Economic Growth Of India And China

Great Essays
India, being the second most populated country in the world, at 1.295 Billion, has enormous potential within the world economic stage. While India and China share similarities such as population and region, their economies are vastly differing beasts. As of 2014 both India and China have an expected GDP growth of 7 percent, China’s economy is roughly five times the size in value. However, when adjusting for the the purchasing power parity, China still have two and a half times the GDP of India. The Indian economy for years has lagged behind other nations in raw output as well as in the human development index. The theoretical economic capacity of India is massive, but it lacks the infrastructure to to fully utilize its population, as well as …show more content…
The rural areas are even more underdeveloped than the urban areas. With most production being done by hand, the indian population is incredibly inefficient through its food production, but through government subsidies it creates a surplus of food which it exports. This creates a weird situation of poor conditions, as well as inefficiently paid workers, the government is subsidizing for basic food producers rather than creating the infrastructure or promoting innovations. This means that without the government subsidies, the food production is unsustainable. On top of that, due to the limited technology and rural infrastructure, a transition to a more automated agricultural market out be extremely costly. This would lower the cost of food but if the subsidy was removed, the living cost might not change substantially. However this would free up capital to better implement in the future to promote growth, rather than having to cover food costs per annum. With such a massive population, food production is of the utmost importance. But through the Government subsidizing the cost of food production through manual labor, not only does this promote inefficiency, but prevents the diversification of the workforce, leading to less specialization and is unsustainable within the long run. Creating a self sustaining agricultural market should be India’s prime objective, for subsidy depended …show more content…
While India’s national government is very large and cumbersome, in order for nations change, they have to coerce the provincial governments as well. Even without an active force of resistance, the raw amount of rallying that would have to be done to pressure action, is simply too large. Comparing this to Chinese system, where the Communist Party simply decides the course of action and is able to implement it at a national scale. Through India’s safeguards such as the heavy regulation, as well as leisurely paced advancement, the quickest way for change might have to be a political revolution, or a self induced revamping governmental regulation to promote economic

Related Documents

  • Improved Essays

    With the technology of today and the rate at which it is increasing farming will become a mechanized industry. Our nation’s current farmers rely on subsidies to make ends meet, but also to keep their…

    • 793 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    The intense famines in Africa are the result of many interwoven factors, but is the final straw the lack of water? It seems that the areas that can grow crops are over-farmed, and without heat-resistant seeds and irrigation the crops that do survive are not enough. Multiple years of crop failure are the foreshadowing of famine, pulling thousands already living in poverty into the cycle of famine, illness and death. Corrupt governments misuse donated funds to support military and other ventures, keeping the growing population in poverty. Many countries even rely on foreign food donations to support their people.…

    • 595 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    Morality For Their Starvation Free enterprise often results in the establishment of a more stable economy, offering, as a result, more financial opportunities. Hope rapidly grew among Indians as the economic liberalization of 1991 took place, promising them many opportunities for social mobility. However, because of the corrupt institutional system of India, the momentum for social growth was rapidly halted. Author Katherine Boo, in her book Behind the Beautiful Forevers, reports the consequences of India’s corruption in its poorest habitants, specifically in Annawadi. Boo maintains that Annawadians knew only “three main ways out of poverty: finding an entrepreneurial niche… politics and corruption,” (62).…

    • 1099 Words
    • 5 Pages
    Improved Essays
  • Improved Essays

    Australia and China both adopt a different economic system in exchange for a substantial economic growth to benefit their own nation. China being ranked 2nd in the world’s largest economy employs a command economy, which means the decisions on production and investment is decided upon the government. In comparison, Australia is a highly developed nation with a mixed market economy, meaning that the economy has a certain degree of planning involving the government, but the private sector dictates most of the economic decisions. The size of a nation’s overall economy is measured by the percent rate in Gross Domestic Product (GDP), which is the value of total productions produced by an economy in a given year.…

    • 1185 Words
    • 5 Pages
    Improved Essays
  • Decent Essays

    The initiative of Indian government is only individual survival, but most of the rural Indians have family. Their child(s), wife and eldery parents may not be earning. Thus, an assistance money from the Indian government is temporary solution because the money has to be spend everyday for food. However, the long term solution is provided to the rural Indians, education. The education is permanent solution because the rural Indians are well- educated.…

    • 86 Words
    • 1 Pages
    Decent Essays
  • Improved Essays

    Q.1 What is the central argument of the Asiaphoria by Lant Pritchett and Larry Summers? (300 words) The central argument of the Asiaphoria by Pritchett and Summers (2013) is that the accelerate growth rate of China and India will tend to a full regression to the mean abruptly. They conclude a pessimistic outcome on the prediction of growth in China and India in the further one or two decades. They argue that it is hard to use the past growth performance to predict the future growth and it seems unlikely for China and India to continue the abnormally rapid growth rates it currently anticipated.…

    • 1048 Words
    • 4 Pages
    Improved Essays
  • Decent Essays

    These two economic giants history stems from war and division to collaborations and international trading giants. Both have influenced other nations to venture out into the foreign land and develop their own countries to become global leaders. China and India's struggles during the 1800’s. China with lesser concerns economic growth because their population expanded rapidly, therefore productivity was on the rise.…

    • 147 Words
    • 1 Pages
    Decent Essays
  • Decent Essays

    Urbanization created an increased dependence on agriculture yet left no funding to support it. This caused small farmers to go out of business and agricultural corporations to take their place. Developing…

    • 169 Words
    • 1 Pages
    Decent Essays
  • Decent Essays

    India follows a parliamentary form of democracy, an inheritance passed on by its colonial masters, so there is a separation of power between the three organs as envisaged by Montesquieu. Though the efficacy of it still remains debatable as we follow a separation of functions and not of powers. And hence, we don’t abide by the principle in its rigidity.…

    • 60 Words
    • 1 Pages
    Decent Essays
  • Superior Essays

    This study, entitled India’s Economic Growth History: Fluctuations, Trends, Break Points and Phases found that in the half century since India broke free of British rule, little to no economic expansion or growth has occurred. Specifically, Virmani concludes that at the time of his study, just as it was when India achieved independence, the Indian economy was extremely reliant upon rainfall and other climate related variables, indicating that the Indian economy had not progressed to relying upon more modern industries. Additionally, with the exception of a few recent growth spurts, Virmani claims that there have not been any instances in which the Indian economy has grown at a rapid pace, which most healthy economies experience with some consistency over such a long period (Virmani 100 – 101). Although this is a singular study, it is certainly indicative that in the half century since India has achieved independence, it has yet to establish itself as a stable economic power despite its vast population and human capital. Undoubtedly, the difficulty that India has had economically over the last fifty years can be traced back to its time as a subject nation.…

    • 1496 Words
    • 6 Pages
    Superior Essays
  • Improved Essays

    Banerjee and Duflo’s article The Economic Lives of the Poor, studies five main areas of the living conditions of the extremely poor: food and its alternatives in spending, savings, work and specializations, infrastructure and health services, and education. In their study they found the percentage of income families spend on food, stays relatively the same even if their income goes up (Banerjee and Duflo, 2009). Families save very little money for lack of somewhere safe to store it, and when they take a loan, it is from their friends and family and not from banks (Banerjee and Duflo, 2009). Workers in developing countries lack specializations since it can be too risky to put all their time and resources into one industry (Banerjee and Duflo,…

    • 953 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    China and India, two of the best-known countries in the world, have come a long way since their civilization days. However, how did these two compare to each other a couple of centuries ago? Some significant ways in which they were similar and different to one another include their social structures, political structures, cultural beliefs, and economic structures. China and India both began to develop along a certain river, the Chinese being the Huang He and Yangtzi Rivers and the Indian being the Indus River. Both civilizations arose from these points on; they established themselves along their respective waterways and kept spreading in order to continue growing.…

    • 690 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    4. Improvement in Standard of Living The standard of living is improving in rural India at an increasing spread, since there is an improvement in literacy, savings and per capita income. 5. Improvements in Agricultural productivity Agricultural productivity are improving for different reasons • Improvement in irrigation • More use of high yielding varieties of crops • Better land use pattern IMPORTANCE OF RURAL MARKETING 1.…

    • 1222 Words
    • 5 Pages
    Improved Essays
  • Great Essays

    Climate change and clean energy productivity have been a focal point of new political policies as India strives to advance as a global powerhouse in the twenty-first century. Politics have been a relentless variable for India throughout the last several decades. While deliberately working to set them on a course to become a world power in the near future, political issues tend to haunt this ever increasing status quo. In a question and answer session given by Tim Roemer, former United States Ambassador to India from 2009 – 2011, Mr. Roemer articulates a brief idea of the current struggle in India’s political…

    • 1381 Words
    • 6 Pages
    Great Essays
  • Great Essays

    Pakistan is a politically unstable country. From 1990, the government has started to follow an open economy policy. Since 2000, the government has begun to remove barriers to foreign trade and investment, reform the financial system, ease foreign exchange controls, and privatize state-owned enterprises. According to State Bank of Pakistan (2004), economic mismanagement and fiscally imprudent economic policies caused a large increase in the public debt and led to fall in the foreign currency reserves in the 1990s. Pakistan is a low income country with uneven distribution of wealth.…

    • 3753 Words
    • 16 Pages
    Great Essays