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Economy of india and china

August 10, 2009

Five Reasons why India cannot match high economic growth of china

  1. China is a communist country and the government is all in all in every decision making process. On the other hand, India is a democratic country and Indian decision makers have to be accountable to the voters. So, Indian government cannot act so fast like Chinese government and also Indian government cannot neglect any part of the country.
  2. Chinese government does not have to worry about elections and public reactions. That is why, they could take some massive infrastructure projects in some of the large cities. On the other hand, Indian government has to focus on the development of the rural areas too and thus cannot concentrate too much wealth in building world class infrastructure facilities in any particular city
  3. Kapil Sibal viewed that China had become mainly an export oriented country where all the focus is increasing export. On the other hand, ¬タリIndia is a home-based consumption economy¬タル. So reaching to the rural people is very important in India.
  4. In China, it is easy for the government to acquire land and displace people for any large project. In India, it may often get the government into complex legal process.
  5. Poverty, illiteracy and unemployment- these are the major problems for India. So, until India can address these problems first, it cannot hope to achieve the same level of high economic growth like China.
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