Development Compare Between China And India In Economics And Foreign Trade And Prospect For Their Cooperation

China and India have made great achievement in economy and foreign trade upon which our world has fixed eyes in these years by economic reform, though they have different histories and backgrounds. These two countries are neighbors and both have large quantity of population, so the tremendous potential market and geographic advantage have offered them the favorable basement to develop cooperation in economy and trade. And fully cognition about the mutual-complementary effect between the economy of China and that of India which leads to positive cooperation will highly improve their competitiveness and expand their influence in Asia even in the world. This article has deeply explored the potential of enhancing that kind of cooperation between them, both basing on the situations of their economies and the analysis of their predominance and inferior position, and proposed several relevant propositions as well.The first part has made a generally compare of the overall national strengths and the industrial structures of these two countries in four aspects including GDP,agriculture,industry and service industry. Both of China and India have rapidly developed their economies from the 1990s` in the 20th century. The average economic growth rate of India is 5.8% from 1991 to 2003 which is much lower than that of China 9.7%. However the growth rate of population in India is much higher than that of China and this has brought a big gap in the Average GDPs of the two countries. The growth rate of Average GDP of China is 8.7% from 1991 to 2003, while India is only 4%. And up to 2003, the Average National Income of China is 1100 $ and that of India is 530 $. So we can learn that China is much richer than India.China and India both have advantage in agriculture, but they have different emphasis on industry and service industry. The proportion of industry in China and India is 50.9: 26.9, this is because China has a prominent manufacture which is almost double the competence that of India; but the proportion of service industry of them is 33.2: 48.2, and this is because the software industry and its accessorial service industry of India have obvious predominance over that of China.The second part firstly expatiated the respective situation of foreign trade of China and India. China has become a active participator in the economic globalization and got world-famous achievement in foreign trade in the 28 years from the beginning of the reform and open policy: The foreign trade scale is enlarging,its structure is being optimized and foreign direct investment is increasing rapidly. And India's foreign trade and investment have also driven into the highway after entering the 21th century with multiplex markets and partners. At the mean time, the exchange in economy and trade between China and India is becoming more often than before, and so far, India is the biggest trade partner of China in South Asia, and China is the second biggest partner of India. Then we are confident to say that the relationship between the dragon and the big elephant are taking off.According to the situation expatiated above, we learned that the trade between China and India has such characteristics: 1. The trade scale is increasing rapidly, but it is still not very large, and has small balance; 2. The trade structure is meliorating; 3. The economic cooperation is improving steadily. But it also has the problems below: 1.Many quality problems occurred resulting in more trade dissensions; 2.Bilateral trade has only taken a small part in their respective foreign trade which has not assorted with the large population and big market of these two countries; 3. India always carries out anti-dumping investigations upon China`s products; 4. India has extremely high tariff and very strict non-tariff barriers. Then we proposed many solutions to solve these problems.Basing on the two parts above, the third part has made an analysis on basement of the cooperation between China and India. We educed that China and India have each advantage in many fields such as resource,technology,agriculture and so on by exemplifying the three most typical industries: infrastructure,medicine and pharmacy,electronic information, and there are more mutual-complements and little competition in these fields, so they have great cooperation potential. The parties should take advantage of this kind of mutual-complement and otherness to cooperate actively and expand cooperation field to explore new growth spot in economy and realize common winning. For instance, in the IT industry, India has famous software industry but backward hardware industry; in opposite, China is worthy of the name in hardware industry with comparative weak software industry. It is necessary to integrate the software and hardware industry of these two countries and change each advantage into their mutual advantage to enhance the whole IT industry and optimize the resource distribution.We have also made an outlook of the bilateral economic and trade cooperation of China and India, and indicated many favored factors: 1. The huge market and mutual-complementary trade structure have offered a expansive space for the cooperation; 2. The rapid development of the two countries has supplied the momentum for the cooperation; 3. The melioration of the bilateral politic relationship has settled the basement for cooperation. We also proposed several propositions to expand the cooperation derive from all above analysis, for example: improve dialogue to enhance mutual- belief; develop the border trade vigorously to continue the trade relations; establish free trade zone and be unite to promote the cooperation among developing countries.