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Economic Reforms in India and China: Emerging Issues and Challenges THE economic profile of India and China has generated a lot of interest since they are two of the top ten fastest-growing economies of the world. Though these two Asian giants have very different social, cultural and political context, there are many similarities in their approach. The book, which contains 19 contributions by distinguished scholars of India and China, examines and analyses the impact of economic reforms on different factors of growth like banking and institutions, agriculture, education, poverty, trade and WTO, FDI, etc.
The first section, Understanding Reforms, has a comparative in-depth analysis of the economic reforms being carried out in the two countries. The authors accept the differences in the ‘positional objectivity’ of the two nations and list only what they perceive to be striking similarities and sharp differences in their reform experiences. A chapter in this section examines the conventional wisdom that institutional changes and trade liberalisation are the two main factors for growth. It infers that it is the institutional quality that affects long run comparative advantage, which in turn helps trade take benefits of reforms. One of the chapters compares the system of higher education in India and China in the background of ‘marketisation’ and ‘privatisation’ as a consequence of globalisation. The authors argue that both the countries can greatly benefit by sharing their experiences related to education. Another chapter relates economic growth of the two nations with reduction in poverty. It discusses in great detail why the results are more impressive in China than in India. The second section, Fiscal Decentralisation, describes broad financial systems of India and China and various initiatives taken to reform the different systems and challenges they are facing. The third section, which is devoted to FDI, banking and institutions, explains FDI flows in India and China and draws comparisons. The financial sector in China is discussed in detail. The fourth section deals with agriculture, trade and WTO, and brings out the impact of reforms on agricultural trade between the two countries. The last section, Sectoral Studies, discusses inventions and patent laws, emerging challenges in pension policies and prospects of ancient medical systems in today’s world. The book brings together diverse uniqueness of India and China which have impact on their very challenging path to becoming economic powerhouses of great promise, only to be ranked behind the US. This compilation is an invaluable source of information for research by China observers, thinkers and military leadership and deserves a place in every library.
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The book is divided into
five sections. In Introduction, B. Sudhakara Reddy, professor
at the Indira Gandhi Institute of Development Research, Mumbai, brings
out various indicators of development and ‘why and how’ India and
China score against these factors. He makes certain interesting
observations such as "In India, PSUs are made out to be as
inefficient enterprises, which is not actually the case",
"Economic reform is a double-edged sword", "In the
private sector, both in relative and absolute terms, we notice a
growth of industrial sickness, more acute than the state owned
ones", "Economic liberalisation seems to have negligible
impact on the literacy levels", "It is interesting to note
that an overall acceleration in the growth rate of GDP in the economy
is not accompanied by a commensurate expansion of employment
opportunities" and so on.