A compelling short essay by Hannah Rothschild raises concern about the impacts each distinct government - China and India - will have on their fortunes and on the world at large. 

INDIA and CHINA  

What impact will the two different styles of government of India and China have on their respective fortunes and on the global stage? 

by Hannah Rothschild, 2007 

We live in a global age where every great power interacts with and affects each other. At this moment we’re witnessing a great renaissance in Asia where the growing economic success of India and China is beginning to translate into political and military power.  One of the most fascinating aspects of this unfolding drama is how will these two very different styles of government, one democratic and the other a single party republic, will affect both domestic fortunes and foreign policy. (more…)

Like China’s India businesses, Indian businesses in China have to be critically strategic in their practice.  Unlike other MNCs in China, they focus for the most part on sourcing to fill the gap of domestic supply to feed the Indian market. Partha Swami covers a notable story of the success (and failures) of big and small fish Indian and Indo-Sino businesses in China’s wild-west’esque marketplace.  Have a look at Indians in China: Little Fish, Big Ambitions on the Knowledge @ Wharton web, www.knowledgeatwharton.com.cn//index.cfm?fa=viewArticle&Articleid=1460. 

Doing business in India has proven difficult for Chinese companies
due to a mix of business, cultural, regulatory, and strategic barriers but with persistence, lessons learned and huge efforts to ‘Indianize’, China’s India businesses are ambitious and have their eyes on becoming successful, the ‘Indian way’.  Read more insight on China’s businesses in India in Chinese Companies in India: Progress, But Still Some Roadblocks, by Partha Swami, Managing Editor at Business India magazine for Knowledge @ Wharton, http://www.knowledgeatwharton.com.cn//index.cfm?fa=viewArticle&Articleid=1461.

The World Bank recently released its ‘Doing Business in South Asia 2007′ report http://www.doingbusiness.org/southasia, ranking India the top reformer in the South Asia region.  The country’s efforts to carry out five major reforms in 2005-2006 (to simplify business registration, cross-border trade and payment of taxes, to ease access to credit and strengthen investor protection) makes it the best business destination in the region.  Hyderabad, Bangalore and Jaipur 3 of the 12 Indian cities covered by the report, are said to have the most business-friendly regulations, Mumbai and Kolkata ranked last due to the complexity in their business regulations.  It is said to now take only 35 days to register a business in Mumbai (71 days in early 2006, 89 days in 2004) and only 35 days to register property in Hyderabad (138 days in New Delhi, 155 days in Kolkata). Though the reforms helped make doing business in India much easier, the country is still low on the scale (ranked 134) and is 41 places behind China.  The author of the report, Ms. Caralee McLiesh believes that India could do much better and says that it could even “jump significantly in the global ‘Doing Business’ rankings, well ahead of other emerging markets like China”.  After the country expands the best practices in business which it has already adopted in some cities, it could surpass China and several other countries as one of the best destinations for doing business. 

The regional spread of foreign direct investment in China and in India shows profound contrast. China’s eastern seaboard has without a doubt received the bulk of foreign direct investment, political reforms and prosperity – leaving the interior provinces languished, left behind and largely untapped (but giving rise to a growing appetite of foreign businesses to go inland for operational cost advantage).  India on the other hand has spread its growing wealth across regions, creating widespread and diverse pockets of consumer culture (India’s population is youthful – 70% are under 36 years old and 20% of the world’s population under 24 years old are Indians - the youth are consumer frenzied, domestic demand – not exports – is said to be the real driver of India’s growth and the real incentive for foreign investment).  Let’s hear what you have to say about FDI regional spread comparisons between China and India, share your experiences, your thoughts, opinions, and questions…

I make a point of checking the ‘made-in’ labels on things before I buy them – t-shirts, shoes, coffee cups, electronics, bras… – China tags the grand majority, what about the India-made? While there are 250 million ready-to-work-in-your-factory Indians (living under a dollar a day), all the hype and FDI has been in hi-tech Bangalore, what about the foreign factories? Where are the ‘Made-in-India’ tags? Word has it that the structure of FDI in India is changing; India is the next best factory floor, a tougher competitor than China anticipated, what’s the deal?  Let’s hear what you have to say about India-made, share your practical India-manufacturing experiences, your thoughts, opinions, and questions…  

New Delhi, India - March 15,2007 - March 16,2007

Including meetings with Prime Minister Manmohan Singh, Mr. Kamal Nath, Minister of Commerce, and Mr. Montek Singh Ahluwalia, Deputy Chairman, India Planning Commission.