Chapter 8: Comparative Development Experiences of India and Its Neighbours

Regional and economic groupings are formed by countries to understand the development strategies and growth measures that are used by the other member countries. This helped countries to analyse the strength and weaknesses they possessed and the corrective measures that needed to be taken to bring in growth and prosperity. Forming a regional group also makes countries maintain peace among themselves and having a common platform for trade as well as a representation on the World Forum.

The following are the means by which countries are trying to strengthen their own domestic economy:

1. By forming regional and economic groupings like European Union (EU), SAARC, ASEAN, OPEC, and G-8 etc.

2. By analysing the development model and strategies adopted by member countries in order to boost the economy of the country.

3. By liberalising the economies, which reduces government intervention in economic activities, the economy is governed by the demand and supply of the market.

4. By opening their economy to the world, which is known as globalisation. It is a move to provide the scope of business in the international market for domestic products.

The developmental strategies followed by India and Pakistan are as follows:

1. Developmental programmes adopted by both countries were based on economic planning.

2. For growth and development, the public sector was selected as the medium of choice.

3. A mixed economic structure was followed by both countries, which involved public and private sector participation.

4. Economic reforms were introduced at the same time to strengthen their respective economies.

Great Leap Forward was a campaign started by communist leader Mao Zedong in 1958. It had the following objectives:

1. To initiate industrialisation of the economy in urban as well as rural areas.

2. Motivating people to set up industries in the backyard.

3. Engaging rural people in collective farming under the Commune System.

The rapid industrial growth of China is attributed to the economic reforms that were introduced in phases in 1978. The first phase started with developments made in agriculture, investment and foreign trade. For agriculture commune system was introduced in which small plots were allocated to individual households. Income generated from the land can be kept by the households after paying the tax to the government. The next phase of reforms started with the industrial sector, where private firms were encouraged to compete with government-owned enterprises. A system of dual pricing was introduced in which farmers and industries need to buy and sell a fixed quantity of inputs and outputs at government-fixed price and trade remaining quantities at market price. Also introduced were special economic zones that were designed to attract foreign investment.

The following initiatives were taken by Pakistan for its economic development:

1. Adopted the mixed economy model where both public and private sectors exist.

2. Introduced regulatory frameworks during the 1950s-60s, where domestically produced goods were used as substitutes for imports, which helped develop domestic industries.

3. Mechanisation of agriculture to bring about the Green Revolution leading to the production of food grains.

4. Capital goods industries were nationalised in the 1970s.

5. The important thrust areas were denationalised, which encouraged private-sector participation.

The important implication of one child norm led to low population growth and a decline in the sex ratio in China. It meant a lower proportion of females per thousand males.

The important demographic indicators are shown below: