Comparing India and China. Who stands where? [ Updated 2022]


With the world economy shifting east with the rise of Asia; countries like Singapore, China, India, Japan and some of the middle-east countries are dominating the world economic activity. The profound transformation in these regions have led to the shift in economic power from western world to eastern region.

China and India are the center for this transformation. These two fastest growing economies are the major contender for the western word. World is very distinctive regarding these countries. These two super-growing economies are always head to head for gaining advantage and reflect one’s supremacy over others. India and China are always competing in every parameter; social , economical, political, defense, technology etc. Economists and Analysts have assumed that these countries are the future of this world.

China and India : Country Profile

India is one of the fastest growing economies and it is ranked 5th in the world leader ranking. New Delhi is the Capital of India and there are 29 states in India. With a population of 1,417,173,173 it is the second most populous country in this world. The geographical coverage of India is 3.287 million kmsq with 431.14 people living in per km sq area making it 29th most densely populated country.

China stands in second position in the world leader ranking. It is also one of the fastest growing economies. Beijing is the capital of Republic of China. There are 31 provinces in China and it is the most populated country in the world with the population of  1,450,690,148. The geography is extended 9.597 million km sq and population density of 151.16 per km sq.

World Rank5th2nd
CapitalNew DelhiBeijing
Number of States2931
Area3.287 million kmsq9.597 million kmsq
Population Density431.14 per kmsq151.16 per kmsq

China and India: Political Structure

India is the largest democracy in the world. Mr. Narendra Modi is the current Prime Minister and Ms. Droupadi Murmu is the President of India. India got independence on 15th August, 1947 from British Commonwealth. Currently, Bharatiya Janata Party is the ruling party.

China is a Communist country with socialist state form of political arrangement. China has a Presidential System without a Prime Minister. Mr. Xi Jinping is the President of China. China has a single party system and Communist Party of China (CPC) is the only party in the Republic of China. China got independent on 1st October, 1949 with the creation of the Republic of China.

Prime MinisterNarendra Modi
PresidentDroupadi MurmuXi Jinping
Ruling PartyBharatiya Janata Party (BJP)Communist Party of China (CPC)
Government TypeDemocraticCommunist
Independence15th August, 19471st October, 1949

China and India : Index Comparison

There are various indices which measure various parameters. These parameters compare various factors of a country and rank them accordingly. The Human Capital Index simply means the ability of a country to mobilize the economic and professional potential of its citizens. In the HCI report by the World Bank, HCI of India is 0.494 whereas HCI of China is 0.653. Higher value indicates better ability to mobilize its citizens.

Human Development index is another dimension to measure the well being in life of people. India has HDI of 0.645 and for China, HDI is 0.761. Higher value reflects the better position of the country. Similarly, HDI Rank and World Happiness Index(WHI) Rank suggest that China has a better position than India. China is ranked 82th for WHI and India is down to 136th rank. Similarly, Life Expectancy rate of China is 77.30 years and also, China is among the leading countries with a higher age group of population. For India, Life Expectancy ratio is 70.19 years.

When it comes to innovation, China is the hub for tech-subsidiaries from all over the world and India is desperately growing its hold in tech-human capital. The Global Innovation Index Rank of India is 46 and for China is 12. Similarly, China has behind ranking in Economic Freedom better in Global Peace Index (GPI).

Human Capital Index World Bank0.4940.653
Human Development Index UNDP 20220.6450.761
HDI Rank UNDP 202013185
World Happiness Index Rank 202213682
Life Expectancy World Bank 202270.19 years77.30 years
Global Innovation Index 20214612
Economic Freedom Index 2022131158
Global Peace Index 202213589

China and India: Economic Review

China is ranked second in the world ranking. It is a huge economy. The National GDP of China is $17.46 trillion which is almost 6 times the Indian economy. India has a National GDP of $ 3.173 trillion. India has leverage in growth rate. The GDP growth rate of China is 8.10% whereas India is ahead of China with the growth rate of 8.9%. Inflation in India is 5.52% which is higher than the inflation in China, which is 2.1%.

GNP per capita of China is almost three times the GNP Capital of  India. India has GDP per capita of $ 2,277.43. India falls in the category of Lower Middle Income Country and China stands in Upper Middle Income Country. India has a lot to do to upgrade its position in the world map. The greater disparity among rich and poor in Indian economy is the biggest challenge for such low rank and this disparity is increasing.

Nominal GDP World Bank 2021$ 3.173 Trillion$ 17.46 Trillion
GDP Growth World Bank 20218.10 %8.90 %
Gross National Income per capita UNDP 2019$ 2,277.43$12,556
GDP Per Capita 2020$ 2,278$ 12,556
Inflation World Bank 20218.9 %2.1 %
Export share in GDP World Bank 202120.814 %20.01 %
Import share in GDP World Bank 202122.86 %17.422 %
Income LevelLower-middle Income CountryUpper-middle Income Country
Unemployment 20228.2 %4.82 %

China and India: Business Environment

We live in a globalized economy and there is freedom of performing economic activities across the world. Business environment of a particular country is a very strong determinant factor of its position in the world economy. Business is the actual driver of an economy.

China is ranked 31st in both Ease of doing business and Starting a business where India is on 63rd position in both the parameters. The total export figure in 2022 for China is $3.54 trillion, hence China is an export based economy. India has a total export value of $ 660.50 billion in 2021. Chinese export business is 6 times larger than export business in India.

China is ahead in FDI inflows and outflows which suggest the better environment for businesses outside the country to invest in China. India is just opening for foreign investors. India is liberalizing its policy to attract foreign investment. Similarly, Greenfield Investment in China is double the investment in India in 2018.

Similarly, the rank of China for Startup Ecosystem is 4th and Beijing is Chinese entrepreneurial hub. India is ranked 26th in the same category and Bangalore, a city in India is the startup hub for India.

Similarly, the capital market of India is worth $3.46 trillion and for China the capital market value is about double of India i.e. $12.2 trillion. Mr. Mukesh Ambani is the richest person in India with worth $90.7 billion and Mr. Zhong Shanshan is the richest person in China with a worth $ 75.1 billion.

Total Export 2021$ 660.50 billion$ 3.54 trillion
Ease of doing business 20216331
Starting a business 20216331
FDI Inflows 2021$ 83.57 billion$ 181 billion
FDI Outflows 2021$ 1.569 billion$ 153.71 billion
Greenfield Investment
Capital Investment 2021
$ 23.5 billion$ 29.7 billion
Startup Ecosystem Ranking GLOBAL STARTUP ECOSYSTEM REPORT 202022nd (Bangalore)5th (Beijing)
Total Stock Market Value 2020$ 3.46 trillion$12.2 trillion
Richest PersonMukesh Ambani $ 90.7 billionZhong Shanshan $ 75.1 billion

China and India: Reserve Comparison

Reserves are necessary for international upfront. Reserves are necessary for any business transaction and also reserves reflect the position in international business forums. China has foreign exchange reserve of $ 3.48 trillion and India has this reserve worth $ 593.32 billion. Similarly, gold reserves with China are three times more than reserves with China. China has gold reserves of 1948.31 tons and India has reserves of 501.8 tons. National Debt in 2020 for India is only $ 2.35 trillion and for China is $ 7 trillion.. Growing and expanding economy generally has higher National debt.

Foreign Exchange Reserve 2021$ 593.32 billion$ 3.48 trillion
Gold Reserves 2021501.8 tons1,948.31 tons
National Debt 2020$ 2.35 trillion$ 7.00 trillion
External Debt 2021$ 620.7 billion$ 2.72 trillion

China and India: Defense Position

China and India are two powerful nations when it comes to defense and weapons. China is ranked in 3rd position in overall defense  and India right behind China. The annual defense budget of India is $72.86 billion in 2020 and for China this figure was $ 252.30 billion. China has the defense strength of 2,185,000 active personnel and 1,455,500 active personnel in India. India is ranked 4th in Army strength and Air force strength and 6th in Navy global rank. Similarly, China is ranked 2nd in Army strength, 3rd in Air force and 4th in Navy global rank.

Defense Budget 2021$ 76.6 billion$ 293 billion
Basic Defense Rank 202143
Army Global Rank 202142
Air Force Global Rank 202143
Navy Global Rank 202164
Total Active Personal 20211,455,5002,200,000



Leave a Comment