Competitiveness is defined as the set of institutions, policies and factors that determine a country’s level of productivity. The level of productivity, in turn, sets the level of prosperity that can be reached by an economy.The GCI combines 114 indicators that capture concepts that matter for productivity. These indicators are grouped into 12 pillars- institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market development, technological readiness, market size, business sophistication, and innovation. Effective modes of transport—including high-quality roads, railroads, ports, and air transport, uninterrupted electricity supplies, solid and extensive telecommunications network ensures the effective functioning of the economy.
Published in Chapter:
Trade Liberalization, Infrastructure Development, and FDI in India and China
Rajib Bhattacharyya (Hooghly Mohsin College, India)
Copyright: © 2017
|Pages: 27
DOI: 10.4018/978-1-5225-2361-1.ch013
Abstract
The two largest economies in Emerging Asia, China and India, are considered to be the ‘power houses' of global economy. China and India adopted the policy of ‘opening up to the outside world' respectively in 1978 and 1991. Trade openness and infrastructure development has been acknowledged as crucial pre-conditions for attracting foreign direct investment (FDI). China's path of development was guided by the so called fast growing nations, which laid substantial emphasis on building strong infrastructural base at great speed. But India, on the other hand did not adopt the strategy of building infrastructure base prior to the growth of demand, like the one which has been followed by most successful Asian countries achieving rapid infrastructure development. So early opening up and improved infrastructure has attracted more FDI in China than in India. So the present study seeks to examine the relationship between trade liberalization, infrastructure development and FDI inflows in India and China using secondary time series data in a comparative analytical framework.