BRIC, E7, Largest Emerging Economies

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Average GDP Growth Rate of Asian Industrialized Countries Since 1981 :thumb:

My this post is just to keep a record of the comparative 'Average' Growth rate of India with "Newly Asian Industrialized" countries, along with the Matured Industrialized Asian countries like Korea, Japan, Singapore as below.

this effort is just to keep an eye on the Average Growth Rate of India since 1981 to 2013, as compare to other 'Asian' Industrialized Countries :thumb:

Select Country or Country Groups

=> Newly industrialized country - Wikipedia, the free encyclopedia


Growth Rate Comparison since 1980 to 2013, for the 34 years

1st, China: 9.89% since 1980

2nd, India: 6.2% since 1981

3rd, Philippines: 3.4% since 1980

4th, Thailand: 5.4% since 1980

5th, Indonesia: 5.2% since 1980

6th, Malaysia: 5.8% since 1980

7th, Singapore: 6.6% since 1980

8th, Korea: 6.2% since 1980

9th, Taiwan: 5.7% since 1980

10th, Japan: 2.1% since 1980

Select Country or Country Groups


and this comparison clearly tells us, how population growth rate of around 2% since 1981, with 500mil extra people this way, has covered every success of India since 1947. while total number of Middle Class of India is itself more than total population at the time of freedom, 1947 :facepalm:


=> we also have a comparison of India and China's Per Capita Income on PPP since 1990 as below, telling us the difference between Indian Open Market strategy with Chinese one since 1990...... India could have only around 5.3% growth rate for the 12 years in between 1991 to 2001, because of failing to even 'copy' the Chinese Economic Reforms in 1991 :toilet:

India GDP - real growth rate - Economy


BRITAIN GDP PER CAPITA PPP at 1990, $15,650
United Kingdom GDP per capita PPP

RUSSIA GDP PER CAPITA PPP at 1990, $8013
Russia GDP per capita PPP

INDIA GDP PER CAPITA PPP at 1990, $873.76
India GDP per capita PPP

CHINA GDP PER CAPITA PPP AT 1990, $794.93
China GDP per capita PPP
 
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The rise of Asia and the new world order

The global economy is undergoing a fundamental change. Despite concerns over slowing growth in the People's Republic of China, India, and Japan, and the possible dissolution of the eurozone, global economic growth is accelerating.

How can this paradox be explained? If the global economy is shifting toward the more rapidly growing economies, then the world's growth rate would shift toward the growth rates of the more rapidly growing economies. Thus, even if the growth rates of the PRC and India were to slow, global growth, which is considerably lower than that of both countries, would accelerate.

The growth acceleration will lead to a new world economic order, associated with more rapidly growing countries such as the PRC and India, which are going to have a larger share of the global economy.

The PRC overtook Japan as the world's second-largest economy in 2010. But, the World Bank noted that this milestone had been reached in 2005 in current purchasing price parity (PPP). In terms of PPP, the PRC will overtake the United States (US) in 2017, according to the International Monetary Fund and India will overtake Japan in PPP in 2012. The US has been the world's leading economy for more than a century.

The new world order will look very different in 2020. Asia will boast three of the four biggest economies in the world. As Figure 1 shows, the largest economies in descending order would be the PRC, the US, India, Japan, Russia, Germany, Brazil, and the United Kingdom, based on shares of world GDP expressed in current PPP (the methodology and an earlier data set can be found in Jorgenson and Vu 2011).

Figure 1: New Economic Order 2020
Shares of World GDP (%)




Sources of economic growth

The sources of economic growth are capital input, labor input, and productivity. Everything depends on technology and demography because labor input is essentially driven on the supply side by demography; productivity is driven by technology; and capital input is determined by the growth of the economy.

Sources of economic growth can be classified between the replication of existing technologies and innovation (i.e., production processes and products). Replication entails increasing labor and capital inputs, and output increases in proportion to the rise in input, so there is no contribution to productivity growth. In contrast, innovation entails changes in technology, whereby increases in output exceed the growth of inputs.

Evidence shows that global growth is mostly from replication and not innovation, since productivity explains only a modest proportion of growth, even for rapidly growing countries like China and India.


Projecting world economic growth

Projections show that the world economy will accelerate, with 3.6% growth in 2010–2020, versus 3.3% in 1990–2010, notwithstanding negative demographic trends due to an ageing population and a declining workforce. Labor productivity growth, capital and labor quality, and closing the gap between output and capital will be major sources of the acceleration.

The G8 and G20 countries will continue to grow in 2010–2020, but the BRICS countries (Brazil, Russia, India, PRC) will grow even faster.

Japan's base case projection for the period of 2010–2020 in labor productivity growth is 1.8%, which is similar to the period of 1990–2010. However, labor force growth is unfavorable. Because of its aging population Japan's annual average growth shrank for 1990–2010, and is expected to slow even further in 2010–2020. After combining labor productivity and labor force growth, the base case GDP projection of annual growth rate is 0.7%. This figure is lower than Japan's official growth target for GDP, which is 2% in real and 3% in nominal terms. This projection does not take into account possible policy changes such as increasing immigration and boosting workforce participation of women and the elderly.

The PRC's growth is expected to slow on negative demography and labor productivity trends. However, its growth rate will remain above 7%. India will grow at 6.5%, a slightly faster rate than in the 1990–2010 period.

Growth will slow for Hong Kong, China; Indonesia; Republic of Korea; Malaysia; Singapore; and Taipei,China, but Asian and global economic expansion as a whole will accelerate, driven by the PRC and India.

The emergence of Asia from the underdevelopment that persisted until the middle of the last century is the great economic achievement of our time. This has created a new model for economic growth built on globalization and the patient accumulation of human and nonhuman capital over decades. The new growth paradigm places a premium on skillful management by public and private authorities. The performance of the leading countries in developing this paradigm – Japan, then the Asian Tigers, and now China and India – has changed the course of economic development in Asia and around the world.

References:

Dale W. Jorgenson and Khuong M. Vu. The rise of developing Asia and the new economic order. Journal of Policy Modelling. Volume 33. Issue 5. September/October 2011.

The rise of Asia and the new world order | Asia Pathways
 

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London: India has probably surpassed Japan to become the world's third largest economy after the US and China, Paris-based think-tank OECD said today even as it lowered the country's economic growth projection for 2013 to 5.3 percent.

"China will likely pass the United States as the world's largest economy in the next few years and India has probably recently surpassed Japan to be third largest," said the OECD Economic Outlook report.

Good news: India has probably pipped Japan as third largest economy - Firstpost
Indian economy was already at around $5.16trillion on PPP by 2007, as estimated by both World Bank and IMF, but then US/UK manipulated the data's, changed the way of measuring GDP on PPP...... otherwise India was already on the 3rd position by 2007, leaving Japan at 4th with around $4.5trillion GDP that year, i remember :ranger:

Feb 29, 2008

"There are, however, practical difficulties in deriving GDP at PPP, and we now have two different estimates of the PPP conversion factor for 2005, India's GDP at PPP is estimated at $ 5.16 trillion or $ 3.19 trillion depending on whether the old or new conversion factor is used," it said.

It's official: India's a trillion-$ economy - Times Of India
 

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2013 Global Manufacturing Competitiveness Index
November 16, 2012

The U.S., the world's largest economy, will slip to fifth place from third in manufacturing competitiveness in the next five years as India and Brazil race ahead, according to a report.

China will remain in the top spot while India rises to second from fourth and Brazil jumps from eighth to third, according to the 2013 Global Manufacturing Competitiveness Index compiled by Deloitte Touche Tohmatsu and the U.S. Council on Competitiveness. The index, which was first introduced in 2010, reflects perceptions of more than 550 senior corporate leaders surveyed about how 38 countries rank currently and will fare in five years.

Executives said access to talented workers is the top indicator of competitiveness, followed by a country's trade, financial and tax policies, according to the report, which was to be published today.

"From a U.S. perspective we didn't change that much, but it's just that others are moving rapidly," Samuel Allen, chairman and chief executive officer of Deere & Co. (DE) and chairman of the council, said in a telephone interview. "We can't tread water whether it be in education, tax reform or continued investment in infrastructure."

The current and future rankings reinforce the perception that the U.S. is "living off of investments we made a long time ago," Allen said. He said he worries about factors such as deteriorating U.S. infrastructure that may increase costs to move goods, and energy policies that could boost fuel prices.

'Continued Deterioration'

While Deere, the world's largest (DE) maker of farm equipment, has factories around the world, it still has invested about 57 percent of its capital in the U.S. in the last five years, Allen said. The Moline, Illinois-based manufacturer generated 61 percent of its revenue (DE) in the U.S. and Canada last year, according to data compiled by Bloomberg.

"What you worry about is the continued deterioration of the critical success factors to manufacture here," Allen said.

The U.S. still can improve its competitiveness by reforming its tax structure and controlling its debt, Allen said.

According to the report, Germany will move from second to fourth in the competitiveness ranking, South Korea will fall from fifth to sixth, Taiwan will go from sixth to seventh, Canada will drop from seventh to eighth, and Japan falls out of the top 10 list altogether, tumbling from 10th to 12th. Vietnam, meanwhile, will jump from 18th to 10th and Singapore will maintain its No. 9 ranking.

'Sobering' Findings

Another "sobering" finding in the report is that in five years Germany will be the only European country in the top 15 spots for manufacturing competitiveness, as the U.K. and Poland slide, Allen said.

The world is seeing a "power shift" of competitiveness toward developing countries, particularly those in Asia, said Deborah L. Wince-Smith, CEO of the Washington-based council that includes business, academic and labor leaders.

China and other emerging countries are increasingly manufacturing advanced goods, said Craig Giffi, the U.S. consumer and industrial products industry leader at Deloitte who co-authored the report.

While emerging manufacturing powers still face challenges in improving their infrastructure, supplier networks and legal systems, the countries are investing to drive growth and jobs, according to the report.

"We are at an inflection point," Giffi said. "For developed nations, it's going to get harder."

Aside from the responses of top executives, the study was based on interviews with "key manufacturing players" and contributors from Deloitte, the council, the Indian Institute of Management in Lucknow, and Clemson University in South Carolina, according to the report.

U.S. Competitiveness Slips as India Jumps in Five Years - Businessweek

India up from 12th to 9th position in industrial production, by 2009
09 March 2010

New Delhi / Vienna: A new report by the United Nations Industrial Development Organization (UNIDO) states that India has emerged as one of the world's top ten countries in industrial production.

According to UNIDO's 'Yearbook of Industrial Statistics 2010' the top ten in 2009 were: the U.S., China, Japan, Germany, the Republic of Korea, France, Italy, the U.K., India (9th) and Brazil. India surpassed Canada, Brazil and Mexico in 2009 to reach the 9th position from the 12th position it held in 2008.

India is among the global top ten in the following sectors: basic metals; electrical machinery and apparatus; and other transport equipment, other than motor vehicles, trailers and semi-trailers; textiles; leather, leather products and footwear; coke, refined petroleum products, nuclear fuel; chemicals and chemical products. :thumb:

According to UNIDO estimates, India's manufacturing value added (MVA) per capita is 283 US$ compared to 631 US$ of Brazil.

The report reveals that China is now the world's second largest producer of manufacturing output. The share of China in world total of manufacturing value added (MVA) at constant 2000 US$ has reached 15.6 per cent in 2009, compared to 15.4 per cent of Japan, while the USA maintains its first rank with 19 per cent. These three countries combined produce half of the world manufacturing output.

Despite the lead of China in absolute amount of production, the report suggests that Japan is still the most industrialized country of the world in terms of MVA per capita. Japan's MVA per capita for 2008 was almost 9000 US$ compared to about 700$ of China.

The report also suggests that the effect of the recent financial crisis on industrial growth was severe for industrialized countries, but relatively mild for developing countries.

UNIDO's International Yearbook of Industrial Statistics 2010 is the only international publication providing economists, planners, policymakers and business people with worldwide statistics on current performance and trends in the manufacturing sector. The publication presents recent data from national industrial surveys for more than 70 countries in detail. UNIDO maintains international industrial statistics database and disseminates its statistical products to the wide range of international data users.

The Yearbook of Industrial Statistics 2010 also provides internationally comparable data for major indicators of manufacturing activity. The data can be used to analyze patterns of growth and related long term trends, structural change and industrial performance in individual industries.

MACHINIST - India up from 12th to 9th position in industrial production : UNIDO report
 
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Manufacturing Sector in India
March 2013

Indian economy has made significant progress over the last few years, with the gross domestic product (GDP) growing at an average rate of 5.3 per cent. The country is the world's third largest economy in terms of the purchasing power parity (PPP) and has investments amounting to nearly a trillion dollars lined up in partnership with the private sector in the coming years. Manufacturing, as an industry segment, is a crucial cog in the wheel of progress and has largely insulated the Indian economy from a future global turmoil; thanks to its innovation-driven orientation. The Government has also ensured a suitable manufacturing eco-system for domestic and international majors by strengthening the sector in every possible way.

India's manufacturing sector is poised for immense growth in future owing to its eminent talent pool in science, technology and research. Deloitte's global index, 2013, for 38 nations, has ranked India the fourth most competitive manufacturing nation, behind China, the US and Germany. Not only this, but even the Global Manufacturing Competitiveness Index, 2013, based on a survey of CEOs, executives and other officials of 550 global manufacturing companies, has positioned India as second five years down the line, next only to China. :thumb:

Growth Trend

Driven by a robust pick in domestic orders and strengthening of international demand, India's manufacturing sector registered remarkable growth in February 2013. The HSBC India Manufacturing Purchasing Managers' Index (PMI) - a measure of factory production - stood at 54.2 in February 2013, up from 53.2 in the previous month, indicating an improvement in the overall health of the Indian manufacturing sector.

The volume of incoming new orders at manufacturing firms in India rose during the month with around 29 per cent of monitored companies reporting higher levels of new work.

Manufacturing Sector in India, Manufacturing Industry, Indian Industries


=>I hope India might have got the 5th place by 2012 in this regard :ranger:

 
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China Ranked Most Competitive Manufacturing Nation in the World:china:

Over the next five years, 20th-century manufacturing stalwarts like the United States, Germany and Japan will be challenged to maintain their competitive edge to emerging nations such as China, India and Brazil, according to the 2013 Global Manufacturing Competitiveness Index report from Deloitte Touche Tohmatsu Limited's (DTTL) Global Manufacturing Industry group and the U.S. Council on Competitiveness. :thumb:

The report confirms that the landscape for competitive manufacturing is in the midst of a massive power shift – based on an in-depth analysis of survey responses from more than 550 chief executive officers (CEOs) and senior leaders at manufacturing companies around the world.

(India looks good as below???? :india:)



The 2013 Global Manufacturing Competitiveness Index once again ranks China as the most competitive manufacturing nation in the world both today, and five years from now. Germany and the United States round out the top three competitive manufacturing nations, but, according to the survey, both fall five years from now, with Germany ranking fourth and the United States ranking fifth, only slightly ahead of the Republic of Korea. The two other developed nations currently in the top 10 are also expected to be less competitive in five years: Canada slides from seventh to eighth place and Japan drops out of the top 10 entirely, falling to 12th place.

(we hope to see India on 2nd place soon, as below :thumb:)


The report found that access to talented workers is the top indicator of a country's competitiveness – followed by a country's trade, financial and tax system, and then the cost of labor and materials. Enhancing and growing an effective talent base remains core to competitiveness among the traditional manufacturing leaders – and increasingly among emerging market challengers as well.

Manufacturing still matters a great deal for the economic prosperity of 20th century powerhouses – and these nations continue to have enough going for them to stay in the game and even thrive.

China Ranked Most Competitive Manufacturing Nation in the World - arabiangazette.com
 

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=>I hope India might have got the 5th place by 2012 in this regard :ranger:


we have data's to 2009 as below, listing the total manufacturing output by countries till 2009 :ranger:

Manufacturing output statistics - countries compared - Nation Master


one more news we have as below in this regard. this way considering 15.2% share of manufacturing in India's GDP at around $2.0 trillion by the financial year 2012-13, we find it to be around 0.152 * 2,000 = $300 billions, which would put India on the 5th or 6th spot by 2012, at least, as we do know that all the major European nations suffered fall in Industrial output since 2009 :thumb:

Owing to slowdown and unutilised excess capacity, manufacturing activity, as a share of India's Gross Domestic Product (GDP), plunged to 15.2 per cent during the financial year 2012-13. Further, it is expected to fall below 15 per cent in the current fiscal, according to Assocham.

Its share to the GDP in 2010-11 was 16.2 per cent and 15.7 per cent during 2011-12. The drop comes amidst government's target to achieve 25 per cent contribution to the total economic activity by 2020. On the contrary, Assocham said, the trend is certainly moving in the reverse direction in line with the decelerating agriculture sector, whose contribution to the total economic output reduced to about 13.4 per cent from about 14.5 per cent two years ago.

"This is despite the fact that the government has been insisting on taking this share to 25 per cent and major initiatives were announced to make manufacturing vibrant part of the economy, which depends predominantly (as much as 60 per cent) on services. Depending too much on services is not good for India because our manufacturing could not scale up to the global standards in the first place," Assocham said.

Due to manufacturing sector's lacklustre performance, industrial output fell from 28.2 per cent in 2010-11 to 27 per cent in 2012-13.

"The serious consequence of dropping agri output and its contribution to the GDP is further displacement of people in the agrarian sector. Well over 60 per cent people depend on agriculture and their share in the GDP cake is limited to just about 13.7%. This is a serious disequilibrium and is anything but inclusive growth, which will remain a mere slogan if urgent measures are not taken to shift people away from agriculture sector," it said.

An analysis of the disaggregate data available till December, 2012 from April, exports to EU and Asian countries have suffered a major setback. While exports to the European Union, accounting for 16.3% in India's merchandise exports, declined by 11.2%, those to Asian countries (excluding Japan), with a share of 28.1%, contracted by 8.4% in April-September, 2012. :ranger:

Manufacturing sector share to GDP likely to fall - The New Indian Express

he share of manufacturing in India's gross domestic product has been coming down, declining to 15.2 percent in fiscal 2012-13 and is expected to fall below 15 percent in the current financial year since the sector is facing slowdown and unutilised excess capacity, an ASSOCHAM study has cautioned.


The other problem for the manufacturing has been a big setback for exports which find market for the industrial products in the overseas markets.

As per analysis of the disaggregate date made available till December, 2012 from April, exports to European Union and Asian countries has suffered a major setback. While exports to EU, accounting for 16.3 percent in India's merchandise exports, declined by 11.2 percent, those to Asian countries, (excluding Japan) with a share of 28.1 percent, contracted by 8.4 percent during April-September 2012.

Infrastructure bottlenecks and regulatory hurdles for mega projects are also hindrances in taking leap forward in industrial activity.:toilet:

Rightly, Governor of the Reserve Bank of India D Subbarao has observed that there is over-capacity in the industry and no fresh investment can take place unless full capacity is utilised, which is again a function of consumer confidence, demand and employment.

Manufacturing's share in GDP on decline
 
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Market Potential Index (MPI) for Emerging Markets - 2011
March 16, 2012

This indexing study is conducted by MSU-IBC to help companies compare the Emerging Markets with each other on several dimensions. Eight dimensions are chosen to represent the market potential of a country over a scale of 1 to 100. Each dimension is measured using various indicators, and are weighted in determining their contribution to the Overall Market Potential Index.

(MSU-IBC:- International Business Center (CIBER). International Business Center : International Business Center (CIBER): Global Initiatives : Eli Broad College of Business at Michigan State University)



Market Potential Index (MPI) for Emerging Markets - 2011 >> globalEDGE: Your source for Global Business Knowledge

we may have a look on the list as below too. to have an idea about the Stock Market Capitalization of the major economies, as below :ranger:

This entry gives the value of shares issued by publicly traded companies at a price determined in the national stock markets on the final day of the period indicated.

=> https://www.cia.gov/library//publications/the-world-factbook/rankorder/2200rank.html


=> in fact Indian Stock Market was at its high by 2008 :ranger:


=> and the same while considering "Total Market Capitalization to GDP ratio", we have as below: (as of 2012) :thumb:

Total market capitalization to GDP ratio



If you have been working daily with macro numbers then probably this would entice you. Total market capitalization to GDP is an indicator of the total listed wealth of a country as a percentage of its GDP. Ratio above 100% which actually values economy more than its GDP is said to depict that the market is overvalued, while a value of around 50%, which is near the historical average for the U.S. market, is said to show undervaluation. More developed a country is more can be its market capitalization to GDP ratio. Since there isn't any specific level for straight conclusion, one should compare this ratio with peer (in economy terms) countries.

Total market capitalization to GDP ratio | Fixed Income India
 
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Global Innovation Index rankings

Country/Economy - Score (0–100) - Rank

China - 45.4 - 34

Russian Federation - 37.9 - 51

Brazil - 36.6 - 58

India - 35.7 - 64

Turkey - 34.1 - 74

Mexico - 32.9 - 79

Indonesia - 28.1 - 100

http://www.globalinnovationindex.org/gii/main/fullreport/files/Global Innovation Index 2012.pdf


Innovation Efficiency Index, top 10


the Table by World Bank as below clearly tells us the dominance of China on the side of High Tech Productions, the real Rise of China :china:

and good to see India exporting more High Tech Products than Brazil, as below. it does says that India is somewhere, but yes, far behind China :ranger:


=> High-technology exports (current US$)

High-technology exports (current US$) | Data | Table
 

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I hope India might have got the 5th place by 2012 in this regard :ranger:


China Widens Lead as World's Largest Manufacturer
March 14th, 2013

According to the latest research from the United Nations, China has further outpaced its competitors in world manufacturing, generating $2.9 trillion in output annually versus $2.43 trillion from the U.S., the world's second-largest manufacturing economy. :china:

Over the last two years, China's manufacturing sector has made strong gains, while the U.S. has been mired in economic and political doldrums.

"In 2011, China's manufacturing output surged by 23 percent while manufacturing output in the U.S. only increased by 2.8 percent," the American Enterprise Institute explains. "That brought China's manufacturing output last year to more than $2.9 trillion, which was almost half a trillion dollars (and 20 percent) more manufacturing output than the $2.43 trillion of manufacturing output that was produced in the U.S. last year."

America's trade gap with China also widened considerably over the same period. According to statistics from the Manufacturers Alliance for Productivity and Innovation (MAPI), the U.S. trade deficit with China rose by 8 percent to $498 billion in 2012, while the Chinese surplus increased 15 percent, to $755 billion.

MAPI officials point out that from 2009 to 2012, "the U.S. deficit rose by $172 billion, or 53 percent, while the Chinese surplus soared by $333 billion, or an extraordinary 79 percent."

In addition to striking a blow to national pride, the comparatively slower growth in U.S. production versus Chinese manufacturing has also cost many jobs. MAPI found that the three-year increase in the U.S. trade deficit resulted in the loss of 700,000 to 1.4 million American manufacturing jobs, including 140,000 to 280,000 jobs in 2012 alone. :ranger:

China's output gains have been driven primarily through domestic demand, as "gains in new business allowed manufacturers to step up production by adding jobs and making more purchases," the Associated Press reports. :truestory:

HSBC's chief China economist, Qu Hongbin Qu, told AP that while external demand was still "tepid," the domestic-driven restocking process "is likely to add steam to China's ongoing recovery in the coming months."

However, many experts consider the rapid growth in Chinese manufacturing to be unsustainable unless the country begins to reorient its economy toward more advanced processes and complex products.

China is currently in an "edgy transition," the Financial Times notes. "As the country ages and reaches the limits of physical labor and capital accumulation, its growth model will have to shift towards transformative technology and innovation."

The factors putting stress on China's industrial economy include a downturn in overall productivity, which is a vital part of economic growth and depends on technological change and institutional efficiency. So while China might have produce a higher quantity of manufactured goods, the U.S. still leads in quality and advanced manufacturing, particularly aircraft and other specialized products.

Moreover, the costs of offshoring production are becoming increasingly onerous for U.S. companies. Given the insecurity of intellectual property in China and other factors, many businesses are discovering that it makes more sense to keep production capacity at home.

Last year, Manufacturing Trends and News concluded that "changes in the economic environment are making homeshoring more and more attractive, with a number of manufacturers actively moving their offshore operations back to the home turf."

Instead of simply looking at cheaper labor costs, manufacturers now look at the "total cost of ownership," or TCO. This relies on a comprehensive view of the manufacturing industry, taking into account the cost of quality, delivery, transportation, energy consumption, labor monitoring, carrying stock, freight, packaging, and all other aspects of production.

In addition, Chinese labor costs are rising an average 15 to 20 percent per year, compared to only 2 percent increases in the U.S. :thumb:

More importantly, the overall U.S. economy is considerably more diverse and less dependent on a handful of major industries than China's, meaning that growth can continue despite slowdowns in individual industries.

"America's household consumption alone generated $10.7 trillion of economic activity in 2011 – $3.5 trillion more than China's entire gross domestic product," the Atlantic observes. "This, despite the fact that our population is one quarter the size."

Despite China's accelerating growth, the U.S. continues to lead in top-end manufacturing and smart technologies. And if additive manufacturing, or 3-D printing, expands as forecast, America is likely to further solidify its position as the world's leader in advanced production capabilities.

China Widens Lead as World's Largest Manufacturer
 

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Outward FDI Exceed Inward Flows
NEW DELHI, MAY 22

India's overseas investments reached close to 27 billion dollars, exceeding the inflows on equity account of Foreign Direct Investment (FDI) in fiscal 2012-13, ASSOCHAM findings revealed here today.

The study said India's overseas investment, comprising loans, equity and loans guaranteed aggregated to 26.83 billion dollars in financial year 2012-13, with maximum outflows taking place in October-January. However, the maximum outflow took place in June touching 3.53 billion dollars, the study said.

It said overseas investments would exceed the FDI inflows on account of equity capital which totalled nearly 21 billion dollars between April- February of the fiscal 2012-13, the latest period for which data is available. Unlike in March, 2012, when one or two big ticket investments had pushed the monthly figure to a new high, there was no major inflow during March, 2013, the study said. :ranger:

The study says in so far as the outward investments from India are concerned, they have mostly gone to Singapore, the Netherlands and a significant amount to the tax haven of Cayman Islands. For instance in March, out of the 1.88 billion dollars of total overseas investments, close to one billion dollars went to Cayman Islands.

The study said although India's overseas investment is higher than the inward inflows, the overall investment climate in most parts of the globe is a dampener. "Risk aversion and lack of investment appetite is seen all through. It is not that only India is losing its position as an investment destination, but there is a demand slowdown and over capacity in many parts of the globe," according to the findings.

The study reveals that investment from Indian companies abroad has gone in areas relating to manufacturing, trade, restaurants, agri business and mining businesses. :thumb: On the other hand, recent bullish trends in the global stock markets are seen riding on quantitative easing and printing of money by central banks, mainly in the United States, some European countries and significantly in Japan. UNI

http://www.univarta.com/eng/display...k=3325weare24olym54hrt56u6755uwere21stories22
 
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India needs free floating Gold, with no import tax on it :india:



I always support Gold Import as its all about a foreign currency in terms of gold, which floats as per market demand and having high gold import in fact help the Trade Balance in tough times. for example, like how we saw even export of Gold in first quarter of 2009, when Indian Rupees depreciated to Rs50/US$, from its Rs40/$ level of mid 2008, which then made the Gold price lesser in the Indian market as compare the its Dollar value in the international market, which then resulted in even export of Gold coins from India in the first quarter of 2009, during the peak of recession.......

=> India gold investment turns negative for first time - Livemint

Gold import has a unique role in the Indian trade and it can't be equated to oil import, as its in fact the "most valued foreign currency". there must not be any tax on the Gold import to keep it always floating....:thumb:

Indian Rupees (INR) has to be depreciated to 1.0 INR = 1.5 Pakistani Rupees to 1.0 Yuan = 10.0 INR, to around 1.0 US$ = 65.0 INR

=> Indian rupee bounces back by 60 paise to 57.79 against dollar - Business Today :toilet:

the above news below clearly means that Indian Government has to make Gold Import easier than before, until Indian Rupees remains 'Over Valued', until it is depreciated to 1.0 US$ = 65 INR. as we do expect Gold import to put more pressure on the INR to bring it to the level, where we may have enough resistance to imported products, which will bring down the Trade Deficit, CAD, with the same rate.......

(and it will be the time when gold import too will become expansive to be imported this way.......)

its clear that if Indian 35% import accounts for only Oil, and those manufactured products which may be produced in India itself. and as these items are very cheap to be imported, so it has to be made expansive enough to be less imported. and its possible only when government has to, as we dont produce more than 25% of oil consumption...

we hope to see Indian Rupees to be at least at around its true value by end 2013, at around 1.0 INR = 1.5 Pakistani Rupees to 1.0 Yuan = 10.0 INR, hence to around 1.0 US$ = 65.0 INR :thumb:
 
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hello_10

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in fact, we would reach an acceptable CAD/ Trade Deficit level at 1.0 US$ = 70.0+ IRN only :ranger:

I myself would support RBI's interference only when rupees value break 71.0/1.0 US$ level :thumb:

Rupee still 17.6 per cent overvalued

Nomura Singapore Limited states that its FX valuation model shows that the rupee is still about 17.6 per cent overvalued, giving more room for weakness.

Now that the rupee is trading below 60 to the dollar, Nomura said the chances of government or authorities to implement measures soon have risen.

"We doubt the RBI can continue to intervene aggressively, as the more it intervenes, the greater the vulnerability to further capital outflows," the note says.

India's current account deficit (CAD) for the March quarter was $18.1 billion, or 3.6 per cent of GDP, lower than expected and below the $21.7 billion deficit a year earlier.

The Rupee is moving in on record low on fixing-related US dollar buying, say dealers.

The current account gap for the full fiscal year ending in March 2013 was $87.8 billion, which was 4.8% of GDP, compared with $78.2 billion (4.2%) a year earlier.

The April-March CAD stood at $88.2 billion and the Q4 Balance of Payments ( BoP) stood at a surplus of $300 billion versus a $600 billion deficit year-on-year. "The high current account deficit witnessed during 2012-13 and it's financing increasingly through debt flows particularly by trade credit resulted in significant rise in India's external debt during 2012-13," said RBI.

According to Nomura, one event that could be implemented quickly and lead to a sharp, temporary halt of rupee depreciation is the announcement of a large NRI bond issuance.

Some real sector reforms that we think are possible include clarity on gas pricing policy and measures to attract greater capital inflows into India such as raising FDI limits in select sectors and relaxing external commercial borrowing limits further. Moreover, pending legislative reforms (land acquisition; companies bill) could be taken up during the monsoon session (Jul-Aug) of parliament.

Nomura sees the weak currency as a negative for India's growth, as it increases imported cost inflation and exposes the corporate sector with unhedged overseas loans.

The RBI is also likely to delay rate cuts and keep liquidity tight as financial stability takes precedence, hurting domestic growth even further.

Rupee still 17.6 per cent overvalued: Nomura - The Economic Times
 

hello_10

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its in details as below: :thumb:

first here, the Table by World Bank as below clearly tells us the dominance of China on the side of High Tech Productions, the real Rise of China :china:

also its good to see India exporting more High Tech Products than Brazil, as below. it does says that India is somewhere, but yes, far behind China :ranger:


=> High-technology exports (current US$)

High-technology exports (current US$) | Data | Table



=> China Ranked Most Competitive Manufacturing Nation in the World :truestory:

Over the next five years, 20th-century manufacturing stalwarts like the United States, Germany and Japan will be challenged to maintain their competitive edge to emerging nations such as China, India and Brazil, according to the 2013 Global Manufacturing Competitiveness Index report from Deloitte Touche Tohmatsu Limited's (DTTL) Global Manufacturing Industry group and the U.S. Council on Competitiveness.

The report confirms that the landscape for competitive manufacturing is in the midst of a massive power shift – based on an in-depth analysis of survey responses from more than 550 chief executive officers (CEOs) and senior leaders at manufacturing companies around the world.

(India looks good as below????)



The 2013 Global Manufacturing Competitiveness Index once again ranks China as the most competitive manufacturing nation in the world both today, and five years from now. Germany and the United States round out the top three competitive manufacturing nations, but, according to the survey, both fall five years from now, with Germany ranking fourth and the United States ranking fifth, only slightly ahead of the Republic of Korea. The two other developed nations currently in the top 10 are also expected to be less competitive in five years: Canada slides from seventh to eighth place and Japan drops out of the top 10 entirely, falling to 12th place.

(we hope to see India on 2nd place soon, as below :thumb:)


The report found that access to talented workers is the top indicator of a country's competitiveness – followed by a country's trade, financial and tax system, and then the cost of labor and materials. Enhancing and growing an effective talent base remains core to competitiveness among the traditional manufacturing leaders – and increasingly among emerging market challengers as well.

Manufacturing still matters a great deal for the economic prosperity of 20th century powerhouses – and these nations continue to have enough going for them to stay in the game and even thrive.

China Ranked Most Competitive Manufacturing Nation in the World - arabiangazette.com

Will India Match China's Manufacturing Might?

When C. Northcote Parkinson -- economist, historian and humorist -- wrote "East and West" in 1963, the book's basic theme was that one day, India and China would combine to take on the West. At the time, the Sino-Indian war had just ended, and the book didn't make many waves. Over the past few years, however, things have changed; everyone has been talking about the powerful combination of India's expertise in software and services and China's capabilities in manufacturing. Today, there's a new twist. China has been upping its strength in the former and India has a newfound confidence in its might in the latter.

This is not confined to the IT arena. "India will emerge as a strong manufacturing base," predicts Janat Shah, a professor of production and operations management at the Indian Institute of Management, Bangalore (IIMB) and founder-chairperson of its Center for Supply Chain Management. Jagdish Sheth, marketing professor at Emory University's Goizueta Business School in Atlanta, adds that India will become "a second sourcing destination" for the world economy.

The numbers have already started signaling this development. In March, a new United Nations Industrial Development Organization report put India as one of the top 10 manufacturers in 2010. "India tops developing countries (China excluded) in production of textiles, chemical products, basic metals, general machinery and equipment, and electrical machinery," the report noted. In motor vehicle production, the country has overtaken Brazil and is behind only Mexico among developing countries. India's manufacturing value added has grown by over 10%, compared to 3.4% for the industrialized countries. The share of China, India and Brazil in world manufacturing output is now 32%, up from 20% a decade ago.

Examples of this manufacturing story are everywhere. In March, General Motors India announced that the company wants to become an outsourced vendor of car engines made at the newly-opened Maharashtra plant. The firm also wants to ship the parts to GM's joint ventures in China. GM India's strategy is to find customers for the excess capacity at its US$220 million engine manufacturing plant at Talegaon near Pune. The plant can make 300,000 engines a year, but GM India doesn't need them all immediately. Last year, the company sold 110,000 Chevrolet cars in India, and expects to hit 300,000 only in 2013. "If I need to sell 300,000 engines [annually] domestically, then I need to start filling the gap," GM India president and managing director Karl Slym told business daily Business Standard.

Pharmaceutical company AstraZeneca sources active pharma ingredients (APIs) from India for use in its global operations, according to James Chelliah, CFO for branded generics operations at AstraZeneca India. "Over the years [sourcing from India] has been increasing year on year by around 100%," he says. "Of course, it's on a small base.... China is big for us from a market perspective. Our China business will be almost US$1 billion this year. But from a sourcing perspective, India is ahead of China."

Through a partnership between Suzuki and Nissan, Indian subsidiary Maruti Suzuki manufactures the Pixo model compact car for sale in Europe, according to Mayank Pareek, Maruti Suzuki India's managing executive officer for marketing & sales. The Indian auto major is likely to start making vehicles for Volkswagen soon; in 2009, the German carmaker bought a 19.9% stake in Suzuki for US$4.5 billion. "The scope of the tie-up is under discussion between Suzuki and Volkswagen," adds Pareek.

At Pfizer India, Thomas Lobo, director of global external supply, says there has been a significant increase in sourcing activity from India with an average annual growth of 35 to 50%. "We source drug formulations, APIs and drug intermediates. India is a leading country in drug product-formulation outsourcing, although we are starting to see competition from other markets, including China."

The First Awakening

The potential of Indian manufacturing was first highlighted in a 2005 Confederation of Indian Industry (CII)-McKinsey report titled, "Made in India." According to the report, "In the past, India did not tap into its manufacturing exports potential to the fullest. Going forward, however, Made in India could become the next big manufacturing exports story." Chelliah of Astra Zeneca agrees with that prediction. "India would be much better off in anything that has value-add and needs precision, because of its technical capabilities and qualified manpower," he notes.

The McKinsey report predicted that the global trend to manufacture and source products in low-cost countries is likely to gain strength over the next decade, "particularly in the skill-intensive industries where India has a significant competitive advantage. If India were to take advantage of this trend, manufacturing exports could increase from US$40 billion in 2002 to approximately US$300 billion by 2015, leading to a share of approximately 3.5% in world manufacturing trade."

But the report warned that in order to be successful, Indian companies needed to "adopt a global mindset to build scale and achieve cost excellence; acquire market access rapidly, including using inorganic routes such as acquisitions where required; strengthen design and innovation skills; build a global or regional operating footprint, and master the ability to manage a world-class talent pool and organization."

Indian companies are now preparing to go the extra mile. A Capgemini-IDG research report titled, "Manufacturing in 2020," found that Indian companies "claim they will lead the pack in customer collaboration in 2020, a position they already say they hold. All the responding Indian companies say they already collaborate with customers at the R&D level. This could reflect the historical lack of manufacturing in India, and a strong national desire to 'catch up.'"

India's rise in the manufacturing arena has to come at somebody's cost -- namely, China's, experts say. China has built its economic fortunes over the past three decades with large-scale, low-cost outsourced manufacturing for global markets. But economists have long predicted that China will cede its outsourced manufacturing base to other developing countries as its working-age population declines in the coming decades. The country has periodically battled threats to its status as a low-cost manufacturing hub -- a designation that has been helped by massive investments in infrastructure, education and training, and state incentives.


The China Factor

Are China's problems a passing phase? "This is not a flash in the pan," says Marshall Meyer, a Wharton professor of management and sociology. "Efficient and younger-age factory workers have been in short supply." In addition, factory wages have risen around 50% in the country's southern provinces like Guangdong that lead the export juggernaut.

According to Meyer, the Chinese central bank's efforts to contain inflation by limiting liquidity aren't working as intended. "Inevitably there is leakage," he says, adding that money supply has risen 52% in the past two years. "This creates a very powerful inflationary force. One way or another, goods coming out of China will cost more ... [and business] will go where costs are lower." China's "weak spots" are in low-margin manufacturing such as garments, toys, pharmaceuticals and foods, some of which could head to Vietnam, Indonesia and Sri Lanka, he notes.

Lower costs alone will not tilt the scales, however. Many Western companies head to India for outsourcing manufactured parts and sub-assemblies because China lacks the required expertise. "We have been seeing increased activity in sourcing from India, primarily in components requiring some degree of complexity," says Ketan Chandarana, a partner at Synergy, a Bangalore-based consulting firm. Synergy advises mostly multinational firms in outsourced manufacturing. His clients prefer India also in cases that call for "sensitivity" to intellectual property rights and manufacturing in low-to-medium volumes with high degrees of variation in products.

Among Synergy's clients is a Canadian maker of high voltage electrical equipment that two years ago needed a wide variety of components but in volumes ranging from a few hundred pieces to tens of thousands. "They tried to source from China, but were not able to get the quality levels and attention to detail," Chandarana notes. The company now sources brass components from Gujarat and Karnataka.

India has traditionally had an edge in high-end manufacturing with lower volumes relative to China and design-intensiveness, according to Shah of IIMB. "India's problems are in low-end manufacturing, where wage costs play a role. Higher-end manufacturing is not that sensitive to wage costs." India will enhance its overall manufacturing competitiveness in the next five years, according to a June 2010 Deloitte study that gives China a current score of 10 in that area and 8.15 to India. Five years from now, however, the study projects India advancing to a score of 9, with China staying at 10. In addition to India and China, Korea, the U.S. and Brazil were ranked as Deloitte's top five countries in manufacturing competitiveness.


Investing in India

Global companies attracted to India's markets also realize they need to invest in local manufacturing for maximum advantage, according to Prabhudev Konana, a professor of business at the McCombs School of Business in the University of Texas at Austin. "You cannot tap a growing market by being outside. You want to be inside, closer to the market." All the major global automobile manufacturers, including General Motors, Ford, Nissan and Hyundai have invested in manufacturing in India with an eye on exports to third-country markets, he adds. It also helps that the Indian market "is very similar to a lot of Asian countries and Africa.... Roads are not wide and not designed for big vehicles."

Chinese companies are not sitting quiet as their outsourcing clients get restive. "Chinese companies and the state, [which are] often hard to separate from each other, are aware of the pressures on their competitiveness, most immediately from rising wages," says Tarun Khanna, a Harvard University professor and author of the 2007 book, "Billions of Entrepreneurs," which tracks entrepreneurship trends in China and India. China has responded with two "structural" solutions, Khanna adds. "The first is to encourage a 'Go West' policy to tap into the still incredibly-large labor pools available in the western part of the country, a process now underway for some time. The second is to compel foreign investors to disseminate technology to domestic companies, so that the local entities can begin to compete on non-price dimensions and move up the proverbial value chain."

Those new controls should be "serious food for thought" for multinationals entering China these days, according to Khanna. He also noted an increasing fear that foreign investors "will not be allowed to achieve critical scale in China." If MNCs get too big for comfort in China, the government could extend preferential treatment to local companies "to contain over-reliance on outside investors," Khanna says, a new approach that contrasts with China's pampering of foreign investors with tax and other incentives since seeking them out in 1980. China started phasing out incentives five years ago.

India's reluctance in earlier years to welcome foreign investments brought unintended benefits in grooming local manufacturing, according to a 2003 paper titled, "Can India Overtake China," written by Khanna and Sloan School of Business professor Yasheng Huang. They wrote that as the Chinese economy took off in the past two decades, "Few local firms have followed, leaving the country's private sector with no world-class companies to rival the big multinationals." By contrast, India "took a dim view of Indians who had gone abroad, and of foreign investment generally, and instead provided a more nurturing environment for domestic entrepreneurs. In the process, India has managed to spawn a number of companies that now compete internationally with the best that Europe and the U.S. have to offer."

A Second Sourcing Destination

Emory's Sheth offers four reasons for India becoming a second sourcing destination. For one, India's large market for everything from cars to cell phones will attract investments in capacities that will be used also to supply West Asia and Africa. Secondly, as China grows, it will "selectively divest low-end manufacturing to other parts of the world to protect its own resources." Third, by using modern manufacturing techniques to tap into its vast agricultural and industrial resources, India can lower costs and improve its competitiveness. His fourth reason: "India is becoming a strategic alliance partner with America," the world's largest market. He sees India and China sharing a common destiny along with America as partners.

Some of initiatives currently underway, including a plan to implement a uniform goods and sales tax and a direct tax code, could help boost India's manufacturing competitiveness, Shah of IIMB notes. Dedicated freight corridors along eastern and western India totaling 2,762-kilometer (1,716 miles) would increase freight movement capacity, although they are set to open no earlier than 2017. India's latest budget also allocates Rs. 500 crore (US$110 million) for the government's National Skills Development Fund, which has a target of providing job training to 500 million people by 2022. The University of Texas' Konana would like to see that implemented with missionary zeal. "For China, it is an obsession; they are training large numbers of people with passion. One CEO told me they are teaching English in stadiums in China."

China's latest challenges do not translate into automatic wins for India, warns Khanna. "Can India benefit from this re-calibration? In a sense, yes, but probably no more than before." The primary deterrent to investment in India "will be internal to India," he notes, listing "good infrastructure" and "low-hassle processes" as the chief inducements. Investors are also wont to make politically correct noises about the need for democratic institutions and transparent processes, but they sometimes ring hollow, says Konana. "Most U.S. companies love China because it provides stability. That is where I see the hypocrisy. India is a democracy but they don't like the uncertainty [that goes with the territory]."

Will India Match China's Manufacturing Might? - India Knowledge@Wharton
 
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hello_10

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India to spend USD 1 trillion on infrastructure in next 5 yrs
Nov 07 2012

India will spend USD 1 trillion on infrastructure development in the country over the next five years and 40 per cent of it will come from the private sector, Kamal Nath, Union Minister for Urban Development and Parliamentary Affairs said today.

"The Cabinet has approved an expenditure of USD one trillion in the next five years on Infrastructure Development and 40 per cent would come from private sector," he told members of the Indian Journalists Association at the India House here.

The minister was speaking after two rounds of meetings here with British investors yesterday and today.

The meetings follows the signing of a Memorandum of Understanding between the Ministry of Urban Development, Government of India and the Department for Business, Innovation and Skills, UK on Co-operation on Urban Regeneration and Development, a couple of months ago.

Kamal Nath said a three-day Seminar would be held in Delhi on the Infrastructure Development shortly.

At the Round Table meeting held yesterday, Kamal Nath said India has decided to built Metros in all cities with a population of more than two million.

Kamal Nath met the Mayor of London Boris Johnson yesterday and discussed among other things "heritage protection management".

Answering a question on Foreign Direct Investment (FDI), Kamal Nath said: "It was BJP which had put up a Cabinet note on FDI in 2004. Our effort is to bring about a consensus on the issue and I believe our political parties are responsible.

It is my effort to bring about a consensus on the issue."

Britain's Foreign Secretary, William Hague will be visiting India from November 8.

India's High Commissioner to the UK Jaimini Bhagwati is leaving for New Delhi tonight in connection with Hague's visit.

India to spend USD 1 trillion on infrastructure in next 5 yrs - Indian Express


Rs 51.46 lakh crore infrastructure outlay projected during 12th Plan

NEW DELHI: The Planning Commission is aiming at a total outlay of Rs 51.46 lakh crore in the infrastructure sector during the 12th Plan (2012-17), short of the earlier projection of USD 1 trillion (about Rs 55 lakh crore).

"The total investment during the 12th Plan is projected at Rs 51.46 lakh crore compared to Rs 27.74 lakh crore realised during the 11th Plan", a source privy to the development said.

While the public investment in the infrastructure sector is expected to decrease to 53.32 per cent in the 12th Plan from about 62.47 per cent in the previous Plan, the share of private sector is projected to increase to 46.68 per cent from 37.53 per cent.

Sources further said that infrastructure sector investment as percentage of the Gross Domestic Product (GDP) is expected to rise steadily to 10.40 per cent in the terminal year (2016-17) of the 12th Plan.

The average investment in infrastructure sector for the 12th Plan as a whole is likely to be about 9.14 per cent of the GDP as compared to 7.22 per cent during the previous Plan.

As per the details, the highest investment is envisaged in power sector at about Rs 15 lakh crore, roads follow at Rs 9.2 lakh crore, telecommunication at Rs 8.84 lakh crore and railways at Rs 4.56 lakh crore.

These proposals will be placed before the meeting of the Full Planning Commission to be chaired by Prime Minister Manmohan Singh on Saturday.

Although the Prime Minister in March 2010 had pegged the investment target for infrastructure sector during the 12th Plan at USD 1 trillion, the figures in dollar terms have to be revised in view of falling value of rupee.

Rs 51.46 lakh crore infrastructure outlay projected during 12th Plan - Economic Times
 
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