Thursday, March 03, 2011

India may surpass China’s growth rate in 3-4 yrs: Basu

Buoyed by country’s robust growth prospects, Chief Economic Advisor Kaushik Basu today exuded confidence that India could clock a higher growth rate than China in the next three to four years.

“I think we (India and China) are very close in terms of growth rate now. Within the next 3—4 years, for us to overtake the growth rate of China is possible,” Mr. Basu said at a CII post—Budget conference here.

India economy is estimated to grow 8.6 per cent in the current fiscal and up to 9.25 per cent in 2011—12.

In the last three months of 2010, the domestic economy expanded 8.2 per cent while China grew 9.8 per cent during the same period.

Earlier this year, the World Bank projected that Indian economy would overtake that of China - on purchasing power parity (PPP) basis - by 2012.

According to Mr. Basu, it might take time before India could overtake China in terms of per capita income, especially since the neighbouring nation’s per capita income is three times more than India.

In 1978, the per capita income of both countries were the same, he added.

World Bank in its report had projected Indian economy to grow by 8.7 per cent in 2012, faster than 8.4 per cent expected for China.

However, these projections were based on PPP basis, which means that purchasing power of currencies are taken into account for measuring economic growth.

Currently, the size of Indian economy is USD 1.3 trillion while that of China is worth USD 5.5 trillion. Few weeks back, China also emerged as the world’s second largest economy, toppling Japan.


mohit mittal said...

Dear Pankaj
Firstly i want to say that I am extremely happy that you posted something on your blog after such a long gap. Because it really becomes difficult to start after a break. But since you have done it, I want to congratulate you and hope that this fire continues to burn in the coming years too.
Now talking about the article I must say that you have posted something which is very significant as far the world economy and politics is concerned. China has always been our rival. The intensity of this relationship has varied from time to time. But yes the coming years would definitely try to shape and reform this so called bond in every aspect possible. India is catching up. But still it has along way to go. You may call it my ignorance but seriously I have always doubted these statistics. Sometimes I think but fail. My question to you is what really determines the growth and development of a nation? Is there a single statistic or parameter available which truly defines the happiness of the people of a nation? Can these statistics answer their call and longing? I don't want to divert the topic but seriously want you to ponder upon this. These parameters may be important from the stand of a nation and world politics. But they also misguide and overreact some of the times. Your stand on this...awaited
Anyways lage raho.
Do post such articles and reviews in the future.
Do well.

Pankaj Aggarwal said...

Dear Mohit
thanks for your appreciation.. as far as this fire is concerned, well, credit goes to you brother. you, chachu and chachi have always been an inspiration to me. whenever i see you people i feel like motivated. you people are an inspirational boost to me.
now talking abt the article firstly thanks for your such a challenging question to me.. i dnt know whether i'd fulfill your expectations or not. well lets try..
If mathematical perspective is taken, growth and development index should rise and fall simultaneously. more the growth, more is the GDP and more is the income earned by the people of the country. I believe if it is measured in terms of money then it cannot be called as a sustainable development. it is rarely talked about how this growth is achieved. you can increase the income of the country by giving less wages or taxing heavily etc. Because money can buy you better health facilites but not sound health. it can buy you a piece of land but not a safe environment. it can provide you better education but not morals and ethics..because we, human beings, also have some irrational needs, for example, hunger for power..if one does not get it, it may result in war situations. then there comes a question of social equality. Economic growth can alone not provide you social equality...
Well mohit there is not any parameter which can define the happiness of the people. These scientists are very smart, they never discovered such an instrument which can measure the happiness of the people. Here comes your wording-HAPPINESS IS TOO MONOTONOUS TO CRAVE FOR, PAIN IS THE BEST ADDICTION. I really like it..
i think social development issues like providing human rights, providing liberal culture, improving health and education facilities, developing moral values and ethics, and environmental issues like availability of natural resources, forest development etc. should also be taken into account while determining the growth of the is wise to take facts, figures and ground reality to come to a conclusion but determining through this only is not wise..
Kofi Annan once said- A developed nation is one that allows all its citizens to enjoy free and a healthy life in a safe environment..

mohit mittal said...

Dear Pankaj
Thanx for such a detailed answer. You are quite right that scientists are very smart. They never devised such a parameter nor did they tried to do so. You really cannot measure it with parameters and plot it on a graph. It's a very personal thing and best left untouched by these brutal and unrealistic statistics.
Ya there comes the real Pankaj who believes that pain is addictive.
keep posting
keep the fire burning