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The integration of China and India into the world economy: A comparison

June 2009
The European Journal of Comparative Economics 6(1)

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CC BY 4.0

Authors:

Isabelle Bensidoun

Centre d'Etudes Prospectives et d'Informations Internationales

Deniz Ünal

Centre d'Etudes Prospectives et d'Informations Internationales

China and India have successfully integrated into the world economy. Once specialised in textiles, they have developed new export-oriented sectors linked to the information and communication technology (ICT), taking advantage of the globalisation process which has enlarged access to new technology, capital and markets. China has become a global export platform for electronic goods and India a global centre for ICT services. They have followed different paths of specialisation. China is heavily involved in the international segmentation of production processes in manufacturing, which is not the case of India. China is heavily specialised in mass exports of cheap goods, while India focuses on niches. Both countries are in a process of technological catch-up but in different industries. By the middle of this decade, the pattern of development followed by each of them seemed to have reached its limits and even before the shock of the global crisis in 2008, there was a debate about the changes necessary to make growth sustainable. The crisis has made clear that their long term growth will depend on their ability to build on their large domestic markets.

Large emerging economies: Manufactured exports in percent of manufacturing value added, (1980-2005)

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Share of high-tech products in manufactured exports (in % of manufactured exports of the country)

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China and India, size of working age population, 2000-2050

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. China and India: trade in services Share in percent of world services

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