CAN INDIAN ELEPHANT BEAT CHINESE DRAGON IN GDP?

China and India together constitute one-third of the global and one-half of the population of the developing world. If they can modernize their economic and political systems and alleviate the poverty that is ever so present in their countries, the world will arguably be a more stable place. Indias economy is expected to grow at 8.5% this year. Many analysts at top firms hypothesize that its growth rate could outpace Chinas by 2013 (if not before). This speculation fails to take into account the factors that are intrinsic and deeply embedded into these economies, factors that have a key role in determining how and when growth and development takes place. As a result, it is highly misguided. Surely India has a long way to go before it can become as rich as China, which has an economy that is four times larger (The Economist). Two factors often brought up that tend to tilt the scale in Indias favor are demography and Indias much ridiculed bureaucracy. Making an in depth study and analysis of India vs. China economy seems to be a very hard task. Both India and China rank among the front runners of global economy and are among the world's most diverse nations. Both the countries were among the most ancient civilizations and their economies are influenced by a number of social, political, economic and other factors. However, if we try to properly understand the various economic and market trends and features of the two countries, we can make a comparison between Indian and Chinese economy. Going by the basic facts, the economy of China is more developed than that of India. While India is the 11th largest economy in terms of the exchange rates, China occupies the second position surpassing Japan. Compared to the estimated $1.3123 trillion GDP of India, China has an average GDP of around $4909.28 billion. In case of per capital GDP, India lags far behind China with just $1124 compared to $7,518 of the latter. To make a basic comparison of India and China Economy, we need to have an idea of the economic facts of the countries.

If we make the analysis of the India vs. China economy, we can see that there are a number of factors that has made China a better economy than India. First things first, India was under the colonial rule of the British for around 190 years. This drained the country's resources to a great extent and led to huge economic loss. On the other hand, there was no such instance of colonization in China. As such, from the very beginning, the country enjoyed a planned economic model which made it stronger.

AGRICULTURE
Agriculture is another factor of economic comparison of India and China. It forms a major economic sector in both the countries. However, the agricultural sector of China is more developed than that of India. Unlike India, where farmers still use the traditional and old methods of cultivation, the agricultural techniques used in China are very much developed. This leads to better quality and high yield of crops which can be exported.

IT/BPO
One of the sectors where Indi enjoys an upper hand over China is the IT/BPO industry. India's earnings from the BPO sector alone in 2010 is $49.7 billion while China earned $35.76 billion. Seven Indian cites are ranked as the world's top ten BPO's while only one city from China features

LIBERALIZATION OF THE MARKETS

In spite of being a Socialist country, China started towards the liberalization of its market economy much before India. This strengthened the economy to a great extent. On the other hand, India was a little slow in embracing globalization and open market economies. While India's liberalization policies started in the 1990s, China welcomed foreign direct investment and private investment in the mid 1980s. This made a significant change in its economy and the GDP