Comparison between Chinese economy and Indian economy presents a very interesting picture. China, follows a dictatorial policy under a Communist system where as India, generally professes a liberal capitalist structure combined with some elements of mixed economy.
China used to have a very rigid and controlled economy with state participation in the economic development of the country. There public sector was the only system and every thing was state controlled. India, on the other hand introduced a ‘mixed economy’ system from the days of Jawaharlal Nehru. Under this method both the public and private sector take part in the economic activities of the nation and supplement each other.
China, in the recent past has realized that exclusive state control was not yielding the optimum result and some elements of incentives were required to be introduced in the system. At the same time it was noticed that the world economy, in general, was under going a thorough change and capitalism led by United States of America, Japan and other western countries were making rapid strides. China, in a way, was forced to remove some state control and introduced private participation in the economy. The disintegration of Soviet Union and collapse of communism in countries like Poland, Rumania and Czechoslovakia further expedited the process of reform in China. India too introduced a series of reformation from the days of Rajeev Gandhi and rapid changes were brought in the field of communication, computerization and other key sectors. The effects of such changes were soon reflected in the economy and telecommunication in particular, underwent a remarkable change. Even remotest villages too were connected by telephones and this facilitated the spread of information technology very quickly. This brought the vast country like India closer and helped in economic development management of the country.
However, in China substantial amount of government control still exists and they have introduced a compulsory ‘one family one child’ policy. This has brought an effective control in population growth. Where as, a relatively relaxed population policy is almost facing a situation of population explosion.
China used to have a very rigid and controlled economy with state participation in the economic development of the country. There public sector was the only system and every thing was state controlled. India, on the other hand introduced a ‘mixed economy’ system from the days of Jawaharlal Nehru. Under this method both the public and private sector take part in the economic activities of the nation and supplement each other.
China, in the recent past has realized that exclusive state control was not yielding the optimum result and some elements of incentives were required to be introduced in the system. At the same time it was noticed that the world economy, in general, was under going a thorough change and capitalism led by United States of America, Japan and other western countries were making rapid strides. China, in a way, was forced to remove some state control and introduced private participation in the economy. The disintegration of Soviet Union and collapse of communism in countries like Poland, Rumania and Czechoslovakia further expedited the process of reform in China. India too introduced a series of reformation from the days of Rajeev Gandhi and rapid changes were brought in the field of communication, computerization and other key sectors. The effects of such changes were soon reflected in the economy and telecommunication in particular, underwent a remarkable change. Even remotest villages too were connected by telephones and this facilitated the spread of information technology very quickly. This brought the vast country like India closer and helped in economic development management of the country.
However, in China substantial amount of government control still exists and they have introduced a compulsory ‘one family one child’ policy. This has brought an effective control in population growth. Where as, a relatively relaxed population policy is almost facing a situation of population explosion.