In terms of major business and economic metrics, India stands 16.5 years behind China on average
According to the latest data by brokerage firm Bernstein, India is a median 16.5 years behind China on broad business and economic indicators.
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Bernstein calculated the India-China divide using a variety of yardsticks such as patents, foreign direct investment (FDI), forex reserves, nominal GDP, and exports.
On several parameters, India is behind China
According to the survey, India lags 21 years behind China in terms of patents. The country is 20 years behind China in terms of FDI, and 19 years behind in terms of currency reserves. Also, it is 17 years behind from china in terms of exports.
When it comes to nominal GDP and per capita income, India is 15 years behind from china. It is 13 years behind in terms of consumption expenditure. Also, 16 years behind in terms of gross fixed capital formation. As a result, it has a lot of catching up to do, according to the report published by the newspaper.
The Reserve Bank of India (RBI), China's National Bureau of Statistics, the Ministry of Statistics and Programme Implementation, the World Bank, and the World Intellectual Property Organisation provided the data used in Bernstein's research.
Given that India's GDP was just the 11th largest in the world a decade ago, it is comprehensible why China has outperformed India in these metrics, according to the newspaper.
India rose to the 5th largest Economy
India, however, rose to the fifth-largest economy in recent years. India overtook the UK to claim the fifth-largest economy in 2017 with a GDP of $3.53 trillion, surpassing that country's $3.38 trillion. The figures assessed by the International Monetary Fund served as the foundation for these computations.
However, the New Indian Express, examined the nominal GDP figures and noted that the problem with GDP figures is that they go through several revisions and the final data is only released after a two- to three-year lag. In other words, initial projections of national output are approximations that are subject to both upward and downward revisions.
Real GDP shows true picture of the Economy
It's also critical to remember that real GDP is a country's GDP adjusted for inflation, whereas nominal GDP is defined in terms of current-year prices of goods and services.
India’s goal to reach $10 trillion by 2030
India hopes to reach $10 trillion by 2030, which analysts agree is a highly realistic goal. According to Business Standard, India can benefit from the slowing of Chinese growth.
The World Bank states, annual GDP growth was only 3% in 2022 as opposed to 8.4% in 2021. According to the business daily, India is expanding faster than other countries in 2022, at a rate of 7%. It is anticipated that this rate of growth would continue, if not increase.
Organisations shifting their manufacturing from China to India
Due to the geopolitical tensions between the US and China, many multinational corporations that manufacture in China are hedging their bets. As a result, India has been able to convince companies like Apple to relocate their manufacturing operations to India and export a sizable portion of their output, the report said.
China has a higher labour productivity than India.
India, according to Business Standard, has a young, expanding working force with cheaper wage costs than China. However, China has much higher output per worker.
Moreover, India lacks sufficient high-quality jobs despite having a growing labour force. India's population expansion hence can become a problem if the country doesn't generate enough jobs.
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