an analysis for india and china - icrier

7.4 India-China: Comparative Analysis
7.4.1 Factor Intensity
Two Digit Level
The resource and labour intensive manufactured commodities hold the dominant
share in India and China’s comparative advantage in the manufacturing sector. China’s
share of labor and resource intensive commodities of the total manufacturing sector
increases marginally from 39 per cent in 2000 to 43 per cent in 2003. In contrast, India’s
share of the resource and labor intensive of the total manufacturing sector decreases from
39 per cent in 2000 to 37 per cent in 2003.
For both India and China science- based industries contribute less than 10 per cent
of the comparative advantage in the manufacturing sector. While for India only about 5
per cent of the total manufactured products with comparative advantage can be
characterized as science based in both 2000 and 2003, this percentage is greater in China.
Science based manufactures constitute 7 per cent of China’s comparative advantage in
the manufacturing sector in 2000 as well as 2003. In absolute terms, China’s science
based industries is double the number in India. For 2000, there are 121 science based
Industries in China in comparison with only 57 in India. In 2003, this number increases to
67 for India and 125 for China. Within the science-based manufactures India and China
are advantageously placed in same commodity sectors. In terms of the number of
manufactures in these sectors, China outscores India in all the sectors, except for
medicinal and pharmaceutical products, in which India marginally exceeds China. In fact
for India, medicinal and pharmaceutical products is the predominant category, while in
China - photographic apparatus, equipment and optical goods dominates. In the leading
science- based category China enjoys more than double the comparative advantage that
India does in the same industry category. China’s advantage in the leading science based
industry is much stronger (in terms of the number of commodities) than that of India’s in
its leading science based industry. India has lost its distinct comparative advantage in
aircraft launching gear; deck-arrestor or similar gear; ground flying trainers; parts of the
foregoing in 2003. China on the other hand has gained comparative advantage in the
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