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Comments on China or India: Difference in the Details
Beyond Taikonauts
A. Sheshabalaya, Financial Times
October 22, 2003

India's space programme … is clearly the world's only one with an ambitious agenda for empowerment and economic development. For example, India's eight IRS satellites today form the world's largest (and one of its most advanced) remote-sensing constellations. They are used not only to find water resources and combat deforestation at home, but also to monitor pollution and fight forest fires in Europe and the US….
Meanwhile, India plans to launch an entirely new generation of satellites over the next two years. These include three world firsts - satellites dedicated exclusively to telemedicine, education and disaster management.
Space odyssey and national development
November 17, 2004

Within India, scientists have used the satellite pictures to combat deforestation, monitor desertification, predict crop yields, and even trace the course of an underground river in northwest India that some scientists say could be used to irrigate the Thar desert in Rajasthan.

India has world's only education satellite
January 3, 2005

Launched in September last year, the country now has the world's only satellite dedicated to education. The so-named Edusat is geared to beam classes and lectures in a 'schools in the sky' project aimed at reaching 37 million schoolchildren in seven years….The Indian Space Research Organisation (ISRO) here that sees providing vital information to the poor as its main goal, consciously shunning the space race of superpowers.
Blue/Brown: India's and China's navies
A. Sheshabalaya, Financial Times
November 17, 2003

The recent Indo-Chinese military thaw … is not driven solely by India's concerns. One key fact overlooked by your writers is that the Indian flotilla is led by a "5,000 tonne Russian-built destroyer", rather than the newer and more potent 6,700 tonne Indian-built Delhi-class series which the Chinese would surely love to examine. Along with India's larger fleet of modern Kilo-class submarines and Krivak-class stealth frigates, India's blue-water naval capabilities have long been a source of serious concern to China, which, for example, still lacks an aircraft carrier. In 2000, an Indian naval battle group operated unhindered for months in the South China Sea, ostensibly to conduct anti-piracy exercises with the South Korean and Japanese navies…Your writers may thus be misreading the message by focusing entirely on New Delhi's concern "about China's growing naval reach".
China's pearl in Pakistan's waters
Asia Times
March 4, 2005

"Having no blue-water navy to speak of, China feels defenseless in the Persian Gulf against any hostile action to choke off its energy supplies," points out Tarique Niazi, a specialist in resource-based conflict, in the Jamestown Foundation's China Brief. A presence in Gwadar provides China with a "listening post" where it can "monitor US naval activity in the Persian Gulf, Indian activity in the Arabian Sea and future US-Indian maritime cooperation in the Indian Ocean."…

India starts flexing economic muscle
International Herald Tribune
May 12, 2005

Just three days earlier, India's defense minister, Pranab Mukherjee, had announced plans to build a $662 million aircraft carrier. It would be the first built by a developing country and, were it afloat today, would be the largest under the flag of any nation east of Europe and west of the United States, officials and analysts say. India is also retooling its military to project force more expansively. It has irked China by conducting naval exercises in the South China Sea.

The return of the pundits
A. Sheshabalaya, Rising Elephant
March 2004

As much as its consensual democracy, India's open market system stands out in stark contrast to China's, once again in terms of providing immunities against sudden surprises. Still, India's increasing engagement with the world is … anchored within a broader-based (and in the long-term, more durable) economic and business context. …Unlike China, India also has the advantages of a long-standing entrepreneurial culture; its stock exchanges are, for example, Asia's oldest.

It is now clear why India scrupulously ignored self-serving Little Brother platitudes from a galaxy of Western pundits in the 1980s and 1990s, to follow faithfully in the footsteps of southeast Asia's now-faded economic darlings. Instead, rather like Wal-Mart, it contributed a wholly-unique combination of volume and value, skills and scale, to commodify the New Economy. Accompanied by an equally systematic and strengthening assault on its higher-skill frontiers, India is showing that the broader Western advantage may not last forever....

Global Trends 2020
National Intelligence Council, US
January 2005

India has well-entrenched democratic institutions, making it somewhat less vulnerable to political instability, whereas China faces the continuous challenge of reconciling an increasingly urban and middle-class population with an essentially authoritarian political system.
India possesses working capital markets and world-class firms in some important high-tech sectors, which China has yet to achieve.

Which is Asia's real sleeping giant
The Age, Australia
January 31, 2006

It's scenes like these that have economists such as Stephen Roach at Morgan Stanley saying: "India is on the cusp of something big." As a share of gross domestic product, its burgeoning consumer sector is outpacing China, Europe and Japan. Economists are also noticing that India's economy is looking less like those in East Asia and more like those in the West.
For all its warts, India boasts a level of ground-up entrepreneurship China's top-down model can't match. It has created world-class, globally competitive companies and a real stock market, unlike the financial casinos that pass for equity bourses in China.
India also has a liquid bond market and its banking system isn't bogged down by bad loans.

India turns world's best FDI destination

Economic Times

May  19, 2006


India provides higher returns on foreign direct investment (FDI) than any other country in the world, Minister of State for Industry Ashwani Kumar told American investors here.

Speaking at a meeting organised Wednesday evening by the India-American Chamber of Commerce here, Kumar said India was poised for a massive expansion in manufacturing, infrastructure, automobiles and auto-components and food processing sectors, besides telecommunications. He urged investors to seize the opportunity for availing themselves of huge opportunities in these sectors.

"Foreign financial analysts have concluded that India provides maximum return on investments, more than even China," he told the meeting.

India's pull on high-value manufacturing
A. Sheshabalaya, Rising Elephant
March 2004

Like much else in the growingly-seamless world economy, there is no permanent breakwater point between manufacturing and services, blue- and white-collar, especially as both globalize.
With information technology an increasingly-integral part of manufacturing processes, India has also begun to pull the more-purely blue-collar parts of the global economic edifice towards itself, riding and drawing strength from its increased predominance in the higher value white-collar segment. Here again, India has an inherent lead over China, which will no doubt strive to do the same, but from the opposite, lower-value direction….
Siemens invests in Indian export hub
Financial Times
February 9, 2005

Siemens is to invest up to $500m over the next three years in India, which the German engineering group said was emerging as its main regional export hub….
Siemens' move, which was unveiled yesterday by Heinrich von Pierer, supervisory board chairman, in Mumbai, is the latest evidence of India's appeal, often at the expense of China, as a base for the manufacture of engineering products.
Last month, Swiss/Swedish rival ABB said it would expand its strong Indian manufacturing operations to meet rising demand for automation technology and control systems from customers….

Chinese paradox: A shallow pool of talent

International Herald Tribune

April 25, 2006


For headhunters like Li, competition like this is now commonplace as China's headlong economic growth outpaces the supply of qualified professionals and managers.

"It's become a very big problem," said Li, client partner at Corporate Resources International, a Beijing-based recruiting agency. "Just because people accept your offer doesn't mean they will join your company."...

And, while experts warn that shortages of cheap labor threaten the dominance of China's powerhouse manufacturing industries, the lack of qualified graduates could derail longer-term plans for a transition to producing higher-value goods and services.

India and China: IT Industries
A. Sheshabalaya, Rising Elephant
March 2004

For the sake of scale, it might be pertinent to note that the tenth largest Indian software company exported more than the entire country of China in 2002.Oracle's employees in India at the end of 2003 are estimated at 6,000; for the sake of comparison, apart from "100 engineers in Shenzhen", Oracle has approximately "300 workers handling day-to-day operations, sales and support in China."

China, India and developer futures
Computer Business Review
March 9, 2005

(Matt) Thompson (Sun's director of technology outreach and open source programs) said India is producing a "ton of very high quality architects" while China is "going to have a lot more low-level programmers."

Sun to double Indian R&D staff
May 9, 2005

(According to) Stephen Pelletier, senior vice-president of global engineering at Sun, "You can say Sun software products are all made in India."

India and China: Management Issues
A. Sheshabalaya, Rising Elephant
March 2004

Instead, (Indian IT firms) realized that long-term value and profits required investing - sometimes heavily - in the creation of adequate professional skills at the techno-managerial middle level, an area where a potential competitor like China is simply outclassed….One reason for this is India's lead over China in terms of middle and upper levels of professional management; among other things, even pre-reform India had managers running private companies (multinationals included), while a 55-year old manager in China in 2005 was unlikely to have had much of a career in his 20s, just after the Cultural Revolution.
Global giants headhunting in India
May 25, 2005

And running a multi-thousand (employee) company in China is a nightmare, while it is definitely possible in India, where Indian companies are already doing it."

Help Wanted
August 29, 2005

China "has too many factories and too few skilled managers, a talent gap that could trip up its runaway economy." The "managerial edge goes to India, with its charismatic globe-trotters."
Efficiency, Predictability and Stability
A. Sheshabalaya, Rising Elephant
March 2004

For those enraptured by the Middle Kingdom, Rising Elephant provides good reasons for caution, about both the content and longevity of the China Dream ….Though both India and China share similar demographic advantages, blurring the differences between the two Asian giants derails some of the finer points in the relocation debate. One of the most important issues here is that India's challenge to Western economic supremacy is focused on the white-collar services sector….
While China's seeming decisiveness, and its clearly more sophisticated perception management machine, has engendered a pro-Chinese constituency, especially in Europe, others... are less sure....
This, in turn, poses a question which is uncomfortable for some: what differentiates India's success from that of China? Is it, for example, 'better' that a totalitarian State like China succeeds in eliminating poverty more quickly than a free country like India? Is the former kind of success necessarily more durable, especially given the example of the massive resurgence of poverty after the failure of the manufactured miracle in southeast Asia - which may have parallels to China, as some experts argue?
Whose Asian Century?
Jim Hoagland, Washington Post
June 9, 2005

China prepares to head a great manufacturing empire. But empires unravel, usually from within. The forces that will determine which nations will dominate the 21st century may yet favor India's emerging reach for global power status more than China's determined grasp for that prize….The Middle Kingdom serves as a platform to bring together capital, cheap labor and industrial technology from throughout the region and ultimately the world. China relies on this empire, but does not totally control it. India, on the other hand, has set out to become "a global knowledge hub, with a central place in the transnational movement of knowledge and services."

China vs. India: A battle of ideas
International Herald Tribune
January 26, 2006

The effectiveness of the Chinese model is evident in its annual growth rate, which is near 10 percent, but its sustainability is questionable.
"For the next two decades, Indian society is predictable and the democratic framework predictable," said Yasukuni Enoki, the Japanese ambassador to India, in an interview. "How about China? Two decades? Really we cannot draw a predictable picture."

India flies, China falls to 'flawed' economy
February 27, 2006

China may be the destination for short-term investors, but if you are in it for the long haul you might want to bet on India, according to ... Clyde Prestowitz, President of the Economic Strategy Institute and a former counsellor to the Secretary of Commerce in the Reagan administration.
India and China: IT Industries (contd.)
A. Sheshabalaya, Rising Elephant
March 2004

Sheepishly (given its headline), the article concludes, "No big Chinese rivals for the multinational outsourcing firms have yet emerged." With "training and experience", continued the writer, "such obstacles are surmountable." One of the major sources for such training is in fact India's NIIT; by 2002, it already had a partnership with "six universities and three software technology parks" in China, and plans to grow this network to 500 centers by 2007….The Chinese themselves are keenly aware of such facts, especially given the kind of blue-chip customers brought to their country by TCS' Hangzhou center.
China feels Indian IT heat
Press Trust of India
December 6, 2005

With top Indian software giants like TCS, Infosys and Wipro setting up and expanding operations in China, the domestic players have started feeling the heat….In mid-2005, Tata Consultancy Services (TCS) and Microsoft were selected as partners to form a joint venture company in Beijing for it outsourcing services and solutions for global and domestic market. The venture is expected to come up in 2006….The Indian companies, with their advanced expertise and huge development teams, are formidable competitors for domestic firms, which usually have only hundreds of people on staff, the report noted. Says TCS: "The key objective of this global initiative is to build the new venture as a role model for the growing Chinese software industry."

India turns to the Middle Kingdom
Business Week
March 8, 2006

Once viewed primarily as a rival, China is now looking like a hotbed of growth opportunities for Indian tech companies.
India, China and the Third World
A. Sheshabalaya, Rising Elephant
March 2004

The answers are neither easy nor straightforward. Instead, they are enmeshed in a complex set of new equations focused on India and China, but especially India....
In a different direction, given the breakthrough social-technology paradigms being set there, India, as explained later, may very well be paving the way for a New New Third World Thing....
The Indian effort in using high-technology for potentially-sweeping results in mass empowerment, often on what are shoestring budgets, demolishes a clutch of pontificating 'either-or' cliches and carries lessons both for other developing countries as well as the West.
The India-versus-China question will remain intriguing for decades. Its outcome, however, will clearly have a major impact on the shape of the world economy.
'Beacon of light' for developing world': Shell
Press Trust of India
January 20, 2006

India and China will emerge as two economic powers that differ greatly economically and politically in the next two decades and New Delhi will become the "beacon of light for the developing world", according to a report (from Royal Dutch Shell).

The Indian Diaspora

A. Sheshabalaya, 

Rising Elephant
March 2004


The examples quoted above, however, remain shards from the iceberg's tip. Already by the 1990 Census in the US, the average household income of Indian-Americans "was about $60,000 - more than Japanese- or Chinese-Americans and considerably above the national average of about $39,000." By 1996, Indian-Americans had America's "highest median household income and highest proportion of college graduates, according to a Harvard study" . By all accounts, this lead strengthened further in the 1990s in the New Economy. In 1999, gushed 'Salon" magazine, "IIT has produced more millionaires (per capita) than any other undergraduate institution."...

Going further (territorially speaking), an American connection is also instrumental in the arrival of Indians at the top rungs of corporate Europe

India will outpace China in the long run

Daily Telegraph

April 23, 2006



India has perhaps the most materially successful diaspora anywhere. They are easily the highest achieving minority in both the US and the UK....They represent a massive resource of talent and investment available to help their mother country, dwarfing that of the exiled Chinese.

Britain's extensive cultural and historic links mean we are well-placed to take advantage of India's astonishing advance on its way to becoming perhaps the world's richest nation within my lifetime.


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