In the 1980s, India and China were on an equal economic footing. China's GDP today is five times that of India's, underscoring the growing chasm between the two countries. Akshat Shrivastava, founder of Wisdom Hatch, warns in a note at X that this divergence stems from the starkly different priorities of their leaders.
“All Indian political parties are simply running a free race: killing merit, encouraging freeloaders and zero preparation,” Srivastava said in a scathing critique. In contrast, China invested heavily in infrastructure, technology and an export-led economy to create a foundation that paid dividends.
In 1980, India's GDP was $186 billion, compared to China's $303 billion. But by 2024, China's GDP will reach $18.5 trillion – 61 times its 1980 level – while India's GDP will grow 21 times to $3.93 trillion. China's high-tech exports are now 43 times that of India's, and its manufacturing sector contributes 28% of global output, dwarfing India's 4%. Even on a per capita basis, China's GDP is $25,015, far ahead of India's $10,123.
Srivastava blames political apathy and short-term populism for India's slow progress. “What kind of meaningful future do you see for hardworking Indians?” he asked, calling for policies that prioritize merit over merit-based growth.
The focus on subsidies and freebies has stalled the meaningful reforms needed to prepare India for global competition, he adds.
Former RBI governor Raghuram Rajan had recently echoed these concerns. He cautioned against trying to emulate China's manufacturing model, warning of the backsliding of global powers. Rajan suggests that India capitalize on its strength in services exports, but even here, a lack of cohesive policies undermines potential gains.
China's rise stems from a clear strategy: economic reform, heavy investment in infrastructure, and a focus on technology and innovation. It became the world's largest exporter, worth $3.5 trillion annually, backed by advanced logistics and a skilled workforce of 200 million people. India has only 60 million in the manufacturing sector compared to India due to lack of adequate infrastructure and slow production efficiency.