Comparative Study On The Competitiveness Of Trade In Services Between China And India

Along with the restructuring of the world economy and the deepening of economicglobalization, the service industry has been developed by leaps and bounds which contributesto the rapid development of trade in services. The competitiveness of trade in services hasincreasingly become the important criteria to evaluate the competitiveness of a country as awhole. Therefore, improving the competitiveness of service trade to promote the overalleconomic development is the objective requirement of economic restructuring. Thedevelopment of China’s trade in services has seen the momentum of accelerated increasewhile the amount of import and export in services has been expanded constantly. However,we should also be aware of the relatively weak competitiveness of trade in services in China.India, also as another developing country, having many backgrounds comparable with China,has made remarkable achievements in its development of trade in services. Thus, somesuggestions are proposed to promote China’s competitiveness of trade in services on the basisof learning from India’s experience of trade in services, so as to provide better services for thedevelopment of economy.The paper summarizes the documents and theories in the area of internationalcompetitiveness of trade in services and also analyzes the development status of service tradein China and India. In the paper, comparable analysis has been made on the competitivenessboth overall and respectively segments by using certain indices including InternationalMarket Share, Export Contribution Rate, Trade Competitive Index, Revealed ComparativeAdvantage Index and Export Rise Advantage Index. The study indicates that the amount ofChina’s service trade exceeds India. However, India has leading superiority in structureoptimization and upgrading of service trade and has certain competitive advantage in somenew industries. Then the paper chooses six factors that affect the competitiveness of trade inservices including production resources, service demand, service industry development,foreign direct investment, the function of government and etc to carry out a comparativeanalysis between China and India. On the basis of the above analysis, some suggestions are proposed to promote competitiveness of service trade of China which includes that promotingthe development of service industry, strengthening the development of human resource,guiding the flow of foreign direct investment, making full use of the government’s function,fostering intermediary services market and improving the legislation.