India (Common wealth) _As per the latest reveal of a comparative study by brokerage firm Bernstein, India has a lot of catching up to do in terms of broad commercial and economic indicators, as it is already a median 16.5 years behind China according to the latest commercial Standards.
Bernstein calculated the India-China divide using a variety of yardsticks such as patents, foreign direct investment (FDI), forex reserves, nominal GDP, and exports.
According to the survey, India lags 21 years behind China in terms of patents. India is 20 years behind China in terms of FDI, 19 years behind in terms of currency reserves, and 17 years behind in terms of exports. India is 15 years behind in terms of nominal GDP and per capita income. It is 13 years behind in terms of consumption expenditure. It is 16 years behind in terms of gross fixed capital formation.
Bernstein’s study is based on data from the Reserve Bank of India (RBI), the National Bureau of Statistics of China, the Ministry of Statistics and Programme Implementation of China, the World Bank, and the World Intellectual Property Organization.
China’s superiority in these metrics is comprehensible given that India’s GDP was just the 11th largest in the world a decade ago, according to the newspaper. However, in recent years, India has surpassed China to become the world’s fifth largest economy.
Last year, India’s GDP of $3.53 trillion surpassed the United Kingdom’s GDP of $3.38 trillion to become the world’s fifth largest economy. These estimations were based on the International Monetary Fund’s estimates.
However, the New Indian media examined the nominal GDP figures, stating that the problem with GDP estimates is that they are subject to a series of revisions, with the final data arriving with a two to three-year lag. In other words, initial estimates of national output are rough estimates that are vulnerable to modifications both upward and downward.
It’s also worth noting that a country’s nominal GDP is expressed in terms of current-year prices for goods and services, whereas real GDP is inflation-adjusted GDP.
Another piece in the July issue of the Australian media examined GDP growth, stating, “All high-income countries get into low GDP growth orbit due to economic prosperity and falling population, whereas developing countries record higher GDP growth.” Unsurprisingly, India, a poor developing country, surpassed these four countries to become the fifth largest, despite a lackluster growth rate of roughly 7% in current dollars between 2013 and 2022.
However, India lags far behind in terms of per capita income, according to the publication. India intends to reach $10 trillion in GDP by 2030, a target that many believe is extremely attainable. According to Business Standard, India can benefit from China’s slower economy.
According to the World Bank, annual GDP growth would be only 3% in 2022, down from 8.4% in 2021. According to the business daily, India is expanding faster, at 7% in 2022, and it is expected to continue at that rate or higher.
The geopolitical tensions between the United States and China have given India new leverage – many global companies manufacturing in China are hedging their bets, and India has persuaded the likes of Apple to shift manufacturing capacity to the country and export a large portion of its production, it said.
According to Business Standard, India has a growing young workforce and lower labor expenses than China. However, China’s labor productivity is significantly higher.
In terms of production, India relies significantly on China for raw materials. And because of its ability to make products on a large scale, China has become the world’s manufacturing hub. And because it produces products on a large scale, it can sell them cheaply. It is able to dominate by selling them cheaply, according to Arun Kumar, retired professor of economics at Jawaharlal Nehru University, who spoke to the media recently.
Furthermore, despite a growing workforce, India lacks sufficient quality jobs. As a result, India’s population increase could become a burden if sufficient jobs are not created.
