India vs China
Lacking other criteria, we make judgments based on our own culture, values, and experience. The trouble is this narrow point of view isn't effective in the global marketplace. China is a country which understands this.
Chinese don't celebrate Holi or Diwali and the way they celebrate their festivals is not even close to how Indians celebrate their festivals but still China is in a tearing hurry to tap the Indian market. Come Holi or Diwali and the markets are flooded with pichkaris and crackers made in China. They are more attractive than the ones made in India so people have no qualms in going for them, although, theoretically, Indians despise this trend because it is causing heavy losses to Indian market. Moreover the quality that these low cost products offer is also very below standard. But whatever the misgivings on either side, trade is booming, even if there is no agreement on who is gaining.
Does it means that China will soon be overtaking U.S as India's main trading partner?
Chances are not too bleak. I agree, right now, China is just a pygmie compared to U.S.
They are able to withstand the competition only because of the low prices on which they are offering the product. They can afford this because their labour is cheap and also they are compromising on the quality of the product. If they improve the quality of product, they will surely have to raise the prices. But still those prices will be less as compared to U.S because the labour is still cheap as compared to U.S.
All it will do is open the floodgates. Indian markets will be literally flooded with Chinese goods.
But..But..But!!!
In theory you can only produce a finite amount before there is oversupply and this can already be seen in Chinese garment industry. So there is only a finite period of time in which any industry can grow and in some industries this will be reached in the next few years before it starts reach normal growth levels.
U.S's biggest asset is its brands and ability to brand and I can't see this being threatened in the short term. Biggest advantage that the U.S has over other countries is its African-American Sport and Entertainment stars. And China lacks on both these grounds. Chinese goods don't have big brand names or famous trendsetters to support them. So, in near future, I don't see China giving competition to U.S. But even India's position is not very pleasing on these grounds. So, China can surely give competition to India.
Ready or not, Indian industry will have to learn to tango with the dragon. China is here and it means business.
Chinese don't celebrate Holi or Diwali and the way they celebrate their festivals is not even close to how Indians celebrate their festivals but still China is in a tearing hurry to tap the Indian market. Come Holi or Diwali and the markets are flooded with pichkaris and crackers made in China. They are more attractive than the ones made in India so people have no qualms in going for them, although, theoretically, Indians despise this trend because it is causing heavy losses to Indian market. Moreover the quality that these low cost products offer is also very below standard. But whatever the misgivings on either side, trade is booming, even if there is no agreement on who is gaining.
Does it means that China will soon be overtaking U.S as India's main trading partner?
Chances are not too bleak. I agree, right now, China is just a pygmie compared to U.S.
They are able to withstand the competition only because of the low prices on which they are offering the product. They can afford this because their labour is cheap and also they are compromising on the quality of the product. If they improve the quality of product, they will surely have to raise the prices. But still those prices will be less as compared to U.S because the labour is still cheap as compared to U.S.
All it will do is open the floodgates. Indian markets will be literally flooded with Chinese goods.
But..But..But!!!
In theory you can only produce a finite amount before there is oversupply and this can already be seen in Chinese garment industry. So there is only a finite period of time in which any industry can grow and in some industries this will be reached in the next few years before it starts reach normal growth levels.
U.S's biggest asset is its brands and ability to brand and I can't see this being threatened in the short term. Biggest advantage that the U.S has over other countries is its African-American Sport and Entertainment stars. And China lacks on both these grounds. Chinese goods don't have big brand names or famous trendsetters to support them. So, in near future, I don't see China giving competition to U.S. But even India's position is not very pleasing on these grounds. So, China can surely give competition to India.
Ready or not, Indian industry will have to learn to tango with the dragon. China is here and it means business.
posted by Sangeeta at
10:21 PM
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