Case study of the economies of India and China
Entrepreneurship development affects multiple domains, although we frequently consider it as a single dynamic. Entrepreneurship can impact numerous industries and non-profits in a developing economy.
Entrepreneurship involves mobilizing human, financial, and mechanical resources to generate ideas. So, it serves more than economic progress and prowess. Entrepreneurship has social, cultural, and political effects beyond economic power. All these factors resound even truer when the case of a developing economy is considered, India and China, for instance.
Economic growth of India and China
The two countries have shown remarkable growth in terms of economy and entrepreneurship within a few decades. Both feature in the list of the top ten largest economies of the world; both have managed to lift themselves out of the shackles of poverty and grief; both have represented themselves as growing powers, be it in terms of human or financial capital. This is why looking at their examples becomes essential.
Case Study – Entrepreneurship and India
India, as a developing country, is grappled with multiple vices, and most of them are on the economic and social front. One of the biggest and most pertinent issues the country faces today is the problem of large-scale unemployment, which subsequently leads to multiple failures in terms of education and training, infrastructure and development, and social and moral growth.
Fostering entrepreneurship in India
Entrepreneurs, as business leaders, not only promote ideas and bring change but are also successful harbingers of the economic growth of India and entrepreneurship development. In India’s case, entrepreneurs have successfully promoted the capital formation and employment generation. The employment provided has been instantaneous and large-scale, and it seems true to say that fostering entrepreneurship in a country such as India can prove helpful on these fronts.
Obstacles to India’s entrepreneurship growth
Due to overpopulation and a lack of resources, India’s regional entrepreneurship development initiatives are hampered by slums and squatters. The country suffers from regional differences, including the world’s largest slum and one of the top ten richest men in the same county. To begin with, entrepreneurship has been effective in closing this gap gradually. Cottage industries and skill development have been used to strengthen the economy. Several underdeveloped locations can benefit from entrepreneurs’ innovations. The same applies to economic power concentration, as seen above. Successful entrepreneurs have reduced such gaps.
Statics of India’s economic growth
For anyone who has been observing keenly India’s economic progress, it is difficult to deny that the country has shown a powerful growth in GDP over the past few years, with about 6.6% annual growth in 2017. In fact, the country is presently the fastest-growing democracy in the world. The country owes this growth to its entrepreneurs, who constantly look out for opportunities. With their ideas and measures directed towards resource mobilization, skill and entrepreneurship development, and redeveloping the market, they have had a huge role to play in pulling up the Gross Domestic Product of the country, as well as showing a positive impact on the per capita income of the nation’s population.
India’s GDP rank
India’s GDP rank is currently 7th (nominal, 2018), whereas it is 3rd on the PPP list. The Ease of Doing Business Rank for the country has risen to 77, from the times a few decades back when talking about such a list for India was meaningless. No wonder, the country has made it to the world’s top ten largest economies.
Future prospects for India’s economy
The entrepreneurs’ expansion in foreign trade and commerce has had a positive impact on the country’s economy and relations with other nations. In barely two decades, India’s entrepreneurship has led to overall development, greater global links, and faster economic progress. Alongside this, it has spread learning and awareness across the nation. The country as a whole has benefited, as have society, small communities, underprivileged groups, and genders.
Case Study – China’s Entrepreneurial Spirit
China, as a nation, has shown remarkable growth in terms of entrepreneurial prowess. This entrepreneurship development has given China a competitive edge over the rest of the world. National trends from about half a year back have shown how the strength of non-state-owned enterprises has grown tremendously, thanks to China’s strongly growing entrepreneurial spirit.
The rise of entrepreneurship in China
China, known widely over the world for its effectual economic strategies, has had a prime motto of “mass entrepreneurship and innovation” for years now. This agenda led to the upsurge and development of multiple businesses and entrepreneurship development, ranging from very diverse and varied domains. Howsoever much the disparity between the organizations, the underlying framework remained the same, which was what they called entrepreneurial spirit. In nature and substance, the spirit was optimistic in nature.
The rise of China’s economy
The state of affairs was viewed in a different light by the rest of the world, and the economic growth of China was attributed more to monopolistic advantages than to industrial smartness. Little by little, the private sector of China was overtaken by a wide array of entrepreneurs, bringing about a large-scale reform. China, in the late 80s and early 90s, had set the stage for entrepreneurship to take the lead role. In fact, the country is presently considered the largest producer of low-cost in the world.
Entrepreneurial Familism in China
A national reform approach focused on start-ups and private companies to combat corruption, poor public health, and extreme poverty, which are common in developing economies. This highlighted two key elements of Chinese business and entrepreneurship development: familism and relational capital.
Familism was derived by seeing the country or organization as a family and putting it in charge of determining its worth and importance. GuanXi, or relational capital, is also rooted in a key Chinese social concept. Chinese entrepreneurs value human interactions and networks since the broader the network, the easier the development. It was deemed critical that the ‘human’ element be present and worrisome, whether in their wants or as a resource.
China’s GDP rank
The result is clear and loud. China is doing well in its GDP growth, with an annual change of 6.9%. Ranking second, only after America, it represents power in the list of the top ten largest economies of the world. It has set a world record for lifting more people above the poverty line than any other. There is a lot of room for improvement because the per capita income still lies below the world average. With China, however, it doesn’t seem to be a distant dream.
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Advocate Rahul Dev is a Patent Attorney & International Business Lawyer practicing Technology, Intellectual Property & Corporate Laws. He is reachable at rd (at) patentbusinesslawyer (dot) com & @rdpatentlawyer on Twitter.
Quoted in and contributed to 50+ national & international publications (Bloomberg, FirstPost, SwissInfo, Outlook Money, Yahoo News, Times of India, Economic Times, Business Standard, Quartz, Global Legal Post, International Bar Association, LawAsia, BioSpectrum Asia, Digital News Asia, e27, Leaders Speak, Entrepreneur India, VCCircle, AutoTech).
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