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Production networks in China and India : a comparative analysis
Economic Change & Restructuring
  • K. C. FUNG, University of California, United States
  • Hsiang Chih HWANG, Lingnan University, Hong Kong
  • Francis NG, The World Bank, Washington
  • Jesús SEADE, Lingnan University, Hong Kong
Document Type
Journal article
Publication Date
  • India,
  • South Asia,
  • China,
  • Production hubs

In this paper, we examine and compare the two important production hubs in Asia: China and Greater China and India and South Asia. We show that in China, Hong Kong and Taiwan, manufacturing trade has continued to be highly relevant, with trade in parts and components growing in importance. In contrast, in India, Pakistan and Sri Lanka, trade in parts and components remain limited. We then calculate various revealed comparative advantage (RCA) indices, which China having more components with RCA values exceeding one. Some of the most important components exported by China include electronic parts and telecommunication parts. One explanation is to why India is relatively weak in parts and components trade is that India is strong in service trade. Other reasons may be related to better port infrastructure, higher research and development intensity and higher educational enrollments in China.

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Citation Information
Fung, K. C., Hwang, H.-C., Ng, F., & Seade, J. (2013). Production networks in China and India : a comparative analysis. Economic Change & Restructuring, 46(1), 45-69. doi: 10.1007/s10644-012-9133-4