INDUSTRIAL CONTRIBUTION TO THE

ECONOMY
ROLE OF THE GOVERNMENT
• The Chinese government wields industrial policy to help improve the
competitive standing of Chinese firms.
• It is now generally accepted that government intervention has at times
played a positive role in promoting economic growth in the high-performing
economies of East Asia.
• Industrial policy—measures that favor one or more industries over
others,can take a range of forms, such as educational programs, export
subsidies, and preferential loans.
• The Government has nurtured the industrial sector based on 3 factors:-
a) Industrial structure-
Simultaneous growth of both small and large scale industries has
been favoured.
The government has also encouraged many startups and ideas at
 the incubation level
b) Foreign Investment and Technology Transfer
c) Absorptive Capacity
AGRICULTURAL INDUSTRY
• China is one of the world's largest producers and consumers of agricultural
products with approx. 300 million Chinese employed by this industry.
• It is the largest producer of rice & principal source of crops like
wheat,maize,cotton,tea etc.
• China practices “intensive cultivation”,i.e.,it cultivates as many crops as
possible on the land available to them.
• This results in high yields & increased foreign trade revenue.
• Animal husbandry is an important branch of the agriculture industry,with
China being the largest producer of livestock.
• The industry contributes to 13% of the country’s GDP
MANUFACTURING &OTHER
INDUSTRIES
• China accounts for about 8% of the world’s manufacturing output & ranks 3 rd worldwide
in industrial output
• Notable industries are mining and ore processing,aluminium,iron and steel,consumer
products,etc.
• Machine building & metallurgical industries account for 20-30% of the total industrial
output.
• Growth in the chemical industry has made China one of the largest producers of
nitrogenous fertilizers.
• Textile manufacture sums up to 10% of the gross industrial output
• Consumer goods like clothes & electronics form a major chunk of the country’s exports.
• Other industries like construction,steel ,automobiles and tourism have also made
considerable progress.
• The overall industrial growth has been steady at about 10% per year.
• This sector amounts to 46.8% of the country’s GDP
THE SERVICE SECTOR
• Once described as “the iron rice bowl”,China has recovered to have more
labour friendly laws and is constantly devising ways to keepup its socialist
image and provide for its people.
• China's services output ranks fifth worldwide;accounting for approximately
40.3% GDP.
• Public administration being the mainstay of this sector,other avenues like
tourism,and private firms are also providing employment to the people
EXTERNAL TRADE
• International trade makes up a sizeable portion of China's overall economy.
• The course of China's foreign trade has experienced considerable
transformations since the early 1950s.
• Since economic reforms began in the late 1970s, China sought to
decentralize its foreign trade system to integrate itself into the international
trading system. On November 1991, China joined the Asia-Pacific Economic
Cooperation (APEC) group, which promotes free trade and cooperation in
the economic, trade, investment, and technology spheres.
• Imports are a major means of trade.The country imports large number of
goods from South-east Asia,U.S & Russia
• Export growth has continued to be a major component supporting China's
rapid economic growth
• About 80 percent of China's exports consist of manufactured goods, most of
which are textiles and electronic equipment, with agricultural products and
chemicals constituting the remainder. Out of the five busiest ports in the
world, three are in China.
• The China Council for the Promotion of International Trade (CCPIT)
promotes China's international economic and commercial interests. This is
accomplished by developing business cooperation and exchanges with
foreign countries. It also produces economic data, creates diplomatic ties
and is active with trade arbitration issues.
FOREIGN INVESTMENTS
• Foreign-invested enterprises account for 58–60% of China's imports and
exports
• Foreign investment remains a strong element in China's rapid expansion in
world trade and has been an important factor in the growth of urban jobs
• China is now one of the leading FDI recipients in the world, receiving almost
$80 billion in 2005 according to World Bank statistics. In 2006, China
received $69.47 billion in foreign direct investment.