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Tuesday, September 05, 2006

China's Advantages Over India

Recently some western and Indian medias are boasting about Indian's deveolopement by comparing with China simply for political reasons. Can that be true? Let me tell you some advantages China enjoys:

The biggest advantage China has is the basic education. more than 98% of Chinese are literate. That's one of the best performance among the developing countries. Labor force with education and skills is what really lures foreign companies to China and push Chinese economy ahead.

The second adavantage China has is the compelete industrial system. China's industrial revenue passed the agri-revenue in early 1970s. Industrial GDP in China is about $1 trillion, and it is still growing fast (annual growth rate has been more than 16% in recent years). US's industrial revenue is about 25% of its GDP, that translates its industrial GDP is about $3 trillion. By this comparing, you will realize the size of Chinese industry. India's industrial GDP is less than $200 billion. China can provide almost all parts and components for any products today except few top end ones. No other developing countries can match this.

The third advantage Chinese have is the vision into future. China invested a lot into technology R&D. Before the reform, 2.7% of GDP in R&D was poured into R&D even we were so poor (People's living was poor but the country was growing fast), that's why we had done so many things in that short time. China had almost no industry left in 1949 after the long time wars, but China could make large jets, nulclear submarines in late 1970s. That was a huge leap in a short time and had huge impact in China today's economy. China now is allocating more more resources in R&D. China today is among the leading countries in telecommunication tech, enginering, biotech, nanotech, superconductor tech.... Few other developing countries can match China in R&D.

The fourth advantage China has is the stability. China has many problems as a huge developing countries without any doubt. But China has been stable in past amost 60 years and will only be better with the economical progress and openness of Chinese society. At least there is no guerilla wars or Naxalites's wars inside China; Chinese have enough food and enough nutrition; people don't need to live in simple slums that are simply made of sticks and plastics.

The fifth advantage China has is a nation being united. Minorities are take care of and assited by government and people of other ethnical groups. We don't have any large scale conflicts between different athnic groups that can kill thousand people in a short period and we don't worry about the violent bombing that can kill hundreds in one day.

The sixth advantage China has is the good relationships with countries all around around the world, let alone our neighbours. We are not a main target of so-called terrorists.

The seventh advatage China has is the health care of her residents. Even we are criticizing our health system, Chinese average lifespan is higher than many other developing countries. Even we are criticizing our goverment the AIDS issue and western medias exaggerate the problem, we have only 0.64 million people infected even we have the largest population, much less than the No. 1 AIDS nation in the world. Chinese never complain about the shortages of medcines or vaccines for known diseases since we can make or the government has the resources to buy from others countries.

The eighth advantage China has is the good infrastructure for agriculture. China's irriagtion system we built before the reform covers more than 75% of our arable land. We don's count on the monsoon for our food and economy any more. Weather can cause damage or benefit to our economy, but its impact on our economy is so small.

The nineth advantage China has is the huge market. The largest commodity buyer in the world, The largest IC market in the world, The largest telecommunication market in the world, the second largest PC market in the world, the second largest auto market in the world. Need I list more?

The tenth advantage China has is that China's economy is balanced. We have balanced agriculture, industry and service sectors.

The eleventh advantages China has is the nice infrastructure. We are building expressway like crazy and we began to build our huge nationwide express railroad system. Urban residents get waters from their private taps. We don't depend on public taps or trucks for water supply. China has the second largest electricity generation capacity (more than 5 trilion KW at the end of 2005) in the world, but we are still adding 0.7 trillion KW capacity each year in recent years. The infrastructure achievement bolsters our economy and improves our living standards.

The twelfth advantage China has is that the strong self-dependence sentiment. We welcome investment and market in the outside, but we always count on ourselves.

The thirteenth advantage China has is that China is intergrated with outside. We bought more than US$600 billion products from other economies and we sold even more to others in 2005. We are confident in our industrial competitiveness and we don't need high custom tariff to protect our companies. 109 million tourists visited mainland China from outside in 2004 and more than 33 million mainland Chinese traveled to other places in 2005.

The fourteenth advantage China has is the low cost, but good quality products that are competitive in the international market. Low cost does not mean low wages only. Low cost means skilled labors who have education. Low cost means material convenience, China is the largest iron & steel producer, the largest cement producer and China is one of the largest oil and gas producer. Low cost means availability of industrial parts and components, you can find bolts and you can also find IC chips in China. Low cost means the nice infrastructure that can move resources, parts and components, and your final products around the world efficiently.

The fiftheenth advantage China has is that we speak our own Chinese. With the economy development, more and more internationals are studying Chinese. That's a big business opportunity for us. Around 150,000 international friends are studying in China already. A lot of Chinese schools exist in other countries. Chinese language is getting hotter and hotter. Also, Chinese can make software in English, Japanese, Korea (of cource Chinese too), but few others know how to make Chinese software.

The sixteenth advantage is China's openness. We not only open our market, but we open to the people from other countries. 300,000 S Koreans are living in China even they are richer than us. Hundreds of thousands internationals are working in China.

The seventeenth advantage China has is our people are disciplined. We Chinese always walk the talk. We know boasting can do nothing good to ourselves.

The eighteenth advantage China has is our economy is always growing fast. Chinese economy grew at more than 7% annually in average before the reform even China was under embargo and had to put a lot of resources in building our national security. China's economy has been growing at more than 9% in average since the reform.

The nineteenth advantage China has is we have plenty of labor force. Chinese lifespan is almost 10 years longer than India. Chinese can work longer. Chinese women were liberated and most of them entered job market. 98% of literate rate in China is much higher than around 60% in India. That's why China's labour force is always much larger than India. China has 1.3 billion population, India has 1.1 billion. But China has 791.4 million labor force while India only has 496.4 million according to CIA's factbook. No matter how many people you have, if your country cannot provide enough food, enough nutrition, enough education, and more important, enough jobs. The more population can only means more burden for a society.

The twentyth advantage China has is that all of our Chinese are equal. There are no untouchables in China and we don't have caste system existing. The only difference amony Chinese are wealth, jobs and education. But people can make difference if you work hard and learn hard or do your business wisely.

Need I list more advantages about China?

China today is tired of talking about the ownerships of cell phones, TVs, air conditioners or other home appliances even we are still a very huge market and manufacturer. We are talking about buying computers (more than 20 million PCs were sold in China last year, the second only after US) and cars (China's auto market is only after US in numbers in the world), digital cameras and other tech fashions.

China today is tired of talking about expressways even we are still building a lot, we are talking about and building express railways.

China today is tired of talking about the numbers of FDI, we are talking about how to use and manage the huge money we saved in the past. China's forex reserve will pass $1 trillion this year. $1 trillion is not small money, right?

China is tired of talking about the number of dial-up internet users, we are talking about broadband. China will be the largest broadband market in the next year in a recent survey by an international consultant company(we don't talk too much about uncertain long long future).

China is tired of talking about economical growth rate even our economy is running ahead at more than 10%, we are talking more about the quality.

China is tired of talking about food and other basic necessaries for living, we are talking about tourism (33 million visited outside of mainland China last year), fashions, decoration of living spaces.

When western medias and companies talk loudly about problems of China's banks, international investors flooded into stock market to buy the shares of China's banks when they were IPOed in Hongkong market. They value Chinese banks. Those Chinese banks are huge too.

When western medias and companies talk loudly about problems of Chinese state-owned companies, Chinese companies' stocks worth $600 billion in Hongkong market alone. They value Chinese state-owned companies.

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5 Comments:

Anonymous Anonymous said...

Lets see in 20 years.

8:57 PM  
Anonymous Anonymous said...

So much for the exclusive praise made for China....the author is taking such parameters into account which hold no truth and hold very little weightage.

Its a joke to see preaching on how China takes care of its minority....Xinjiang, Xizang...and Inner Mongolia...

Other listed advantages even hold no value and very little weightage. But its good if the Chinese continue to soar so high...coz'' after a certain point they can just come down and not go up any more....

2:31 AM  
Blogger Balaji said...

Some of the advantages you missed.

You can issue a diktat to all media to cover only the shining buildings of Shanghai and nothing of say, Inner Mongolia. You can effectively copy every single machine part & business process and get away with it. You can effectively put away every citizen who is rebelling, every family that is being destroyed by its economy, and still have no fingers pointing at you...

The one millionth advantage is that China is a total autarchy, where you have no mechanisms to check whether any of the previous advantages even exist.

6:54 PM  
Blogger Balaji said...

While Chinese should definitely be tired of getting compared to India, we Indias are also getting tired of getting compared to China. At some point this has to stop.

While China definitely have a upper hand now, we feel our basics are far sounder. It takes probabably ten years to build good infrastructure (like how we did for IT & Telecom infrastructure), but probably centuries to learn what is democracy. While it takes only a few years to copy & replicate a Manufacturing item with foreign investments, it takes decades to build a purely entrepreneurial & originality based system.

While in International media we keep hearing a lot of Indian entrepreneurship driven entities like Tata, Reliance, Infosys, Wipro, Bharti, I'm yet to see any entrepreneurial driven original company except for Lenovo. Am I missing something?

India and China are basically different and unfortunately put together in the same basket. Each have their own advantages and each of its citizens feel proud of their nations and each can learn from its neighbor. Simply putting one country over the other is stupid.

7:06 PM  
Anonymous Anonymous said...

I think that comparing CHina and India is wrong because of their different backgrounds, but more because of their different government styles. As we saw in the Soviet Union a while ago, teh centralization and absolute communist control was the basic running factor where all efforts were put towards making the country succeed(like China in its fairly strong rule) whereas India, a democracy, lets it economy be run by its people, so it goals are bound to be reached later, but, as one article points out, allows steam to be released along the way because of its more agreeable democratic environment.

8:53 PM  

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