- China is ranked 27 in terms of starting a new business, while India is ranked 136 in this case.
- China is ranked 5 in contract enforcement, while India is ranked 163
new Delhi. India can beat China in the trade war by improving its ranking in the ease of starting a business and implementing contracts. State Bank of India (SBI) said this in its latest SBI EcoRap report. The report states that India and China in the World Ease of Doing Business Rankings, two parameters – Ease of Starting a Business and Contract Enforcement, can explain why India is not the world’s manufacturing hub.
The report said that if India wants to become a pure commodity exporting country, it should have a large manufacturing base. To make a large manufacturing base, both these things have to be corrected. According to the latest report of Ease of Doing Business, China is ranked 27 in terms of starting a new business, while India is ranked 136 in this case. At the same time, China is 5 in the contract enforcement, while India is ranked 163.
India is better than China in just one case of business convenience
India is better than China in just one case of business convenience. That is to get a loan. In this case, India’s ranking is much better than China. India’s gating credit rank is 25, while China’s rank is 80 in this case. In all other matters of business ease, China is in a much stronger position than India. China has a business rankings ranking of 31, while India has 63.
India used to export more than China in 1950s
The report, written by Dr. Saumya Kanti Ghosh, Group Chief Economic Advisor of SBI, states that India and China have adopted different growth models. In the 1950s, India’s exports were higher than China. China overtook India by paying more attention to exports. On the other hand, India paid more attention to its development. Its effect can be clearly seen on today’s export figures of both countries. According to WTO data, China’s total commodity exports in 2019 stood at $ 2,499 billion. India’s exports stood at $ 324 billion.
India has a cost advantage, but will have to improve capacity to defeat China
SBI said in the report that it is cheaper to import from India than to import from India. Despite this, border and regulatory compliance take longer in India than in China. That’s why traders prefer China more. We have a cost advantage, but we have to improve capacity to defeat China.
India can give a tough competition to China in the service sector
The report says that China’s service exports are more than India, but India can give a tough competition to China in the service sector. India’s telecommunications, computer and information service exports are significantly higher than China’s. However, China is also trying to reach India’s level of speed. India can improve its overall trade balance by focusing more on the service sector on the strength of its IT strength.