Tuesday, April 30, 2013

Busting the India vs China myth!

Comparing India with China, and looking to grab a few brownie points here and there, is a popular obsession with Indians in the past few years. But after Visiting China several times in the past and looking at how the Chinese have developed their economy and built world class brands, the entire debate only appears an exercise in futility

My visit to the Middle Kingdom over a decade back convinced me that New Delhi would not evolve into a Beijing if we worked round the clock for 25 years. When I revisited the capital city last year, I could see the accomplishment of 25 additional years of progress in ten years!

The reality of the unending Chinese miracle hit me harder when I looked at how Guangzhou has developed in just over the past decade. It seems we won’t even reach that level if we work round the clock for another 50 years. When I see how China developed Guangzhou as its industrial hub and how India developed Bangalore at its IT hub (both commenced their ascent at around the same time in the early 1990s) it appears to be a tale of two attitudes, rather than cities. By sheer numbers, the PricewaterhouseCoopers’ Global City Ranking Index for 2010 shows Guangzhou ranked at 44 with a GDP of $143 billion, while Bangalore is ranked much lower at 84 with a GDP of $69 billion.

For over much of the past decade and counting, the ‘India vs China’ debate has persisted across several levels. Both western and Indian media (for their individual reasons) have been particularly boisterous and over-the-top with this comparison on several grounds; and have picked up every possible opportunity to take it up. This was visible, for instance, when US Secretary of State Hillary Clinton came over for a visit and commented on how India should aspire for a parallel role in the region, or when it was being predicted by some economic reports that India’s GDP growth rate would outpace China by 2013-15. From my perspective, all that this debate can realistically provide is a generous daily dose of rollicking entertainment! India may have merited a comparison with China a decade and a half back, but we have crossed that bridge long ago. You may call this assertion unpatriotic, and it is quite obviously unpopular with Indian readers; but this is the plain truth.

Coming back to the two cities I talked about, there are many more surprises in store when you look further into the intricacies of Guangzhou’s numbers. Around 2.5 million women are working in the city, and the employment rate for women has surged three-folds to 70.84% in a decade. Life expectancy for women has risen by 4.5 years to 81.33 years and 49% of graduates are women, who are actively playing their role in sectors like science, technology and education. At around $17.8 billion (2010 figures), the city’s FDI figures are over six times that of Karnataka at around $2 billion (2008-09 data, of which Bangalore would presumably have a major share). The visionary Chinese specifically chose a port city to take advantage of sea trade. Also, the government strategically divided the city into multiple special economic zones to further attract foreign investment. For instance, The Guangzhou Economic & Technological Development Zone caters to technological manufacturing and also serves chemical, electric machinery, food, electronic equipment, metal fabrication and beverage industries. The Guangzhou Nansha Export Processing Zone is meant for automobiles, biotechnology and heavy industries. Easy access has been provided to Shenzhen Port and Baiyun airport to ensure fast movement of goods. The four auto companies in Guangzhou, who are in JVs with 50 major global auto companies, were on target for producing 1000000 cars by 2011. Bangalore, meanwhile, has insensibly avoided division of the city into special manufacturing hubs. Some areas like Inner Ring Road (where we have offices of major multinationals like IBM, Microsoft, Dell and Yahoo!) have become clustered zones for specific industries, but not by design. Also, there are no specialised trade zones in Bangalore, so synergy is hard to achieve.


Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri
 
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