Battle of the new Asian Titans
CHINA was described as a charging dragon with enormous investment potential and India a shambling elephant by a leading banker in Hong Kong yesterday.
The comparison was made by Bank of East Asia chief executive David Li Kwok-po in a debate entitled 'Is China or India the Best Asian Investment Bet'.
It was organised by the Canadian Chamber of Commerce.
India's case was presented by the president of the council of Hongkong Indian Association, Hari Harilela, who targeted the mainland's political uncertainties.
As the two speakers pointed out, both countries had large populations and a cheap labour force and both markets were undergoing reforms from a planned economy to a market economy, which made them competitors to a certain extent.
However, Mr Li doubted the effectiveness of the four-year reform in India. China's reforms had strong support from the masses because the mushrooming of rural enterprises had benefitted more than 70 per cent of the population, he said.
Indian reforms were carried out from the top down with support from a few politicians and bureaucrats because of their vested interests.
'Just six million people depend on the industrial sector that has been the focus of reform in India. But 600 million people have not experienced the benefits of agricultural reform.' India's productivity was far lower than China's despite similar wages and its GDP was less than half of that of China, he said.
Other problems such as power shortages, poor sanitary conditions and low literacy were also hindering India's pace of progress, Mr Li said.
He also criticised the legal system, a legacy of British rule, which many see as one of India's advantages over China.
'The legal system is there. But it is not practical at all. People are not enforcing it,' he said.
Mr Harilela said China was overshadowed by political uncertainties in the post-Deng era. The downgrading of China by international institutes was the best evidence of such fears, he said.
Mr Li said he wanted a visa to visit India after the debate. Mr Harilela, a leading Indian businessman in Hong Kong, is a Hong Kong affairs adviser for the PRC.