Some facts about India

• Democracy
• Mixed Economy
• Economic Reforms - LPG Liberalisation Privatisation and
Globalisation -began in 1991 under P V Narasimha Rao
and Finance Minister Manmohan Singh
• India started off 12 years after China and hence is
struggling to catch up
•
•
 Some facts about China
• Mixed Economy
• Third largest after US and Japan with nominal GDP 4.32
trillion
• sustained GDP growth of over 10% in the last 30 years
• Economic reforms started in 1978, foreign trade grew
faster than GDP for 25 years
• Big Push Strategy – 1949-1980. Government directed
efforts to install new factories.
• Economic reforms – 1978 – 1990
•
 Some facts about China

• Mao Zedong – First chairman of communist party of

China
• One of the 100 most influential people of 20th century
(Time Magazine)
• Believed to have laid the economic, technological and
cultural foundations
• Transformed China from an agrarian
 society to a major world power
•
 Facts about China

• Deng Xiaoping is the pioneer of economic reforms

• He was the policy maker
• Architect of socialist thinking
• Transformed China into a "Socialist Market Economy“
• Protection for private property rights
• 5 year plans implemented
 Economic Indicators
INDIA CHINA
Gross Domestic Product $1.22 trillion $ 4.33 trillion

GDP growth rate 7.9% 9.1%

Population (m) 1,123 1,319

Population growth (annual) 1.2% 0.6%

Inflation 8.3% -1.2%

Export of goods and services 24% 35%

(% of GDP)

Imports of goods and services 30.3% 28.4%

(% of GDP)
Comparison of GDP

1.22 T
Comparison of GDP Growth Rate
Sector Contribution as a % of GDP
Life Expectancy
Literacy Rate
Imports as a % of GDP

30.
3%

28.
4%
Exports as a % of GDP

35
%
Emission of Carbon dioxide
(In metric tons per capita)
 The Main Imports
India
  China
• Crude Oil • Electrical machinery
• Machinery • Petroleum and related products
• Gems • Professional and scientific
• Fertilizers and chemicals instruments

• Metalliferous ores and scrap

• Office machines and data

processing equipment

 The Main Exports
India  China
• Textiles • Home appliances
• Jewellery • Kitchen wares
• Leather • Sea food and other food
• Petroleum products products

• Engineering goods • Shoes

• Chemicals • Clothes
• Toys and bags


 Bilateral Trade

Year China's Exports to China's Imoprts

India from India

2000 1560.75 1353.48

2001 1896.27 1699.97
Percent Growth 21.5 25.6
2002 2617.73 2274.18
Percent Growth 40.9 33.8
2003 3343.59 4251.49
Percent Growth 22.2 87
2004 5926.67 7677.43
Percent Growth 77.3 80.6
Employment in various Sectors
Labor Force

523.5M 807 . 7M
 Investment and FDI
India
  China
• Investments (Gross Fixed) : • Investments (Gross Fixed) :
39% of GDP 40.9% of GDP
•
•
• Inflation Rate (Consumer
• Inflation Rate (Consumer
Prices) – -1.2% .
Prices) – 8.3% .
•
• • FDI – 70 Billion US $
• FDI – 36.7 Billion US $ •
 A Glance
Agriculture
INDIA
India 17.2%

GDP - $ 1.209 Trillion China 11%

GDP (PPP) - $ 3.673 Trillion

Growth Rate -7.9 %
Doubling Period - 9 Years Service
India 53.7%
China 41%
CHINA

Industry
GDP - $ 4.33 Trillion
GDP (PPP) - $ 7.8 Trillion India 29.1%
Growth Rate -9.1 % China 48%
Doubling Period - 7.9 Years
 The Big Picture …
INDIA
Focus on services
Lower GDP per capita
Strong corporate governance
standards
Advanced institutional
infrastructure
Commercially-driven companies
CHINA
Focus on industry
GDP per capita two times higher than
India’s.
Lack of advanced institutional
infrastructure and corporate
governance
Indifference towards oil prices
fluctuations
Global economic integration through
international trade and investments
Money Supply
 1245557Cr RMB 21.25T

475400Cr RMB 59.46T

4758404CrM3

India China
Monetary Policy
 Tools of China ’ s
Monetary Policy
Reserve Requirement Ratio15.5%
Central Bank Base Interest Rate
5.31%
Rediscounting
3.24%
Open Market Operation
 Tools of India’s Monetary Policy

Cash Reserve Ratio 5%

Central Bank Base Interest Rate
4.75%
Open Market Operation
 Other Policy rates …

INDIA CHINA
SLR 25% -

Repo Rate 4.75% -

Reverse Repo Rate 3.25% -

Exchange rate (per US $) 46.6900 6.8290

Fiscal Policy
 Funds Sources (Capital)
INDIA ($) CHINA ($)
FDI – Direct 27.460B 6,325.8B

Portfolio Investment 109.931B -

Borrowings (LT and ST) 44.042B 5,109.966B

Total Funds Sources 238.342B 11435.4B

 Funds Uses (Capital)
INDIA ($) CHINA ($)
FDI Abroad - Direct 12.990B 5,906.2B

LT and ST lending 1.623B

Total Funds Uses 224.917B

 Balance of Payments ($)
INDIA (2009) CHINA (2009)
Total Trade Exports 175.184B 1435B

Total Trade Imports 294.587B 1074B

Trade Balance -119.403B

179.9B
Invisible (Net) 89.586B 182.8B

Current Account Balance -29.817B 363B

Capital Account Balance 9146 111483.4

Reserves 20.080B 195B

 Thank You!
Group –
Section B.
Roll Nos. 2-20