Economic development of India and China Essay Example | Topics and Well Written Essays - 1750 words

Economic development of India and China - Essay Example In the case of China, there is consensus that, in the past three decades, the country’s leadership adopted policies aimed at accumulation of wealth for rapid industrialisation and export of industrial goods (Zhijun and Jing, 2011). Prior to 1979, the country’s national planning was a catastrophe. This led to poor showing on economic scales. In India’s case, poor economic performance in the 1960s throughout 1970s has been associated with several issues including poor policies, and license-permits (Kshetri, 2011). Yet India’s poor infrastructure and lack of demand also contributed to the country’s industrial growth. The two countries adopted policies aimed at addressing their challenges, which have effectively turned around their economies since 1980s. Overview of both economies On the key economic developments in recent times, China and India occupy the first and second positions in Asia respectively (Dong et al, 2013). The two nations are by their b ig population size, global economic powerhouses. Whereas they develop the industries, it is clear that their growth will have deep impacts, not just within the countries but for the better part of the global economy. Such impacts which are already on record include; new market opportunities, stemming from improved purchasing power and higher competitiveness of the two greatest economies in Asia known for particular industrial commodities (Zhou et al, 2010; Prime et al, 2012). China and India have had very rapid economic development which has led to significant achievements, especially on poverty reduction. The two countries also experience problems arising from rapid economic development such as the increasing gap between rural and urban income earners and pollution of the environment (Das, 2012). Afan (2013) indicated that increasing incomes trigger structural transformation in the agricultural sector and food industry as the economy encounters changes in demand and consumer prefer ences. Concomitantly the effects will impact on trade, business and investment. Both global economic giants have undergone positive growth in the agricultural sector, followed by fast-developing industrial sectors and a huge slump in relative poverty. Das (2012) pointed to the difference in the preconditions and the triggering economic factors behind growth in the two countries. Massive agricultural production Both China and India have massively invested in agriculture (Dorn, 2013). The Chinese economy manifests the significant impact of agriculture on the country’s economic mix, especially in the 1980s and 1990s, when major economic reform took effect in the country (Liu, Liu, and Wei, 2005). In India, the lesser industrialized power of the two, agricultural production continues to occupy a very important part of the economy. While agriculture's portion in the Gross Domestic Product (GDP) has been on a downward trend, the industry still provides massive employment opportunit ies for the locals (Agrawal, and Khan, 2011; Bensidoun, Lemoine, and Unal, 2009). Economic contribution in this sector is undeniably of tremendous significance for prospective policies and measures aimed at the realization of the Millennium Development Goals (MDGs). This is especially true for the need to alleviate abject poverty and food insecurity in the economy by 2015 (Winters, and Yusuf, 2007; Gupta, and Wang, 2009). Appropriate economic responses China’s and India’s economic growth can be attributed to the tactful manner in which they have responded to new global adjustments such as free trade, globalization, agricultural production, rural growth and poverty alleviation (Das, 2012). The two countries