India vs China—Who’s going to be the number one?
India and China – the two Asian giants – are world famous for their ancient architectural wonders, population, lead influence in the worldwide trade war, greatest military powers, and the front-line racers in the evolving phase of global supremes.
The two countries rank almost equal to various points of measurement. They stand side-by-side, racing against one another, and face-to-face in numerous points of comparison that collectively sum up to decide who has the adequate power to grab the trophy of earthly supremacy.
Some predict it by 2030 and some by 2050 that these Asian neighbors would erupt as the world’s most dominant economies. On the course to become number one, the strategy, so followed by these two nations has commenced gaining visibility from now only.
In a broad historical perspective, the renewed growth of China and India in recent decades is a return to the situation of the past two thousand years. According to a study by Prof. Angus Maddison, University of Groningen China and India accounted for about half of the world gross product for 1800 years.
British colonialism in India and China’s opium wars with Britain constituted the fault line
for two huge civilizations that were in decline in relation to the technological, economic, and military growth of the Western powers.
It took them time, but now that they have both returned to the top of the world powers, each in a different position, there is an inevitable confrontation over their position in the world’s top superpowers.
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How close is the competition between India and China?
Although these two giant landmasses are neighbor, there is a partially visible economic rival on rising between them.
China, leaping through economical ranking, has emerged as the second-biggest economy in the world; India, on the other hand, is running on number seven.
India’s ‘Neighborhood First’ initiative is one of the crucial steps taken by Indian Prime Minister Narendra Modi, which targets to improve diplomatic ties with neighboring countries like Pakistan, Sri Lanka, Nepal, Bhutan, and Myanmar.
According to Asma Masood, Research officer at the Chennai Center for China Studies, India is ready to evolve as the third-largest economy by 2028, and the second largest by 2050. He shows light on how this future outcome is possible.
“Such megalithic revolution within a short time constraint couldn’t be achieved by domestic development and relationship fostering with developed countries only. India will have to go many miles, by covering the fundamental aspects such as technology adoption, education improvement, large-scale energy production, and economy strengthening, among many.”
For China, currently, all the ways look open and unfolding into a better future.
With an authoritarian Government – completely devoted to the economic growth – in power, China has quickly secured its throne among the world leaders.
The economic explosion began with the futuristic vision of Deng Xiaoping, who set the right tone for China to become a future power.
Nothing since then has run off the track, including ideology, flow, community politics, and leadership. With such wild intentions loaded in the roadmap to erupt as the supreme power, the two rivals are set to go in for a war, to prove their supremacy.
India vs China: Comparison of the competitive verticals
Since 2015, the headlines of almost every newspaper started covering headlines regarding India’s overtaking of China in terms of GDP growth rate. This, somehow, the Indian side of media portrays as India is on the path to replicate China’s success story. Despite the efforts made to hyperbolize the growth rate of India, the statistics seem always confusing.
Although Indian media has exerted a lot of efforts to put statistics of both the economies in closer ties, India has still a long way to go before it could really catch up with the flight of the dragon.
Whereas India, on one side of the Himalayas, has made rapid strides in recent years for becoming a global economic powerhouse, China, on the other side, has already been doing the same for decades now.
China produces a lot more than what India does. The yearly production capacity of China surmounts the production capacity of its close rival, India.
Given the benefit of better infrastructure and modern production techniques, it’s easy to guess why Chinese workers produce 1.6 times more output than that of Indian workers. Overall, as a nation, the productivity of China is 60% higher.
For Indian manufacturers, many hurdles obstruct manufacturing productivity. These problems conjure up to reduce what the sheer-size Indian workers can collectively produce. Such drawbacks that stop Indian manufacturers from yielding high manufacturing are erratic electric supply, expensive transport systems, and the lack of skill sets for proper manufacturing productivity.
As these problems are structural, it seems against the odds for Indians to gain back a lead in the game – when the nearest country, China, has already broken all these barriers to gain a towering lead over any close competitor.
The workforce is a positive point for the Indian economy, compared to Chinese. India claims to be the world’s second-largest English-speaking nation. Respective to the menial jobs done by Chinese, Indians have high-end jobs, at the other end, powered by a boom in the information technology industry and BPO sector.
Of about over a billion headcount, about 125 million people speak English. Because of such dominant English-speaking population, the Indian workforce always gets a push over the Chinese people who lose the battle of translation – or the assimilation power because of the language barrier.
In China, no such dominance of English has yet originated. In China, Only a handful of people – around 10 million out of 1.3 billion – find English useful, or practice in day-to-day life.
Considering the polarity of the world toward high-skilled job preference, Indian workforce has larger chances to rise in prominence. The case adversely defines the case of the Chinese workforce, which may soon collapse because of the poor nature of work.
The economy of China is four times larger than that of India
The GDP of China is four times that of India; the GDP of India is $1.5 trillion, and GDP of China is $7 trillion. To spice up the growth fact, consider this interesting fact: even if China follows a dirt-filled road and speeds up at a meager 1.5% rate; and India takes a fresh, concrete-built road and speeds up at 7%, the two economies would end up adding the same amount of output to their respective side.
At this point in time, a comparison of the growth rate of two horn-locked nations makes little sense, especially when China has kept its growth rate consistently higher than India for over the past three decades.
It has not been even a few quarters in a row when India has signaled a swing in its mood for advancement. If – only if – India continues to beat the growth rate of China, that too by a broad margin, the current setup of the sky (China) and earth (India) could capsize.
Inflation in India is 6 times higher than it’s in China
The GDP growth rate of India is abruptly married with an out-of-control inflation rate, which is huge—about 6 times higher than it’s in China. For India, it’s a warning signal if it has any intention to take over China’s growth.
Such a mismatch indicates how the monetary policy devised by the people in power, in India, has failed to read the direction of the economy flow.
In China, the inflation rate has been relatively silent, maintaining a negligible 0.8% bounce for a long time. China’s strategy – sovereign wealth funds invest in foreign assets – combats against the inflation rate, which is a reflection of the surplus tax China has been facing of late.
One Child Policy – China Vs India population
Control of the population explosion is one of the major problems for both of the nations. In China, the current scenario has gone on to conditioning that the government has to interfere with the natural capacity of a human to reproduce, bringing the most a couple can produce down to one.
For the past couple of decades, China has strictly followed the one-child policy. The current demographic of China is worse than ever. It has more senior citizens that the working class which forces a single Chinese worker to pay for the survival of two retired folks.
Currently, India is free from such a population time bomb disaster. It has got a skilled workforce. It’s in the hand of the government to make use of the massive population size. If the government succeeds in employing the skilled workforce, the economy of the country is likely to boom up in the near future.
According to economics gurus, Chinese, in the long run, don’t have a roadmap set for the rise of entrepreneurship, but Indians have. Everything related to innovation and idea inception gets throttled under the communism bar. The negative effect of the communist government comes into picture when the halter to set a pace of the enterprises falls in the hand of state government.
Indians have a lead in this sector as they have a good command on intensive industries like information technology.
China, being a full-fledged superpower, has slowly begun to show signs of decline, which will become clear in time. There is a long way to go before anything certain could be announced in favor of these two competitors.
Urbanization in India and China
How good or bad are China and India in implementing urbanization that is progressively gripping the two giant neighboring landmasses?
In China, urbanization has taken off at a tremendous speed after the 1990s, while India’s pace has always been gradual. India and China can profitably prospect, but both of them have issues to grapple with.
In July 2014, In India, the new government in its budget earmarked a sum of Rs 70 billion to set up 100 smart cities. In China, its first urbanization policy was announced in March 2014, which was just three months before that of India.
A study conducted on this topic states that only India and China alone accounts for over 62% of the growth in the urban population in Asia. China has grasped and shaped the process, while India is far behind if we talk about urban opportunities and realities.
In China, the GDP is projected to be seen at a growth rate of 7.3 percent a year, from 2015 to 2025, whereas in India GDP will grow to 6 percent. There are 55-million middle-class households in China, at present, but this number could rise to over 280 million by 2025.
McKinsey Global Institute conducted research that expects China to add 400 million to its urban population, which will become 64 percent of the entire population in 2025; and expects India to add 215 million to the urban population, which in 2025 would become 38 percent of the total population.
Computing the last ten years of data from 2008 to 2018, India has added around 700 million to 900 million sq meters of area, while China was already on 1600 million and reached to 1900 million sq meters of floor space.
China adds 1,000 kilometers of metropolitan railway and subways annually, with the increase in the speed of urbanization as well as population, whereas India adds 400 kilometers of railways and subways every year.
China has already developed a set of consistent practices internally across all the elements of the operating model of the urbanization. India, on the other hand, has hardly paid attention to its urban transformation model.
China has urbanized at a rate of 41 percent. India is far behind from China if we talk about numbers – and that is just 29 percent. Though India is doing well than before and gaining rapidly in terms of urbanization and overall growth perceptive, still it will take a lot of time to shape up the process the way China has.
The Trade War: Who rules Asia – India or China?
“In the current trade war underway between China and US, India is emerging as one of the biggest beneficiaries while strengthening its position on the global trade level.”
India and China are the two giant economies of the world. The trade war between these two is always a hot topic for debate, due to their economic values and their trade with other nations of the world. It is not new that China has ruled the world’s trade for a long time, all because of its robust trading models and manpower.
But the recent tension between the US and China has changed the game. China has received a big hit due to the ongoing tension, and this has severely affected the trade, giving a push to the Indian trade as a side-effect.
Donald Trump – the current President of the United States – has implied hefty tariffs on aluminum and steel imported from China, which has shaken the foundation of the bilateral trade agreement between the two entailing nations.
In response to these revisions, China has also implemented new tariffs to create difficulties for the United States.
As per Forbes, the export from China has poorly declined in December 2018 and has unexpectedly dropped below the red line. This declination has signaled that China may lose the game in all fields if this trade war continues.
Also, the arrest of the Meng Wanzhou (CFO of Huawei) in Canada for breaking laws sanctioned by the U.S, has fueled the fire and has created trouble for China.
The UN said that if the U.S. and China don’t drop these high tariffs, the duties applicable on the products of each country will rise to a whopping 25% from 10% (which is applicable now).
This high tariff application has pushed the US Export market to vacate Beijing. As a consequence of this tariff tug war, the result is expected to turn in favor of India, which will provide it with the opportunity to bag the US market.
Also, it is evaluated that hundreds of Indian products will substitute the US Exports to China, which accumulated a whopping $130 billion in the previous year.
China strived hard to make things good with the European Nations, assuming they also oppose Donald Trump, but things didn’t work out, and China could not convince them in its side.
The countries, gaining a significant rise in the exports, which are getting benefits from the US-China Trade war are Vietnam, Brazil, India, and Australia.
Another report from Forbes disclosed that Beijing – the capital of China – would curtail its official GDP from 6.5 to 6 percent, based on the current tough situations.
So, things are turning out fruitful for the country like India which is benefitting from the perpetual war going on between the two developed nations.
If situations remained the same, India will get the most benefits because of its versatile market and soothing export policies.
It is not deniable that China is still in the 2nd position in global trade. The situation is not simmering in China as there is no upcoming election. Xi Jinping will handle the command of the country for now.
If the current situation goes on further, it is expected that India will show remarkable growth and will take place in foremost places of the global trading countries.
But now, despite significant losses, China has still sustained its position, and it is expected that it will take all the preventive measures required to retain its position while chasing the world’s finest and leading trading nation – The United States of America.
Between China and India, who has the potential to become the world technology leader?
There is a wide technological gap arising between India and China, of late. China, comparing the pace of its technological growth with the US’s, has inclined toward research and development, innovation, and cutting-edge technology.
As China has already taken a plunge into the scientific and technical territory, India has miles to go before it could even fall in the range of the technological dominance that China has plans to architect.
India, in contrast to the huge technological interest exhibited by China, has mainly relied itself on the waves emerging out of the western lands. Such negligence in technological revolution paints a dormant viewpoint of India when the trajectory followed by China is beyond any country to scale up.
When China is progressing by leaps and bounds, where does India stand?
- According to OECD report, China, after the US, is the largest investor in R&D and is on the verge of becoming a global leader in research and development. Its investment is as large as 21% of the world’s total. Chinese investment has been going up at a whopping 18% per year, followed by the US’s 4%. India’s R&D, at 0.7% of GDP per year, spending has been stagnant for 20 years. Whereas private investments in India has been partially blank, Chinese private firms are taking a keen interest in technology explosion, supplementing around 50% share.
- China, with the aim of promoting technologies such as artificial intelligence, robotics, and big data, has established many high-tech industrial parks and incubators across the developed states. India has been performing dwarf in such domains of futuristic hope. Compared to a towering 56,000 robot units acquisition by China, in recent years, India has purchased a mere 1,900 industrial robots, reflecting its dull mood toward science & technology embracement.
- Until now, China used to be an assembler of high-tech components. But, with huge investment in R&D, it’s emerging as the maker of supercomputers and a world leader in quantum communications, quantum computing, electrical vehicles, and biotechnology. India lost the first acquisition attempt of Tesla motors establishment outside the US, to China.
- With a raising of about $300 million, Indian AI startups are on move, getting prepared to fight strongly against the closest rival, China.
China Vs India – Potential War
The growth of China and India has undoubtedly supported the economic rise of Asia for a decade-long period now. But, as both of the nations kept getting stronger, there has unsurfaced an unprecedented pressure as army clash that dis-balances the long-held power and security order.
The recent military tension rise between PLA and the Indian Army in the Doklam region appears to have unveiled a new era of India-China policy.
The spark that triggered with the collision of two nations back in 1962 burgeoned once again, with the acquisition attempt of the disputed land, Doklam, by China. The most interesting fact about this dispute was the location where the air was getting warmer every second by the statements shouted from the defense community of both the nations.
The encirclement drawn by Chinese in the north from the Himalayas and Chinese seaports establishment in the Indian Ocean in the south leaves India geo-politically exposed to a multi-front war should hostilities reoccur and escalate.
Taking inspiration from the South China Sea incident – the disputed dice roll by China of demarcating the Philippines from a vast range of oceanic territory – India is on the lookout to take a firm stand against China -Pakistan Economic Corridor.
The recent border tensions arising out of the two-side vulnerability – by China and Pakistan – occupies India’s strategic mindset and military posture for the obvious reason.
South China Sea Issue
Through the development of China-Pakistan Economic Corridor, influence in Indian Ocean region, String of Pearls, one belt one road, China has always been pursuing an offensive-defensive strategy against India, for a long time now.
India, not in the position to counterbalance its neighboring superpower’s intention, has remained silent against such challenges. It’s only through its recent involvement in the South China Sea dispute, India, implementing its Look East Policy (LEP), has tried to outweigh China’s dominant capacity.
South China Sea homes many marine navigational routes that connect Asian countries to the receiving reaches of the world, for the purpose of trade. If this disputed land – as claimed by China under the nine-dash lines shadow that demarcates almost entire the South China Sea as Chinese territory – gets under Chinese, trade and maritime route for most of the Asian countries would get destabilized and liable to abide by China-devised policies.
India’s interest in the South China Sea is deepening because of the huge energy resources available in this region and trade-flows. To counteract the acquisition strategy of China, several countries are coming together to raise a mutual voice, through dragging this case to the International Tribunal for the Law of the Sea or International Court of Justice in The Hague.
The panel rebuked China for exhibiting the monopoly, but how seriously Beijing abides by this decision is only a case of smoke and mirrors.
Quality of life: China VS India
It’s entirely undeniable that India is emerging as one of the fastest thriving economies across the globe. On the other hand, China is a front-line runner in this field.
The quality of life comparison between India and China has attracted a lot of heat and arguments from various corners of the world.
Let’s find out which country has a leading edge over the other in terms of quality of living.
Per capita income
Per capita income is the most preferred way of evaluating the quality of life in a particular country. The more the dwellers are earning, the better will be their lifestyle and better will be their future.
As per the stats released by The World Bank, “Per Capita Income of an average Indian is 7,060 PPP dollars (2017).”
And when we see the side of China’s vis-à-vis per capita income, there is a massive margin India has to fill up.
“Per Capita Income of an average Chinese is 16,760 PPP dollars (2017)”.
Ain’t that a considerable difference?
Another crucial factor that comes after per capita income is the unemployment rate. The unemployment rate has a direct hit on the quality of life in a particular nation.
In terms of the unemployment rate, India has skipped a position, from 3.52 percent (2017) to 3.53 percent in the year 2018
In China, the unemployment rate has decreased to a level of 3.80 percent (2018) from 3.82 percent in 2017.
Still, China has much more unemployed dwellers when compared to India.
Life Satisfaction Rate
Life satisfaction rate means the amount of satisfaction a person is having from living in a country.
The life satisfaction rate in India is 2.7% and the same for China is 2.6%, which makes India and China equivalent in terms of life satisfaction rate.
India and China may not be the happiest countries of the world, but there is a massive difference in the happiness of the people.
India holds 36th rank in the list of the happiest countries and China holds 29th rank in the same list which is equivalent to a margin of 23%. In short, the people of China are 23% happier than the people of India.
Quality of life index
The quality of life index directly shows the clear winner. Whereas India has 74.99 quality of life index, China has 20.06.
From the above comparisons, it is clearly visible that India and China both are giving neck-to-neck competition to each other, but India is leading the game in terms of Quality of life Index. China may be a more powerful, more developed, and bigger nation, but India leads it with a better quality of life rate.
How is China doing better in Sports than India?
We all know that China and India are at the topmost position in population. China ranks first and India holds the 2nd position. But when we talk about sports, India is way behind China. Also, there is very less scope of improvement visible as of now.
What is the reason that China ranks higher than India when both countries have such a massive population?
This question always remains unanswered, so we evaluated the depth of reasons and excavated the history to find out why.
Popular Sports in both countries
China and India both nations have a different taste of sports. Whereas Indians love to play cricket, soccer, and hockey; Chinese love to play basketball, soccer, and sports-related to running activities.
Higher investments on players
Every country has a specific budget to shell out on sports maintenance. In terms of investing in players, China is ahead of India. China spends more on the development of a player than India, and it is the core reason why Chinese players perform well in sports and Olympic events held across the world.
Best-in-class equipment and infrastructure
An exemplary way to increase a sportsman’s performance is by providing him with top-of-the-line sports equipment and great infrastructure. How could players deliver the best performance if their equipment is outdated and out of stock – a satire that mocks the sad part of Indian sports (apart from cricket)?
China understands this and upgrades the equipment and infrastructure timely. Have a look at the infrastructure of China and India: you will notice a massive difference.
NOTE: We are not saying that India has poor infrastructure, but China is leading the game with a huge margin.
It was recorded that India sent a total of 83 athletes to participate in 13 games that were held in 2012 London Games. In the same event, China sent 396 Athletes for participating in 23 sports.
China bagged 88 medals, and India satisfied itself with 6 medals only.
Look at the massive difference! It is clearly visible that China is very active in terms of sports, and this nation takes things seriously.
They started at an early age
The people of China indulged into sports activities from an early age. Same is the case with India, but Chinese people have a better rate.
Whereas Chinese parents see sports as a lifetime opportunity and start training their children for sports activities from a premature stage, Indian parents have a different mentality, proving why China is miles ahead. Sports is not taken as a source of recreation and somewhere in the stage of an individual, the attention for sports succumb to flourish.
The parallel strategy of India and China for strengthening ties with neighbors
Economic Relations of China with Others
The CPEC (China-Pakistan Economic Corridor)
Since its inception, the CPEC is a headache for India. CPEC is the Economic Corridor that lies between Pakistan and China; to be more precise, it lies on the Gwadar Port. The CPEC is one of the flagship projects for China, and the country is looking to expand its roots to procure tremendous benefits.
This Economic Corridor will overlap the POK (Pakistan Occupied Kashmir) and will help China in expanding their business with other nations through Central and Southeast Asia.
Nepal China Economic Cooperation roots back to the time of 1950 when both the countries agreed to the formalization of their bilateral relations. Since that time, the Government of China is sanctioning various grants for the development of Nepal.
There are three categories of grants Nepal receives from China
- Interest-free loans
- Concessional loans
Ongoing Chinese Projects on the land of Nepal
- Up-gradation and transformation of Rasuwagadhi-Syaprubensi Road
- Up-gradation and transformation of Civil Service Hospital
- Kathmandu Ring Road Improvement Project
China and Nepal are sharing a friendly bond since ages, and their bilateral relations are proving why there is a decent relationship between them.
Asian Infrastructure Investment Bank (AIIB)
In January 2016, China established the AIIB, a global investment bank with 93 member countries, which provides an alternative to the old World Bank, which has 180 member countries.
As the World Bank serves as an instrument of influence of the West while providing loans to different countries, and provides the granting of loans in the implementation of economic or political reforms,
Thus, the AIIB serves as a tool to expand China’s influence.
But unlike the World Bank, China has a policy of non-intervention in the internal affairs of the countries that receive the loans, does not require reforms and thus takes a greater risk. The Bank helps China establish its status and influence in East Asia and beyond.
The Belt and Road Initiative (BRI)
The BRI project is probably the largest project in human history. The project is intended to re-establish the ancient Silk Road, by land and by sea.
The project’s budget is estimated at about $ 1 trillion, which will be allocated for the establishment of infrastructures in various countries. Ports, roads, railways and more.
The interest of the countries participating in the project is clear: establishing infrastructure, creating jobs and connecting to the main route of transportation of goods from China to Central Asia, the Middle East and Europe.
The Chinese interest is also clear, the faster and cheaper transfer of goods, which will lead to increased competitiveness and strengthening of the Chinese economy. In addition, strengthening China’s influence in Asia and Europe.
Economic Relations of India with others
India has extended a financial grant to Nepal.
A 35.5 million Nepalese rupees grant is assigned to Nepal by the Indian Government for the construction of an educational campus. As a result, the knot of relations between India and Nepal has improved. The grant was sanctioned by Development Administration Partnership which comes under the Ministry of External Affairs.
India and Bangladesh are on a fruitful journey of export and import
India and Bangladesh are two neighbors that share the southeastern boundaries and have friendly and decent business relations. The year 2017-2018 marked itself in the history of trade as the export and import business between India and Bangladesh crossed the line of $9 billion.
The exports that were made from Bangladesh accumulated up to $900 million and are expected to cross the mark. The reason behind the sudden growth is SAFTA (South Asian Free Trade Area) Agreement, by which India has allowed duty-free imports from Bangladesh.
The recent move by India – a heavy foreign investment into the developmental projects across Bangladesh—reflect the transforming view toward partnering and knotting strong ties with neighboring nations. In Bangladesh, India is fighting hard to improve a relationship with the host, with a hope to counterbalance Beijing’s intensified regional conquering intention.
India raised the customs duty to 200% on Pakistan Imports
The world knows that the relation between India and Pakistan are spiced up due to the continuous ceasefire violation by Pakistan. As a result, India has raised the import duties to 200%.
China is getting benefits from this duty implementation and is strengthening the EPEC to rule the East Asia Corner by expanding its business.
In an attempt to nail down the regional supremacy, the governmental investment is a one-trick pony that a country can think of when competing against a big opponent. Be it a one-sided sword, but it’s proving beneficial for China, especially in Asia, Africa, and the wider world.
China Vs India Summary
It is very difficult to predict what the future will bring with him. There are many parameters that can radically change the picture one way or the other. A war between China and the United States could do to China, what the opium wars did in the middle of the nineteenth century, and thus completely change the whole picture.
On the other hand, a good agreement with the United States, managing the crisis in the South China Sea without getting into unnecessary adventures, can leave China in the direction of accelerated growth. And yet this is just one of many other equally significant factors, such as the aging of Chinese society, political shocks, and more.
For India, the picture is no different. Although India is currently in a good growth trend, there are factors that can turn the picture upside down, such as a deterioration into a full military confrontation with Pakistan that could exact a heavy price from India and delay its continued growth. And here, too, it’s only one parameter.
There are other parameters who can influence this way or that, like the hundreds of millions of Indians who live on less than $ 2 a day, the political system stability and more.
If there are no dramatic events that will change the game completely, the two ancient civilizations that have shaped the face of East and South Asia will continue to compete for the crown of leadership in East Asia, where the advantage now tends toward China.