Financial Post: India soon to surpass...

Financial Post: India soon to surpass CCP China, for good.

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Mirolyuba

Port Moody, Canada

#1 Dec 20, 2012
Why India is a better bet than China
Mamta Badkar, Business Insider | Dec 20, 2012 6:30 AM ET
More from Business Insider


Of the world’s big emerging markets, China is widely seen as the most significant and reliable engine for growth, even despite its recent slowdown.

Meanwhile, India has been a disappointment with its infrastructure problems and notoriously slow bureaucracy.

But legendary economist Gary Shilling tells us not to write India off just yet.

Related
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Desperate For Business, Iran Heads To India

In the latest edition of his must-read newsletter Insights, Shilling makes a brilliant bullish case for India.

“In the long run, India has many advantages for economic development, especially compared to China, thanks in part to the systems and traditions left over from British colonial rule,” wrote Shilling.

Of course, he warns that India faces many setbacks on this path and needs to implement reforms, improve education and infrastructure, speed up urbanization.

But India has the foundation in place to eclipse China.

...
Mirolyuba

Port Moody, Canada

#2 Dec 20, 2012
...
India has no limits on population growth

As of 2011, India had a population of 1.24 billion, compared with 1.34 billion in China. And with China’s one-child policy, India’s population is set to overtake China’s.

Moreover, the age distribution in both countries is very different. The dependency ratio i.e. the ratio of children and seniors to the working-age population is expected to continue to fall in India and rise in China. Of course this would only translate into more productivity if the population got education, job training, and job opportunities.

Source: A Gary Shilling’s Insight

India’s demographic mix will continue to be much more favorable than China’s

A. Gary Shilling

India has historically had more free market orientation than China

Lee Warren/Gallo Images/Getty Images

In the years following independence, Indian politics were dominated by the Congress party which tried to emulate the Soviet Union, nationalizing many industries in the 50s and causing foreign investment to decline. But starting 1991, the country shifted towards liberalization and capitalism.

“Nevertheless, India has historically had a much more free market orientation than some other large developing countries, notably Russia and China.” State controlled companies account for 14 percent of GDP in India, compared with 50 percent in China.

...
Mirolyuba

Port Moody, Canada

#3 Dec 20, 2012
...
“India also has a number of large and sophisticated companies such as the Tata complex that can compete globally. In contrast, China is burdened with government-controlled banks and other hugely-inefficient state-owned enterprises that still produce 50% of GDP and employ a quarter of the workforce.”

Source: A Gary Shilling’s Insight

India’s currency market is more open than China’s

School students make a formation depicting the new symbol of the Indian Rupee in Chennai

AP Images

China is expected to make the yuan fully convertible by 2015, but Gary Shilling points out that it is still tightly controlled, and while it is allowed to appreciate when the market is good it s held stable when it isn’t.

Despite its weakness, the Indian rupee has been “relatively free of government interventions”. The recent central bank intervention has “fallen within the Reserve Bank of India’s stated policy of intervening only to address severe market dislocations and foreign exchange liquidity shortages”. Policymakers have also liberalized capital flows and allowed foreigners to invest in equities.

Source: A Gary Shilling’s Insight

And its central bank is independent of government influence

Wikimedia Commons

India’s central bank is relatively independent of the government while in China we recently saw governor Zhou Xiaochuan get muscled off the Communist Party’s central committee.“Politicians, not central bankers, call the shots in China.”

...
Mirolyuba

Port Moody, Canada

#4 Dec 20, 2012
...
In China,“interest rates are kept artificially low (Chart 15) to provide cheap loans to inefficient state-owned enterprises that account for half of GDP and employ a quarter of the workforce. Consequently, Chinese monetary policy is run mainly by reserve requirements, a crude tool long ago shelved by the Fed and other major central banks since it amounts to credit allocation.”

Source: A Gary Shilling’s Insight

In India, consumer spending already accounts for 58.0 percent of GDP

Deutsche Bank

Whereas in China consumer spending accounts for just 37.7 percent of GDP

A. Gary Shilling

India’s exports are less volatile because they consist largely of services, whereas China’s exports are more exposed to manufactured goods which are cyclical

A. Gary Shilling

India has a high savings rate, but it hasn’t slowed domestic consumption

A. Gary Shilling

China has a similar savings rate, but consumers are less willing to spend because of limited social safety nets

A. Gary Shilling

India has the English language, free press, and legal system inherited from the UK

Wikimedia Commons

“The British gave India the English language very useful in today’s English-dominated world and a hugely unifying force in a country with hundreds of languages and dialects.”
“India also inherited her legal system from the U.K., very different than the Communist party-dominated courts in China, complete with show trials and forgone convictions.”
Source: A Gary Shilling’s Insight
Mirolyuba

Port Moody, Canada

#5 Dec 20, 2012
Excellent argument, well-supported and based on facts!
CHINA HUMILIATED by CCP

Port Moody, Canada

#6 Dec 20, 2012
What is THAT in India's DUST?

Ah! It's CHINA still suffering under a corrupt and obsolete dictatorship!

So sad!
CHINA HUMILIATED by CCP

Surrey, Canada

#7 Dec 20, 2012
Ah, but don't worry! Indian entrepreneurs will open factories in CCP China after the regime collapses, and other democracies will send FOOD AID to feed the millions once again starving there due to Chinese Communist Party mismanagement and incompetence!
lct

Beijing, China

#8 Dec 20, 2012
Mirolyuba wrote:
...
“India also has a number of large and sophisticated companies such as the Tata complex that can compete globally. In contrast, China is burdened with government-controlled banks and other hugely-inefficient state-owned enterprises that still produce 50% of GDP and employ a quarter of the workforce.”
...

produce 50% of GDP but employ a quarter of work force? how efficient !
AZN

Toronto, Canada

#10 Dec 20, 2012
CHINA HUMILIATED by CCP wrote:
Ah, but don't worry! Indian entrepreneurs will open factories in CCP China after the regime collapses, and other democracies will send FOOD AID to feed the millions once again starving there due to Chinese Communist Party mismanagement and incompetence!
They should build toilets in india first.
CHINA HUMILIATED by CCP

Port Moody, Canada

#11 Dec 21, 2012
lct wrote:
<quoted text>
produce 50% of GDP but employ a quarter of work force? how efficient !
"hugely-inefficient state-owned enterprises" it says, so CCP spin monkeys say the opposite?

I guess you CCP are just stupid.
CHINA HUMILIATED by CCP

Port Moody, Canada

#12 Dec 21, 2012
AZN wrote:
<quoted text>They should build toilets in india first.
Then CCP China should follow India's lead, as you say, and build toilets.

As you know, only 20% of Chinese have a flush toilet, the rest go on the ground or a hole in the floor.
AZN

Toronto, Canada

#13 Dec 21, 2012
CHINA HUMILIATED by CCP wrote:
<quoted text>
Then CCP China should follow India's lead, as you say, and build toilets.
As you know, only 20% of Chinese have a flush toilet, the rest go on the ground or a hole in the floor.
Only 2% have toilet in india.

All others do it on the streets, rail tracks or in any other space.
Snowflake

San Francisco, CA

#14 Dec 21, 2012
We told u that Miro is an Indian and he his sidekick Drgunzet is a VC who at times tried to act like an Indian.
blitz123

Chennai, India

#16 Dec 21, 2012
AZN wrote:
<quoted text>They should build toilets in india first.
build toilets in china u mean
india has already started building 2000 modern public toilets each in every city and town
blitz123

Chennai, India

#17 Dec 21, 2012
AZN wrote:
<quoted text>Only 2% have toilet in india.
All others do it on the streets, rail tracks or in any other space.
who r u kidding,thts 55%
CHINA HUMILIATED by CCP

Surrey, Canada

#18 Dec 21, 2012
AZN wrote:
<quoted text>Only 2% have toilet in india.
All others do it on the streets, rail tracks or in any other space.
The Cadres of the Chinese Communist Party do it on the people of China.
AZN

Toronto, Canada

#19 Dec 22, 2012
blitz123 wrote:
<quoted text>
build toilets in china u mean
india has already started building 2000 modern public toilets each in every city and town
blitz123 wrote:
<quoted text>
who r u kidding,thts 55%
Are these proof of your claims?

http://snitchingindians.blogspot.ca/

http://robertlindsay.wordpress.com/2010/06/29...
AZN

Toronto, Canada

#20 Dec 22, 2012
CHINA HUMILIATED by CCP wrote:
<quoted text>
The Cadres of the Chinese Communist Party do it on the people of China.
And the shit is wiped off you.
RayH

Shenzhen, China

#22 Dec 23, 2012
Mirolyuba wrote:
Why India is a better bet than China
Mamta Badkar, Business Insider | Dec 20, 2012 6:30 AM ET
More from Business Insider
Of the world’s big emerging markets, China is widely seen as the most significant and reliable engine for growth, even despite its recent slowdown.
Meanwhile, India has been a disappointment with its infrastructure problems and notoriously slow bureaucracy.
But legendary economist Gary Shilling tells us not to write India off just yet.
Related
Why China May Be Facing A US-Style Credit Crunch
Desperate For Business, Iran Heads To India
In the latest edition of his must-read newsletter Insights, Shilling makes a brilliant bullish case for India.
“In the long run, India has many advantages for economic development, especially compared to China, thanks in part to the systems and traditions left over from British colonial rule,” wrote Shilling.
Of course, he warns that India faces many setbacks on this path and needs to implement reforms, improve education and infrastructure, speed up urbanization.
But India has the foundation in place to eclipse China.
...
Meanwhile, the U.K. is in its downward spiral.
CHINA HUMILIATED by CCP

Surrey, Canada

#24 Dec 24, 2012
The Cadres of the Chinese Communist Party do it on the people of China.

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