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Comparative Development Experiences of India and its Neighbours Class 12 Notes

Category	CBSE Economics Class 12 Notes
Subject	Economics
Topic	Comparative Development Experiences of India and its Neighbours Introduction

Comparative Development Experiences of India and its Neighbours Class 12 Notes are provided for the aid of students to assist them with fast learning. These notes ensure a simple and easy understanding of the text. The notes help students to compare, analyze and criticize the development path taken by India and its two neighbors i.e. Pakistan and China.

Introduction
The development path of China
The development path of Pakistan
Similarities in the development path of all three countries India, China, and Pakistan
Comparisons of demographic indicators
Comparison of GDP, the growth rate of GDP, and sectoral contribution
Human development indicators

Comparative Development Experiences of India and its Neighbours Introduction

India, Pakistan and China have many similarities in their developmental strategies. Every country has been trying to adopt various means to strengthen their domestic economies;

They are forming various regional and global economic grouping such as the EU (European Union), ASEAN Association of Southeast Asian Nations), BRICS (Brazil, Russia, India, China, and South Africa), GR and G-20, etc.
They are also trying to understand know the development policies and strategies pursued by their neighboring countries to realize/ analyze their strengths and weakness because, in the process of globalization, they are facing competition not only from developed countries but also from other developing countries.

The development path of China – Comparative Development Experiences of India and its Neighbours Class 12 Notes

China has one of the world’s oldest people and continuous civilizations. It is situated in eastern Asia, bounded by the Pacific in the east and the third-largest country in the world, next to Canada and Russia, with an area of 9.5 million square kilometers.
It is the most populous country in the world with 134,76 crores people (as per 2011 estimates).
After the establishment of the People’s Republic of China on 1 October 1949 under one-party rule, all the critical sectors of the economy, enterprises, and lands owned and operated by individuals were brought under government control
Immediately after the revolution of 1949, the Chinese economy system was declared as a communist system, and the other economy became a command economy or centrally planned economy like that of the Soviet.
The development path of the Chinese economy can broadly be divided into two periods:

The Mao period or pre-reform period (1949-1976)
The post-Mao period or the reform period (1976 onwards)

The Mao period or pre-reform period 1948-1976

The Mao period is characterized as a Soviet-style planned economy because it abolished/ removed the market system or price system and all critical sectors were brought under government control which was earlier operated and owned by individuals. China started planning development strategies and announced its first Five Year Plan in 1953.

Following policies pursued in the Mao period:

(A) Great leap forward campaign

The great leap forward campaign was initiated/ launched in 1958 by Mao to modernize China’s economy. Initially, China’s economy was agrarian and the basic aim of this campaign was to transform the agrarian economy into a modern economy through the process of rapid industrialization.

Under this program/ campaign, people were allowed/ encouraged to set up industries in their backyards to achieve the aim of industrialization at a massive scale.

Problems faced by GLF

A severe drought caused havoc in China killing 30 million people.
Withdrawal of Russian professionals by Russia due to conflict between China and Russia who had been helping China in its industrialization.

(B) Commune system

In order to increase agriculture production and productivity and modernize the agriculture sector, the commune system was launched/ started in 1958) in rural areas.

Commune means collective cultivation of lands, so under this system people collectively cultivated lands. In 1958, there were 26,000 communes, covering almost all the farm population.

(C) Great Proletarian Cultural Revolution

In 1966-67, Mao Tse Tung introduced the Great Proletarian Cultural Revolution, under which students and professionals were sent to work and learn in the countryside (different parts of the country).

Its basic aim was to weed out people opposed to the communist ideology. This revolution resulted in hardship for the people and a large number of people were also massacred.

Besides it, to support rapid industrialization, the central government undertook large-scale investment in physical and human capital during 1960. As the result, by 1978 nearly three-fourths of industrial production was

produced by centrally-controlled state-owned enterprises and private enterprises and foreign enterprises were nearly non-existent. The main goal was to make China’s economy relatively self-sufficient.

The post-Mao period or the reform period 1976 onwards

The present-day fast industrialization growth in China can be traced back to the reforms introduced in 1978.

The reforms were introduced in the followings phases;

(A) Initial/first phase

Reforms were initiated in agriculture, foreign trade, and investment sectors.

In the agriculture sector, commune lands were divided into small plots and allocated to the individual households for cultivation. They were allowed to keep all farm income after paying taxes to the government but they were not given ownership rights over these plots.

In the industrial sector, private sector firms and village enterprises were allowed to set up manufacturing units and produce goods that were earlier reserved for state-owned enterprises. The basic aim was to create a competitive environment and to achieve the objective, state-owned enterprises were made to face competition for enhancing efficiency and productivity.

To attract foreign investment, Special Economic Zones (SEZ) was set up.

(B) In the later phase

A dual pricing system was introduced. Under this system, farmers and industrial units were required to buy and sell fixed quantities of inputs (raw material) and outputs based on prices fixed by the government, and the rest were purchased and sold at market prices in the open market.

The development path of Pakistan – Comparative Development Experiences of India and its Neighbours Class 12 Notes

The development path of Pakistan has been described under the Comparative Development Experiences of India and its Neighbours Class 12 Notes as follows;

Pakistan, officially the Islamic Republic of Pakistan, gained independence on 14 August 1947. In 1971, a civil war in East Pakistan resulted in the independence of Bangladesh. Pakistan is the sixth most populous country in the world with 17 crores people and has an area of 7, 96,095 square kilometers.

After gaining independence in 1947, Pakistan also followed a mixed economy model with the co-existence of public and private sectors.
In the late 1950s and 1960s, Pakistan introduced a variety of regulated policy framework for the growth of domestic industries. The policy combined tariff protection with direct import control.
Pakistan started planning its development strategies and announced its first Five Year Plan in 1956.
In the agriculture sector, the introduction of the green revolution and increase in public investment in infrastructure led to mechanization and a rise in food grain production. This changed the agrarian structure dramatically.
In early 1970, capital goods industries were nationalized.
In late 1970, there was a shift in government policy when it adopted the policy of denationalization. The government encouraged the private sector and offered various incentives to create a conducive climate for new investment. Besides it, during this period, Pakistan received financial assistance from western countries and remittances from emigrants (Pakistani workers settled in the Middle East) to the Middle East. This all helped in accelerating economic growth and creating a favorable environment for new investment.
In 1988, reforms were initiated in the country into various sectors.

Similarities in the development path of all three countries India, China, and Pakistan

Comparative Development Experiences of India and its Neighbours Class 12 Notes state the following similarities in the development Path of these three nations.

All three started development paths at the same time. While India and Pakistan gained independence in 1947. The Republic of China was established in 1949.
All three countries started planning their development strategies in similar ways. While India announced its first Five Year Plan in 1951, Pakistan announced its first Five Year Plan in 1956 and China announced its first Five Year Plan in 1953.
All three economies introduced reforms. Reforms introduced in India in 1991, in China in 1978, and Pakistan in 1988,
Initially, all three countries adopted similar strategies such as creating a large public sector and raising public expenditure on social development.
Until the 1980s, all three countries had similar growth rates and per capita income.

Comparisons of Demographic Indicators

Comparative Development Experiences of India and its Neighbours Class 12 Notes use the following demographic indicators to compare the three countries.

1. Population size

China is the most populous country in the world with 134 crore population which is 19.4% of the total world population. India is the second most populated country with 121 crore which is about 17% of the total world population. population. The population of Pakistan is very small/ less i.e. about 17 crore which is 2.5% of the total world population and it accounts for roughly one-tenth of China or India.

Out of every six persons living in the world, one is an Indian and another Chinese.

2. Growth rate of population

In Spite of being the most populous country in the world, China’s population growth rate (0.47%) is lower than India’s (1.7%) and Pakistan’s (2.5%). The reason behind the lowest growth rate of population is the “One Child Policy” introduced by China in 1979. It has successfully reduced the rate of population growth from 1.33 % in 1979 to 0.64% in 2005 and further 0.47% in the recent past.

3. Density of Population

Density refers to the number of persons living per square kilometer of land area. The density of population in China is the lowest (146) as compared to India (441) and Pakistan (245)

Reasons behind lowest population density:-

(a) China is the third-largest country and also largest among three with 95, 61,000 square kilometers area, followed by India with land area 32, 68,090 square kilometers and Pakistan is the smallest country with land area 8, 03,944 sq km.

(b)Lowest growth rate of population.

4. Sex Ratio

Due to the preference of sons, the sex ratio is low and biased against females in all three countries. The sex ratio is the lowest in China with 926 females per 1000 males and corresponding figures in India and Pakistan, are 940 and 943 females per male. It points to social backwardness and female foeticide is the principal cause of the low sex ratio.

5. Fertility Rate

It is defined as several children borne by a woman in the reproductive age of 15-45 years on average. The fertility rate in Pakistan is highest with 5.1 in comparison to 3 in India and 1.8 in China. Due to introduction

6. Urbanization

It is closely linked with structural transformation in the country and is a consequence of a shift of the workforce from the agriculture sector to the industry and service sector. Both Pakistan and China have relatively higher rates of urbanization as compared to India. In India, 30% of the population is urbanized compared with 47% in China and 36% in Pakistan.

Comparison of GDP, the growth rate of GDP, and sectoral contribution

GDP (PPP)

GDP refers to the total value of final goods and services produced in the domestic territory of a country during one year. China has the second-largest GDP (PPP) of 7.2 trillion dollars whereas India’s GDP (PPP) is 3,3 trillion dollars and Pakistan’s GDP is roughly about 10% of India’s GDP.

GDP growth rate

When many developed countries were finding it difficult to maintain a growth rate of even 5%, China was able to maintain near double-digit growth for more than two decades. Until 1980, the economies of India, China, and Pakistan were growing slowly about 4% per annum.

(A) There was a marginal rise in China’s growth rate from 10.3% to 10.9%

(B) Pakistan also experienced a marginal rise from 5.3% to 5.8%

Sectoral contribution

It refers to the contribution (percentage share) made by each sector of the economy i.e. primary, secondary, and tertiary.

The historical experience of developed countries shows that an economy develops first the industrial sector and later the service sector but the experience of India and Pakistan has been different. In both countries, there has been a direct shift from the primary to the services sector.

(A) In both India and Pakistan, the service sector is emerging as a major player in development. The service sector contributes the highest to their GDP, with a contribution of 55.6 % in the case of India and 53.4% for Pakistan. But the contribution of the service sector to the GDP in China is 43.6%.

(B) In China, the contribution of the secondary sector is highest to GDP at 46.8 % whereas, in India and Pakistan, it contributes. in India and Pakistan 26.3% and 25.4% respectively.

Reasons:- GLF campaign launched in 1958 and reforms in 1978.

(C) Contribution of agriculture/ primary sector in India is 18.1% and in Pakistan is 21.2% whereas its contribution in China is only 9.6%.

(D) China’s growth is led by the industrial sector whereas the service sector is playing a dominant role in the growth of Pakistan and India.

Human Development Indicators

The human development index is one of the most important indicators to study the human development of a country.

This index was introduced by the United Nations Development Programme (UNDP). The first Human development

The report was prepared under the guidance of Mahbub-ul-Haq and published in 1990. It is a composite index of such indicators as life expectancy, infant mortality rate, maternal mortality rate, per capita income (PPP), poverty, sanitation, drinking water, etc. which is used to measure the performance of a country in social and economic development.

Some Selected Indicators of Human Development, 2017-2019

Indicators	India	China	Pakistan
Human Development Index (Value)	0.645	0.761	0.557
Rank (based on HDI)	130	87	154
Life Expectancy at Birth (years)	69.7	76.9	67.3
Mean years of Schooling (% aged 15 and above)	6.5	8.1	5.2
Gross National Income per capita	6681	16.057	5005
Percentage of People living Below Poverty Line (National)	21.9	1.7	24.3
Infant Mortality Rate (per 1000 live births)	29.9	7.4	57.2
Maternal Mortality Rate (per 1 lakh births)	133	29.	140
Population using at least basic Sanitation (96)	60	75	60
Population using at least basic drinking	93	96	91
Percentage of undernourished children	37.9	8.1	37.6

Reasons for re-emergence of poverty and slow growth rate in Pakistan.

Growth in agricultural and food supplies is based on good harvests, not on an institutionalized process of technical change. As a result, agricultural performance remains unstable and highly vulnerable to climatic conditions.
For its foreign exchange needs, Pakistan mainly relies on foreign remittances and volatile agricultural exports.
Lack of political stability.
Growing dependence on foreign loans and the increasing difficulty of paying back the loans with interest.
Huge allocation of funds for non-development activities like defense and reduction in development expenditure.

Comparative Development Experiences of India and its Neighbours Class 12 Notes gives a detailed understanding and comparison of the text which deals with the development path followed by three nations i.e India, China, and Pakistan after independence. The chapter also analyses the developmental status of the three countries in the present world and compares them.

CBSE Class 12 Economics Notes Term II Syllabus

Part A: Introductory Macroeconomics

Part B: Indian Economic Development

Current challenges facing Indian Economy – 12 Marks

Development Experience of India – A Comparison with Neighbours – 6 Marks

- Comparative Development Experience of India and its Neighbours Class 12 Notes

Comparative Development Experiences of India and its Neighbours Class 12 Notes