CHINA

Comparison of India and China
India and China are the two countries whose population and unemployment rates are almost
alike. The current GDP rates of both these nations are counted among the highest in the entire
world. Still, the economy of China is comparatively many times larger than India. Until 1985
China and India had almost equal GDP of 293 US dollars per person (Friesen, 2019). After
1985 till today the economy of India has progressed a lot but China’s economy has actually
outperformed.
There are few aspects which has and may come in way of India’s future growth and
development. India is a democratic country and therefore it becomes really difficult to take
any decision without the consent of its citizens and opposite is the case in the country China
where Chinese Communist Party (CCP) rules the nation with few barriers.
For instance, India took sixteen years to pass 2016 tax reform bill. The project of damming
Yangtze river could not take place in India. On the contrary, China spent a decade to
construct the Three Gorges Dam which is the world’s largest hydropower project. This
decision removed thirteen cities, 1.2 million citizens, 1350 villages and 140 towns. No doubt,
this project involved heavy environmental and social cost but at the end it facilitated Chinese
with a clean energy source and created enormous job opportunity for them.
Therefore, for a rapid development an authoritarian political system comes an upper hand
over democratic political system. Still, India’s infrastructure development is really poor as a
result of democratic political system and China is developing on a fast pace in terms of
infrastructure. This difference in political system can affect the economic growth and
development of India.
China has always tried to develop its human resources and therefore it has invested heavily in
both education and healthcare. In case of India, both health and education has always been an
area to worry about (Kapoor, 2019). Human Development Index (HDI) report of 2015
classified China as “High Human Development” and India as “Medium Human
Development” (Naseem, 2017).
Another factor which has and may further slow down India’s economic growth is the low rate
of urbanisation. Back in 1969 the urbanisation rate of India was higher than China. From
1969, China’s rate of urbanisation went up drastically and today approximately 58% of
Chinese citizens lives in cities. These people have shifted from agricultural sector to service
sector. In case of India the rate of urbanisation is just around 37% which means maximum
population are still engaged in agricultural sector (Roberts, 2019).
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Comparison of India and China
From the above discussion it is clear that economy of India is far behind than China in terms
of economic growth because of democratic political system, mere focus on health and
education and low rate of urbanisation. It is important for the Indian economy to make an
effort to improve its infrastructure, health, education and urbanisation rate. Failing to do so
may hamper the future economic growth and development of India.
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Comparison of India and China
References
Fiesen, G. (2019). Politics, Productivity & Population: Why The Chinese Economy Flew
and India's Just Grew. Available at:
https://www.forbes.com/sites/garthfriesen/2019/03/21/politics-productivity-population-
why-the-chinese-economy-flew-and-indias-just-grew/#50644de42e7d (24 February,
2020).
Kapoor, A. (2019). Why India Can Learn from China’s 70 years of Growth. Available at:
https://economictimes.indiatimes.com/news/economy/indicators/what-india-can-learn-
from-chinas-70-years-of-economic-growth/articleshow/71463414.cms (24 February,
2020).
Naseem, S. (2017). Economies of Two Asian Giants India and China: A Comparative Study.
International Journal of Business and Social Science.8(9). 42-48.
http://www.ijbssnet.com/journals/Vol_8_No_9_September_2017/5.pdf
Roberts, M. (2019). China and India - why the economic difference?. Available at:
https://www.mercatornet.com/mobile/view/china-and-india-why-the-economic-
difference/22316 (24 February, 2020).
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