China’s Economy

 Economic system is called as "market socialism”, “

state capitalism" and a "market-oriented mixed
economy under one-party rule." 
 The one of the fastest growing economy in the
world.
 2nd largest economy in terms of purchasing power in
2004.
 History
 People’s republic of china was formed in 1949.
 In 1978 china introduced farm reforms.
 In 1984 china introduced reforms to their cities
designed to create a “Socialist market economic
system”.
 In 1987 set a goal to double the nation’s GNP from
1980.
 Then set a goal to quadruple the nation’s GNP from
1980 by the year 2000.
 Privatisation
 In China, the green signal was given by General
Secretary, Mr Jiang Zemin, in September 1997.
 Since receiving the green signal from Mr Jiang in
1997, China has made rapid progress in its
privatisation efforts. In only two years (1997 and
1998), 19,660 state-owned enterprises in the
industrial sector were privatised and 17,990
thereafter. Privatisation was faster in inland areas,
accounting for over 60 per cent of the total.
 Exports & Imports
 4th largest exporting country.
 3rd largest importing country.
 Year-on-year Absolute Value Year-on-year
Absolute Value
  growth % for for first 11 growth % for
for November
November months first 11 months

Export Value 1533.3 34.9 14238.4 33.0

Import Value 1304.4 37.7 12534.3 40.3

Total
Import and 2837.6 36.2 26772.8 36.3
Export Value

Import and
228.9 20.7 1704.1 -3.9
Export Balance
 FOREIGN DIRECT
INVESTMENT OF CHINA
FDI has accounted for only 3-5 per cent of GDP in
China since 1990, and at its peak was 8 per cent.
In the year 2000 FDI growth was 6 percent
 FDI of 10 Top countries

Country/Region of Amount Invested Amount Invested Year-on-Year

Origin 2008 2009 Growth**
($ billion) ($ billion) (%)
Hong Kong 41.0 54.0 31.6
Taiwan 1.9 6.6 245.7
Japan 3.7 4.1 12.7
Singapore 4.4 3.9 -12.4
United States 2.9 3.6 21.5
South Korea 3.1 2.7 -13.8
United Kingdom 0.9 1.5 60.7
Germany 0.9 1.2 36.3
Macao 0.6 1.0 71.9
Canada 0.5 1.0 76.5
 China economic models are :-
 Post-communist emerging market
 East Asian development state
 Liberal free-market state
 China banking system
The central bank of the People's Republic of China
 is the People's Bank of China.
The "big four" state-owned commercial banks are
the Bank of China, the 
China Construction Bank, the 
Industrial and Commercial Bank of China and
the Agricultural Bank of China.
In the past few years, the Chinese government has
been pursuing an active fiscal policy to finance key
construction projects by issuing government debt.
Meanwhile, sound monetary policy has been
implemented in coordination with the fiscal policy.
Since the beginning of 2002, the People’s Bank of
China (PBC) has been pursuing sound monetary
policy while promoting policy efficiency.
 MONETARY POLICY
In the light of the current situation at home and abroad, the
PBC will:
• use monetary policy instruments in a flexible manner to
adjust money supply appropriately and maintain reasonable
growth in credit aggregates;
• promote the reform of the interest rate mechanism, and
bring interest rates into full play in adjustment of the demand
and supply of funds, as well as in the optimization of
resource allocation;
• improve the incentives applying to lending and corporate
governance of commercial banks;
• and improve the RMB exchange rate formation system
under the precondition of preserving the stability of the RMB
exchange rate.
 FISCAL POLICY
The Chinese government continued to pursue a
proactive fiscal policy to boost domestic demand. In
the first three quarters, fiscal revenue increased by
10.9% and expenditure by 17.6%, which is under the
budget limits. Owing to the slowing revenue and
increasing expenditure, there is little room for
further fiscal deficit reduction.
• customs tariffs were reduced from 15.3% to 12% in line
with China’s WTO commitment;
• the impact of lowering the securities stamp tax rate
became increasingly evident in 2002;
• the banking and insurance business tax was further
lowered by 1 percentage point in 2002.
The increase in expenditures is caused by the following
factors:
• continued investment in projects funded by government
bonds, western region development and technical
innovation;
• more resources directed to the social safety net;
• wage increases for civil servants;
• increased investment in agriculture, science and education.
 CHINA V/S INDIA
Making an in depth study and analysis of India vs. China
economy seems to be a very hard task. Both India and China
rank among the front runners of global economy and are
among the world's most diverse nations. Both the countries
were among the most ancient civilizations and their
economies are influenced by a number of social, political,
economic and other factors. However, if we try to properly
understand the various economic and market trends and
features of the two countries, we can make a comparison
between Indian and Chinese economy
Facts India China
around $1.3123 around 4909.28
GDP
trillion billion
GDP growth 8.90% 9.60%
Per capital GDP $1124 $7,518
Inflation 7.48 % 5.1%
Labor Force 467 million 813.5 million
Unemployment 9.4 % 4.20 %
Fiscal Deficit 5.5% 21.5%
Foreign Direct Investment $12.40 $9.7 billion
Gold Reserves 15% 11%
Foreign Exchange
$2.41 billion $2.65 trillion
Reserves
World Prosperity Index 88Th Position 58th Position
Mobile Users 842 million 687.71 million
Internet Users 123.16 million 81 million.
Thank You