India and China

Kavita Antony – M 03Suhas Haldankar – M-14Hussain TinwalaRohan MehtaPratik Gada

Contents Introduction

Strengths of Indian and Chinese Economies

Weaknesses of Indian and Chinese Economies

Opportunities for both the economies

Threats from each of the economies

Conclusion

Strengths of the Indian Economy

Favourable Demographics

Scope for increase in efficiency

Positive Growth Forecasts

Well placed for globalization and outsourcing

Strengths of the Chinese economy

Proactive nature of the Chinese.

Making more competitive products. Investing in science and technology. A cheap workforce. Government-led investment

Weakness of the Indian economy Snail pace of the Indian Government Dependence on agriculture, Monsoon dependent

trade. Lags behind in social development … Below

poverty line. Literacy rate Lack of adequate infrastructure, Electricity,

Roads, Ports etc.. Bureaucracy and corruption Foreign currency risk,

Weakness of the Chinese economy

Lacks in “True” innovation. Lacks “High Standards” and “Integrity” A lack of “Adherence to principles of academic

integrity” Strong centralization of political power [CCP -

Chinese Communist Party] Corruption & Lawlessness.

Competitiveness Index - 2012

Competitiveness Index - 2012

Opportunities for the Indian economy

Agriculture and SMEs sector needs to be

encouraged.

Defining and properly implementing the policies.

Scope for large-scale infrastructure development.

Tourism is a thriving industry.

Opportunities for the Chinese economy

Strengthen the institutional regime and improve

governance.

Unleash the human potential.

Boost innovation capacity.

Further harness ICT for economic and social

development.

Threats to the Indian Economy

Illiterate population easily exploitable.

Lack of Capital, Needs for Education, Infrastructure Development

Corruption has blocked potential investors.

Rupee remain unstable against other foreign currencies

Threats to the Chinese Economy

China’s supply of cheap labor is going to run out sooner, as China and its citizens become wealthier.

Absence of high levels of R&D investment could lead to drop in the level of innovation.

Because of its authoritarian government, oversight by opposition political parties and a robust free press is sorely lacking.

Conclusion After several decades of sluggish growth, the Indian

economy is now amongst the fastest growing economy in the world. Economic growth is currently 8-9%, second only to China.

Despite several  problems facing the Indian economy many economists point to potential strengths of the Indian economy which could enable it to continue to benefit from high levels of economic growth in the future.