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2point6billion.com discusses business and investment news rising from the geopolitical relations of China and India, and the interactions these two countries have with the rest of emerging Asia.



Monthly Archives: March 2008

Is India’s Auto Sector More Advanced Than China’s?

Purchasing entire companies rather than JV’s and buying used production lines signals a more mature approach

By Chris Devonshire-Ellis in Mumbai

Last weeks heralded purchase of the Land Rover and Jaguar marquees by India’s Tata Group from Ford for USD2.3 billion represents a major shift in the way Indian companies are able to obtain technological growth, in a manner that possibly outstrips the latent capabilities of China’s auto sector.

Although the deal, it has raised eyebrows internationally considering that premium global brands are being purchased by a country usually associated with cheap products, signifies different approaches to modernization between India and China, and may well prove to be a turning point when considering the future development of both nations. There are some fundamental differences in the way in which China’s auto manufacturers have chosen international partners, and have the capability to compete globally when compared to their Indian counterparts. Continue reading

Posted in Foreign Trade | 1 Comment

No. of engineers graduating/year (,000)

Numbers: (351,112)

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Managing the Mekong

mekong-river-map-320x.jpgCountries on the banks of the greater Mekong river – Cambodia, the People’s Republic of China, Lao People’s Democratic Republic, Myanmar, Thailand, and Vietnam, which have been experiencing growth rates of 7 percent or more in the past decade came together over the weekend in Laos, to discuss strenghtening trade and investment ties in the region.

The subregion’s economic performance was driven in part by increased trade, resulting from the transition to market-based systems and closer integration with external markets.

The greater Mekong subregion (GMS) countries met to discuss ways and means to increase intra-regional trade. On Monday, Xinhua reported that over the last few years, trade has expanded both within and outside the subregion. Over the period 1994-2006, intra-GMS exports, excluding to China, grew at an annual average rate of 19 percent, while exports to other countries increased at an annual average rate of 11 percent.

Regional cooperation within the GMS framework has seen advances in transportation, telecommunications, trade, tourism, and agriculture.

Continue reading

Posted in Foreign Trade | 1 Comment

Of melting mountains, drying rivers and starving stomachs

Melting Himalayan glaciers which perennially feed the Ganges and Yangtze, India and China’s main rivers, may soon dry up in summer, leading to drastic food shortages at a time when prices and populations are growing unanimously. China and India are the world’s leading producers of both wheat and rice, humanity’s food staples. In the Ganges, the Yellow River and the Yangtze River basins, where irrigated agriculture depends heavily on rivers, this loss of dry-season flow will shrink harvests.

“In a world where grain prices have recently climbed to record highs, with no relief in sight, any disruption of the wheat or rice harvests due to water shortages in these two leading grain producers will greatly affect not only people living there but consumers everywhere,” the Times of India quoted Lester Brown, President of the Earth Policy Institute as saying.

praying-in-the-ganges.jpgAn Intergovernmental Panel on Climate Change says that Himalayan glaciers are receding rapidly and that many could melt entirely by 2035. If the giant Gangotri Glacier that supplies 70 percent of the Ganges flow during the dry season disappears, it warned, the Ganges could become a seasonal river, flowing during the rainy season but not during the summer dry season when irrigation water needs are greatest.

Moreover, Brown said, in both of these countries, food prices will likely rise and grain consumption per person can be expected to fall. In India, where just over 40 per cent of all children under five years of age are underweight and undernourished, “hunger will intensify and child mortality will likely climb.”

The Ganga is the largest source of surface water irrigation in India and the leading source of water for the 407 million people living in the Gangetic Basin, a population larger than any other single country other than China. The Yellow River and Yangtze basin hold a similar position in China.

Continue reading

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Managing India’s Growth Rather Than Planning It. Getting 200 Million More People Employed in the Industrial Sector

Kamal Nath, India’s Minister of Commerce provides his comments on how to maintain India’s growth and what lies ahead.

The full interview with Chris Devonshire-Ellis, Senior Partner, Dezan Shira & Associates in Delhi

Kamal Nath is the third of the big three of Indian foreign politics, after Dr. Manmohan Singh, the Prime Minister, the Minister of Finance, Mr. Chidambaram, who we interviewed yesterday, and Kamal Nath, the charismatic and globe trotting Minister of Commerce. Together, these men represent the unified force of a resurgent India, united in views and passion for the country, and amongst the most recognizable Indian politicians around the world, these are globe trotting reformists, determined to battle the negativity of coalition politics and underpin India’s long awaited position at the high table of world trade. In this frank discussion, Mr. Nath touched on many issues, but especially the desire to get government out of the way and allow the private sector to flourish.

Continue reading

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2008 projected IT-services market ($ billion)

Numbers: (10.9,4.86)

Posted in The Comparator | Comments Off on 2008 projected IT-services market ($ billion)

Does India Have Built In Resilience Over US Downturn Concerns?

India’s Finance Minister lays down his reasoning India will escape a US recession, plus comments of Indian Government Corruption.

The full interview with Chris Devonshire-Ellis, Senior Partner, Dezan Shira & Associates in Delhi

Meeting with India’s Finance Minister, Mr. P. Chidambaram, is always a lesson in elocution and delivery. One year ago, when we last met him in our annual series of meetings with Indian Ministers in Delhi, he was shy, somewhat reserved, yet bullish. India was doing well, with growth rates at a consistent level of between 7-9% looking sustainable, and the Prime Minister, Dr. Manmohan Singh, stating to us that as long as India could keep such growth rates, it could afford it’s massive redevelopment, infrastructure and rural expenditure needed to lift the country into a true democracy with all people able to share in it’s wealth. “As long as those rates are sustainable” both the PM and Mr. Chidambaram chorused, “India’s continued development is assumed”.

Just a year on, we are faced with a different set of issues that could impact upon the Indian, and quite possibly, other emerging market economies, especially that of China. The US sub-prime crisis has dried up liquidity and seen money vanish. The US dollar is approaching record lows. The price of gas has just exceeded USD100 a barrel, respected international financial institutions are going bankrupt, and the prices of commodities in foods and metals have doubled and tripled. A year on, it’s not just a matter of India bullishness. A large blot has appeared on the landscape.

Sitting down with Mr. Chidambaram we had just one question to ask in our hour long discussion: “Can India escape a potential US recession ?”

Continue reading

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