Comparative Analysis India and China

ComparativeAnalysis India and China

Chinaand India are among the most ancient civilizations that began onearth. The two nations had made great advances in architecture,medicine, education and science (Fensom, 2014). Economically theywere very rich since the regions were endowed with precious stonesand other commodities on demand at the time. It was not until the18thCentury that the people of the two areas were deemed inferior andsomewhat backward by the Europeans that arrived. By the 19thCentury, India and China were already the poorest countries on earth.There main issue was the population explosion that led to the twonations to have a combined sum of half billion people in 1860(Fensom, 2014). More so, the outside world saw them as weak mindeddue to their many religions and superstitions. During the Cold War,the two countries were not able to participate in the internationalmarket. After the war, things changed and the regions began to beactive in trade, and that helped them boost their economy to thelevels they currently stand (Matsumura, 2016). This essay willcompare the growth patterns and strategies employed by India andChina and whether the political system and demographics will enableIndia’s economy to surpass China’s.


Chinabegan to grow its economy exponentially from the 1980s. The countrybegan to see a rise in its GDP till it began to increase at anaverage of 9.5% per annum (Garret, 2015). The growth enabled thecountry to generate more income that they used to develop theirinfrastructure. The move was strategic since China currently has thebest infrastructure among the countries that are not in the westernworld (Garret, 2015). However, after almost three decades of rapideconomic increase, China’s growth rate has begun to slow down. Theincome difference is very large with over 70% of the populationliving below the poverty line. China has strict residence rules meantto curb rural-urban migration. The laws are actively enforced makingabout 60% of the Chinese people to reside in the rural regions(Matsumura, 2016). The areas have an unequal distribution ofresources leading to the scarcity.

Indiabegan to improve economically ten years after China. However, unlikeChina’s rapid increase, India’s economy has been growing ratherslowly (Zhong, 2016). Currently, India is far behind China regardingthe GDP. The physical infrastructure is appalling when compared towhat is in China. Nevertheless, the two nations share the same issueof wealth disparity. The majority of the residents in India alsoreside in the rural sectors (Matsumura, 2016). After the financialcrisis of 2008, India continued to grow economically, but even at aslower pace. The situation makes the financial sector questionwhether India is capable of overtaking the economy of China (Zhong,2016).


Throughthe influence of the communist party, the People’s Republic ofChina managed to reform its market and began to spend heavily oninfrastructure and production (Garret, 2015). The improvement oftransport features such as rail and road began to attract foreigninvestors. These investors were also enticed by subsidies such as taxbreaks and other fee discounts. Production made China gain morerevenue through exports. The country is still among the topmanufactures on the planet. The socialist economy in China was farmore stringent on the locals. The regime controlled the market anddictated prices on its citizens. Thus, even though the economy wasimproving, the wage gap grew wider (Garret, 2015).

India,on the other hand, trails behind the economy of China due to severalreasons. India began its economic reforms a full decade later, which,gave China a head start. The country also invests only 30% of its GDPwhile China invests half of its GDP. On manufacturing, India spends20%, yet China does 30% (Garret, 2015). The difference is one of thereasons why India is behind China. India also does not have thecomparable infrastructure to China. Thus, foreign investors are lesslikely to prefer the nation. However, recent scientific innovationsshow a promising future for India as a new destination for investing(Zhong, 2016).


Comparedto India, China’s population is aging. As the people of Chinacontinue to grow older, they become less productive. India has ayounger population which means that in the next decade India willhave a higher production rate (Matsumura, 2016). The aging populationin China will also use up a lot of its revenue, unlike in India wherethey will be spending less. Thus, it is expected that eventually,India might surpass the economy of China if these projections remaintrue.


Thecommunist party has controlled China for many years. The people haveno voice, and the government dictates every part of their lives. Thesituation might change as more citizens continue to languish inpoverty. The uprising might destabilize the economy leaving China ata disadvantage (Matsumura, 2016). India has the opposite system inplace. Even the lower caste have a voice, and they can be heard. Thedemocracy in the country will help it remain peaceful (Matsumura,2016). Therefore, India is expected to overtake China’s economy inthe next few decades.


AlthoughChina already has an advantage over India regarding the economy.Factors like democracy and demographics give India an edge. Thepolitical structure of China may not last for long, and once it isabolished, the economy of the nation will suffer. As the populationof China ages, so will its productivity decline. India has a highpotential for growth. It has a stable government and a youngpopulation that will soon be productive. Technological progress inIndia is also on the rise, and it will attract more investors. OnceIndia manages to utilize these resources properly, they are likely tosurpass China.


Fensom,A. (2014). Can India Become the Next China? The Diplomat. Retrievedfrom: on September 29, 2016.

Garret,G. (2015). Can India really be the ‘next China’? The EconomicTimes. Retrieved from: on September 29, 2016.

Matsumura,M. (2016). Democracy as Economic Strategy India`s Strength overChina. Carnegie Council Policy innovations. Retrieved from: September 29, 2016.

Zhong,R. (2016). India’s Economic Growth May Have Already Peaked, RBIPaper Says. Wall Street Journal. Retrievedfrom:&nbsp September 29, 2016.