As India’s economy showed vigorous development tendency last year, some Western scholars consider that India will exert competitive pressure on China since India has the same population advantage as China. Moreover, some people pointed out that population advantage will help India and China to be among biggest powers in the world in the future. I don’t deny the advantage of population for China’s and India’s economy, but if we see only what is under our nose, we may fall into the “advantage trap” set by some Western experts.
The latest data from the World Bank shows that in 2013, the population of China was 1.357 billion, and for India, the population was 1.252 billion. Besides, China’s population is growing at the rate of 0.5% every year, and the growth rate of India’s population is 3 times faster than that of China. At this rate, India will exceed China in population in about 10 years and become a country with largest population in the world. Seen from the demographic structure, India is a young country. However, China has entered a rapid aging process. Thus the forecasts that India’s economy will have stronger growth impulses than China in the future. This kind of judgement based on the advantage of work force misses the new situation and stage the world is experiencing and the core factors driving the growth of the new economy.
First, the world is now experiencing a new technological revolution featuring cloud computing, Internet, intellectual manufacturing, etc. Under this circumstance, knowledge, information, and so on have become new and fundamental in production. Traditional factors of production represented by labor force are facing challenges and will become less influential in fostering economic growth.
Second, China has entered the age of industrial robots. There’s a trend that factory workers will be replaced by machines. As the cost of work force is increasing, industrial robots will replace workers. Taking the example of Foxconn, it has thousands upon thousands of robots functioning. Some small enterprises are also trying to use robots rather than human forces.
Third, judging from of the history of the rise of big powers, the reason for the rise of countries such as Portugal, Spain, Netherlands, Britain, America, etc. is that they caught up with and seized the opportunity created by some special world trends such as technology revolution and discovery of new lands. They were not leaders of their time in population advantage. Therefore the key to the contest between countries depends on whether they can seize the opportunity of major technological developments and historical opportunities. The population and other natural resources are only auxiliary.
(Zhao Xijun is a vice researcher of the Modernization Research Center of Chinese Academy of Sciences)
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