http://www.opinionasia.org/ChinalearnIndia


Now its China's turn to learn from India

Lee Cheong Seong
02 May 2009


In terms of growth, the two bright spots in the global economy also happen to be the two most populous countries: China and India will likely grow at more than 6 percent in 2009. But that is where the comparison should end. China has been the hero over the last three decades. In 2006, Indian Prime Minister Manmohan Singh asked what Mumbai could learn from Shanghai? But the time has come for Beijing to learn from New Delhi.

Beijing is building its way out of an economic slump roads, ports, railways name anything big and theyre likely to be building it. But Indias approach has been different. Indians, including the poor, are looking to consume their way towards further growth. Sure, the demand for handbags, air travel and fine dining in Mumbai has collapsed but the real indicator of economic progress in developing countries is how the poor are getting along. In terms of poverty alleviation, China had a huge head start. It began free-market reforms in 1978 while India only started on its current journey in the early 1990s. But since the turn of the century, India is rapidly improving while China is getting worse.

China and India have something in common: half of the people in China and two thirds in India still live in rural areas. That means about 700 million people in each country, most of whom remain poor. Progress in rural areas is a strong indicator of overall economic progress in developing countries. But this is where the paths of both China and India are diverging.

In China, the urban-rural income ratio was 1.8 times in the mid 1980s, 2.4 times in the mid 1990s, 2.9 times in 2001, and now around 3.5 times. The 1980s was a golden period for Chinas poor. Over 80 percent of the poverty reduction that has taken place in China occurred during the first ten years of reform (1978-1988). Although per capita incomes have risen since then, an estimated 400 million people have seen their net incomes decline over the past ten years. Despite the decades of spectacular growth, absolute poverty as well as illiteracy has actually doubled since 2000.

Although beginning from a lower base, it has been a different story for India. The urban-rural income gap has been slowly but steadily declining since the early 1990s. Over the past decade, economic growth in rural India has outpaced growth in urban areas by almost 40 percent. Rural India now accounts for half of the countrys GDP, rising from 41 percent in 1982 and 46 percent in 1993. Importantly, agriculture in rural India now accounts for only half of rural GDP and is falling. Agriculture was responsible for around 72 percent and 64 percent of rural GDP in the 1970s and 1980s respectively. This means the development of a balanced economy is occurring in rural India, with rapid growth in non-farm sectors such as manufacturing and services. Unlike in Chinas already crowded cities, rural Indians do not have to migrate to urban areas to earn a better living.

The divergent path of these two developing giants is also demonstrated by the role of domestic consumption in the economy. In China, domestic consumption as a proportion of GDP has fallen from around 60 percent in the 1980s to 35 percent currently the lowest of any major economy in the world. The Chinese economic miracle is depending more and more on exports and state-led fixed investment. Even Beijing consistently admits that this is an unbalanced and unsustainable strategy. Moreover, depressed levels of consumption (and correspondingly high levels of savings) by the citizenry of a still poor country means that growth is uneven and benefitting the relative few. In contrast, domestic consumption makes up more than two thirds of the India economy. India has a lot of catching up to do but its poor are rising with the tide, unlike China.

Chinas emphasis on state-led fixed-investment growth in urban areas has exacerbated inequality in China and heavily favours a relatively small number of well placed insiders. It was a deliberate decision taken after the Tiananmen protests in 1989 in an attempt by the state to retake control of the economy. Rural China was the heart of private, entrepreneurial progress when reforms began in 1978. Mean household incomes were rising with the tide. Prior to Tiananmen, growth in investment by the private sector in rural China was growing at 20 percent. After Tiananmen, it dropped to 7 percent. Hundreds of millions of Chinese have since largely missed out on the fruits of the countrys spectacular growth.

Magnificent as Shanghai now is, its shiny buildings have been built on the back of the savings of Chinas peasants who are forced to deposit these in state-owned banks and receive little in return. No matter who wins the election, India would do well to avoid Chinas example.



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Let Noble Thoughts Come to Us from All Sides- RigVeda

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lol, just another article written by a journalist that doesn't understand either of the two countries....

China learning from india....l1o1l1o1l1l oh well, l11o1l1o1lo1l1l

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What a dumb Korean journalist.


Whoever said winning isn't everything must be a loser...

maybe we should learn from them so that we can catch up with the poor india within 20 years,lol.

ol, just another article written by a journalist that doesn't understand either of the two countries..
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of course .. :)any one disagreeing with official commy line is a fool ..

SURRENDER OF PAKI ARMY IN 1971
1N 1971 A NEW HISTORY AS WELL AS A NEW NATION WAS CREATED BY WE THE INDIANS..

of course, everyting is beyond your comprehension ability, punit...

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- Its is a dangerous hairy world out there. The hairless stand no chance.





Whoop Whoop, I have a crack in my armor.

Ich bin ein Geschlechtungeheuer.

We need to get on with this river interlinking project, this will really boost rural growth.

That author has an agenda lol.
At the bottom of the article it mentioned about his position and where he works and his book
something called: will china fail?
lol. he is like that guy gordon chang.
both are totally wrong!

why?!?!
because for very simple logic and common sense, not just understanding about human concepts
and nationalism,etc.

just look at the beijing 2008 olympics, the reason it was so successful was becoz evry chinese
citizen in china wanted to make sure it went very well!
regardless of how chinese gov /ccp(?), etc. would handle china's problems, economy, etc.
the citizens would want to participate and Make Sure everything goes well in the years and
decades to come.

That alone is enough reason why gordon chang and that guy, etc. are totally wrong.

The Gini coefficient

The Gini coefficient is a measure of statistical dispersion developed by the Italian statistician Corrado Gini and published in his 1912 paper "Variability and Mutability" (Italian: Variabilità e mutabilità). It is commonly used as a measure of inequality of income or wealth.

It is defined as a ratio and can range from 0 and 1 (0% to 100%): A low Gini coefficient indicates more equal income or wealth distribution, with 0 corresponding to perfect equality (everyone having exactly the same income), while higher Gini coefficients indicate more unequal distribution, with 1 corresponding to perfect inequality (i.e., a situation with more than one individual, where one person has all the income). To be validly computed, no persons can have a negative net income or wealth. Worldwide, Gini coefficients range from approximately 0.230 in Sweden to 0.707 in Namibia although not every country has been assessed.










R.K. Laxman, India's renowned cartoonist, honours the hardy & humble Indian Jawan

AKA KRONICFEVER

"The Gini coefficient"

it's sad to see a nation with about 40% people under property line, half kids under 5 are manutrished.But at the same time this nation has the biggest number of most rich people in the world,lol.I guess the lower Gini coefficient compared with China is due to having too many poor people?

\\Over the past decade, economic growth in rural India has outpaced growth in urban areas by almost 40 percent. Rural India now accounts for half of the countrys GDP...\\


This explains why Indian cities does not have those dazzling looks like chinese or north korean cities because the real growth is happenning in country side ! This is not to say that there are no inequalities in India.Farmers do commit sucide because of the low quality of seeds or non availability of irrigation water.But succesive administrations (both Congress and BJP) has always alloted more funds for rural areas because of their vote banks and now slowly the results are showing ! Of course there is still long way to go !

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Let Noble Thoughts Come to Us from All Sides- RigVeda

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So you can't compete on the cities, indians want to compare the rural area because it's murkier...l1o1l1o1l

There is no comparison...Chinese on average are 4 times richer and live 10 years longer; we are more efficient in using our land which is less than india's arable land....our crop yield is much higher than india's....So your rural area is even more backward compared with China's rural area v-s-v cities....

try again....

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"This explains why Indian cities does not have those dazzling looks like chinese or north korean cities because the real growth is happenning in country side ! "


Plz have you seen N Korean Cities? Basically the only city in North Korea is Pyongyang and it ain't dazzling at all.

The only thing China learned from India was to not have an uncontrolled birth rate.

indians can teach chinese how to be lame workers

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Pakistan Airforce: The largest distributor of Indian airforce parts in Asia



Pathankot Strike
8 F-86Fs of No 19 Squadron led by Squadron Leader Sajjad Haider struck Pathankot airfield. With carefully positioned dives and selecting each individual aircraft in their protected pens for their strafing attacks, the strike elements completed a textbook operation against Pathankot. Wing Commander M G Tawab, flying one of the two Sabres as tied escorts overhead, counted 14 wrecks burning on the airfield. Among the aircraft destroyed on the ground were nearly all of the IAFs Soviet-supplied Mig-21s till then received, none of which were seen again during the War.


http://www.youtube.com/watch?v=PFHlzP69n9c

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\\ we are more efficient in using our land which is less than india's arable land....our crop yield is much higher than india's....So your rural area is even more backward compared with China's rural area v-s-v cities.... \\

The point of the article is exactly that China is NOT efficient when it comes to equal development of urban and rural areas compared to India ! LOL


from the article posted,


'In China, the urban-rural income ratio was 1.8 times in the mid 1980s, 2.4 times in the mid 1990s, 2.9 times in 2001, and now around 3.5 times.'

'Although beginning from a lower base, it has been a different story for India. The urban-rural income gap has been slowly but steadily declining since the early 1990s. Over the past decade, economic growth in rural India has outpaced growth in urban areas by almost 40 percent. Rural India now accounts for half of the countrys GDP, rising from 41 percent in 1982 and 46 percent in 1993. Importantly, agriculture in rural India now accounts for only half of rural GDP and is falling. Agriculture was responsible for around 72 percent and 64 percent of rural GDP in the 1970s and 1980s respectively. This means the development of a balanced economy is occurring in rural India, with rapid growth in non-farm sectors such as manufacturing and services.'


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Let Noble Thoughts Come to Us from All Sides- RigVeda

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No. You obviously don't know how to measure agricultural efficiency. The article only talks about income disparity between city and rural. It seems the income gap is widening based on the article. That's because the income increase in indian cities are very, very, very slow versus that of china.

It has nothing to do with agricultural efficiency. To measure that, you need to look at crop yield, which is equal to the crop production divided by arable land. Since india has more arable land than China and lower total crop production, your agricultural production efficiency is a fraction of that of China...


Dude, you really don't know what you are talking about....

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Dude, This article is essentially about the income gap between Rural and Urban areas and inclusive growth.I was pointing out that fact. India's growth is much more inclusive compared to China's !


Since you brought efficiency of resources into this (agriculture or otherwise), then you should know that India is more efficient in using its resources than China.In fact , this is one of the things which the chinese experts specifically point out when comparing the India Model with China Model.


http://www.daliyang.com/files/Yang_and_Zhao_The_Rise_of_India-china_s_perspectives_and_reponse.pdf

The Rise of India: Chinas Perspectives and Responses

By Yang Dali & Zhao Hong


'While Chinas growth mainly stems from massive accumulation of resources,
together with public-sector investments resulting in impressive infrastructure, the
economic growth in India is largely achieved by integrating itself into the world economy,
and stressing on increasing efficiency. India does appear to be better integrated into the
international business society and is utilizing available scarce resources more efficiently
than China. For instance, according the EIA (Energy Information Administration, USA),
Indias oil consumption is currently less than 40 percent of Chinas, and in 2001, Indias
energy efficiency (energy consumption per dollar GDP) stood at 25,307 Btu (although
one of the least energy efficient countries in Asia), whereas Chinas stood at 35,619 Btu
(British Thermal Units).15 It is believed that the economic criterion for a countrys
economic success is not whether it can attract a lot of FDI, but whether it stresses on
efficiency, whether it has a business environment that nurtures entrepreneurship, supports
healthy competition and is relatively free of heavy handed political intervention.16 In
this regard, India has done a better job than China.'


May be i should post this article in full because the real chinese experts contradicts many of the WAFF chinese assumptions about India !





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Let Noble Thoughts Come to Us from All Sides- RigVeda

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whatever you quote, I can find 10 other articles to contrast that....so??? the fact is, China's economy is 4 times that of India while 30 years ago both countries are about the same. So who is more efficient? I know you will say india started reform only recently....Then I will say, China had mad communism for 30 years so India had a headstart in 1950 for 30 years....l1o1l1o1l

Facts remain, China is way more efficient than india that's why we are 4 times bigger....

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