Comparative Study of India and China

FOR BRAZIL, Russia, India and China, the acronym is BRIC. Out of these four counties the last two ‘IC’- India and China - are in limelight in the eyes of worldwide investors. Chinese dailies are full of the news of huge market capitalisation of top five Chinese companies, one of which (Petro China) has created a world record by being first company of the world to have market capitalisation of over one trillion dollars. This article compares the two hot countries of Asia. Comparison of economies As per IMF (International Monetary Fund) Report, China was the fourth largest economy of the world by nominal GDP in 2006, whereas India was 12th. China registered GDP growth rate of 11.3 per cent in the first half of 2007, whereas India has registered a 9.3 per cent GDP growth in April-June 2007. Chinese economy is worth $ 3.1 trillion (that is, $ 3100 billion), whereas Indian economy is worth of $ 900 billion. China’s forex (foreign exchange) reserves exceed one trillion dollars (excess of $1000 billion) whereas India is having forex reserves in excess of $ 265 billion. Chinese largest company Petro China is having M-Cap (market capitalisation) of $ 1.6 trillion (as on November 5, 2007), whereas India’s largest company RIL (Reliance Industries Ltd) is having M-Cap of $ 96.02 billion (as on November 2, 2007). China boasts of having five out of 10 biggest companies of the world in terms of M-Cap, whereas India has not a single company listed in top 10 companies of the world in terms of M-cap. Interest rates comparison Nominal interest rate on loan and advances in China is 7.25 per cent, whereas it is 12.75-13.25 per cent in India. Real interest rate on loan and advances (interest rate minus inflation) in China works out to be 3.36 per cent in China, whereas it is 9.65-10.15 per cent in India. Deposit rates in China are in the range of 2.07-4.95 per cent, whereas it is in the range of 7.5-9.6 per cent in India. One-year yuan