Question

Compare and contrast India and China’s sectoral contribution towards GDP in 2003. What does it indicate?

Answer 1

The comparison of India’s and China’s sectoral contribution towards their respective GDP can be done with the help of the data tabulated below:

Sectors	Contribution to GDP (in %) (2003)
Primary (Agriculture) Secondary (Industry) Tertiary (Service)	India 23 26 51	China 15 53 32

1. Contribution of Primary Sector to GDP: The data above reveals that the contribution of the primary sector to India’s GDP is 23% compared to 15% of China’s GDP. This confirms the agrarian nature of Indian economy.
2. Contribution of Secondary Sector to GDP: The data also reveals that China has comparatively a strong industrial base as compared to India. The contribution of secondary sector to China’s GDP is 53% against the contribution of mere 26% to India’s GDP. From this, we can infer that India’s industrial sector is far behind that of China.
3. Contribution of Tertiary Sector to GDP: We can also analyze that although India’s industrial sector is not as strong as that of China yet the contribution of India’s service sector is much stronger to its than that of   China.

Thus, analysing the above data helps us to conclude that a significant portion of India’s GDP is contributed by tertiary sector followed by its agriculture sector. On the contrary, the major contributor to China’s GDP is the secondary sector followed by its tertiary sector.       

The process of economic growth has led to a tremendous shift in the sectoral share of output and employment. The percentage share of the primary sector in total output and employment tends to decrease while that of the secondary and tertiary sector tends to increase. The following facts explain the sectoral share in output and employment of India and China.

i. Both India and China have shown a noticeable structural transformation from the primary sector to other two sectors. The primary sector in both the countries is no longer the important contributor to the nation’s GDP.

ii.While India is relying more on its tertiary sector China is relying more on its secondary sector in terms of thesectoralcontribution to their GDP. The experience of China is similar to that of the other developed countries in the world. The experience of the developed countries shows that secondary sector followed by the tertiary sector emerge as the leading sectors of the economy. Compared to China, India showed a direct shift from the primary sector to tertiary sector. This is due to the fast integration of these two economies with the other market economies of the world.