Understanding India: 'It's not another China . . .’
COMPARISON with China will get in the way of understanding the opportunities in India, warns a new report to the Australian Government . . .
TRANSFORMATION of the Indian economy now under way should generate annual growth of between six and eight per cent over the next two decades, according to a new Australian Government report.
The report urges Australian business not to put India in the "too hard" basket, but rather to seriously consider opportunities that will come from the Indian sub-continent.
"Over the next 20 years, no single market in the world will offer more growth opportunities than India," says Peter Varghese, author of the report. "India will be the world's fastest-growing economy. By 2025, it will overtake China in population and is forecast to become the world's third-largest economy by 2035, as measured by exchange rates."
Varghese says India will not be another China, and that it is a mistake to try to compare the two Asian giants. "India needs to be seen in its own terms," he says. "It has the scale of China, but it will not be another China. Indeed, comparison with China will get in the way of understanding the opportunities in India."
Varghese addressed a luncheon hosted by CEDA (the Committee for Economic Development of Australia) in Sydney to launch the report. A briefing followed in Melbourne.
He said the fundamental difference between India and China was that no Indian Government could ever direct the country's economy -- or control the allocation of resources.
"China has the discipline for economic planning that stems from its political system, and the competence of its State institutions," he said. "There is no counterpart of the Chinese system in India."