Since the early 1980s, China has consistently been the most rapidly growing economy on earth, keeping an average annual growth rate of 10%. Its unprecedentedly rapid growth makes China as a country with unrivaled economy. However, along with recent dire forecasts on Chinese economy, it has been proposed that economic growth and potential of India would eventually match China’s economy.
In 1990, India’s economy has a history of being eclipsed by China’s mainly due to its strict regulation and hostile environment for trade and investment. Now, in terms of size and per capita income, economists projects that India’s economy is near to where China’s was in 1990s.
India’s strength as a new China lies in low urbanization and Prime Minister Narendra Modi’s new “Made in India” that aims to make India a manufacturing hub in the world. With China’s high urbanization and losing edge in domestic production due to rising labor costs, India is paving its way to step up as the next China.