The world is flat when it comes to inflation. As oil exceeded US$139/barrel, in the last week, truckers across Asia and Europe protested. The strikes arrested transportation links that bring food to people, leaving many more in the lurch.

Exerpts from a Reuters report say - In Asia, governments are struggling to prevent rising prices making the burden on the public so heavy that it threatens political stability.

South Korea’s cabinet offered to resign in the face of huge street protests on Tuesday about the policies of its unpopular President Lee Myung-bak.

He said Asia’s fourth-largest economy could be heading into crisis because of surging resource prices and slowing growth. Producer price inflation in the world’s fifth-largest crude oil importer was near a 10-year high last month.

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Amongst the several thousands of victims of last weeks Sichuan earthquake are also many Indian medical students. The frightened students have been asking the university to help them return home and postpone their exams due in June.

The Indian embassy estimates that there are approximately 6,000  Indian students studying medicine in China. They come to China as a cheaper option to the U.S or U.K. due to the limited availability of seats in medical universities in India. With the medium of instruction in English, the deal is a win-win situation. Many students also say that the quality of medical educaton in China is ahead of India. Besides the privilege of living abroad, the students enjoy learning Chinese. A majority of the students goto medical universities in Tianjin or Hangzhou.

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After almost a year of negative growth, India’s textile and clothing industry’s exports to the U.S. grew by 8.26 percent in February this year, even as exports from China, the largest textile and clothing exporter to the U.S. (worth $32.3 billion or a third of US’ total T&C imports in 2007) slowed down registering a negative growth (-2.57%) in exports to the US in Jan-Feb 2008.

So what has led to this flux in the global T&C business?  it’s a repeat of history say analysts. In its evolution, the global textile industry has seen continual shifting of its base. As the economy grows beyond a level, it becomes unfit for the labour-intensive T&C sector. It happened earlier with Japan, and even earlier with the U.S. and EU .

Now, it’s China’s turn to cut its textile industry. And for other competitive textile producers like India, Vietnam and Indonesia, this is an opportunity. In India’s case, this is true for the next two decades at least (before it also finds textile production incompatible with the economy) reported The Economic Times.

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According to statistics issued yesterday by the Japanese External Trade Organisation (Jetro) http://www.jetro.go.jp/, the combined per capita income of ASEAN countries Burma, Brunei, Cambodia, India, Indonesia, Laos, Malaysia, Phillipines, Singapore, Thailand and Vietnam for 2007 was USD7,533, against just USD2,459 for China. This represents a rise from USD6,830 for 2006, an extraordinary increase for a diverse total population also larger than China’s at @1.6 billion people against 1.2 billion for the PRC.

This reflects the continuing growth rate and prosperity in the region, with major consequences for FDI throughout Asia. The regions diversity is also displayed, with tiny Brunei and Singapore leading the way in incomes, far beyond their Asian counterparts, over USD32,000 a head. At the opposite end of the scale however, Burma, Cambodia , Laos, Vietnam and India all recorded average per capita income of less than USD1000 per annum, although all showed significant growth rates as well. Of those closest to China’s level of GDP income, Thailand exceeded it and Indonesia was close behind China.

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For years, every summer young Indians and Chinese fly west to greener pastures in search of a more lucrative job. “India is no place to make money, earn your money abroad, then come back to India to retire,” was the advice I got from the older and wiser.

Now however, it seems the tables are turning, a lack of skilled employees, high attrition rates and a booming realty market means that Indian and Chinese salaries are registering double digit growth, - for 5 consecutive years now. Salaries in corporate India are set to rise at the fastest pace in the world this year. Salaries rose 15.1% last year, one of the highest in the world and the highest in the Asia-Pacific region - the sector doling out the most moolah was Realty, according to human resources consulting firm Hewitt Associates. Of the different strata in a company, junior management and professionals have recieved the highest rise.

Hewitt’s statitics for China show similar double digit growth. China’s highest salary jump was in 2006, when increments rose 7% to 9%in tier one cities such as Beijing, Shanghai and Guangzhou and and by 7.5% to 10.6% in tier two cities - Chengdu, Sichuan, Hangzhou and Zhejiang and Wuhan.

Will the rise in salary lead to India and China’s diminishing competitive advantage? or will it lead to a flood of reverse brain drain?

Recruiting the right talent is every becoming every HR manager’s nightmare. AS Asia faces a talent crunch in the face of growing competition, we find India might just emerge ahead of China.

A recent report by Mc Kinsey says that - India is not only producing more young professionals, it is producing better qualified ones, too. According to a survey of local recruiters, only 10 percent of China engineers have the skills necessary to work in a multinational corporation, compared to 25 percent of engineers in India. By 2008, India’s total pool of qualified graduates will be more than twice as large as China. If Indian universities continue to churn out top-notch talent, its younger, cheaper, and larger professional workforce could help India edge out its neighbor to the east.

Source: Mckinsey Global Institute

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…