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Why india?

July 22, 2005

As a follow up to the article we did on why China is on everyone’s radar these days, we felt it was important to also examine another major Asian player that has equal potential: India. The United States National Intelligence Council has predicted that by the year 2020 China and India will be directly competing with the United States for global economic supremacy. The council likened China and India’s rise in the 21st century to the rise that America experienced in the 20th century. Here are some statistics that help show why India is going to be a strong player in this competition.

People/Economy
- Population of over 1.08 billion. China is over 1.3 billion and the United States is about 295.7 million.
- Population growth rate is 1.4%. China is .58% and the United States is .92%.
- Population is expected to overtake China by 2050 (1.628 billion to 1.437 billion).
- Over 58% of the population is under the age of 20.
- Largest English-speaking population in the world.
- An estimated 350 million English language speakers, about 30% of the population. China has an estimated 220 million English language speakers.
- The world’s 2nd fastest growing large economy after China.
- GDP of about $3.3 trillion. China is about $7.3 trillion. The United States is about $11.8 trillion.
- GDP per capita of $3,100. China is $5,600. United States is $40,100.
- Estimated GDP growth rate of 6.2% verses 9.1% for China and 4.4% for the United States.
- China is India’s second largest trade partner.
- US imports from India were $15.6 billion in 2004.
- India imports from the US were $6.1 billion in 2004.
- Outsourcing industry expected to grow by 40% in 2005 and bring in $20 billion in revenues in the next 3 years.

Resources
- Third largest producer of coal behind the United States and China.
- Coal is the dominant commercial fuel, used for more than 1/2 of total energy needs.
- Sixth largest consumer of energy.
- Oil accounts for 30% of total energy consumption.
- Oil imports account for 2/3 of India’s oil consumption compared to 1/3 of Chinas oil consumption.
- Oil reserves of 5 billion barrels, compared to 18 billion barrels in China.

Technology & Communication
- Worlds fastest growing telecommunications market.
- 55.9 million cellular phone users. China has 353.7 million users. The US has 180.5 million.
- 5% penetration rate for cell phones, compared to 26% in China and 50% in the United States.
- 1.7 million new users a month.
- Expected to be over 250 million cellular phone users by 2007.
- Just over one million cell phone users in 1998. China had 23.9 million users and the United States had 60.8 million.
- Over 39 million Internet users. China has almost 100 million. The United States has about 200 million.
- 3.6% Internet penetration rate, compared to 7.3% for China and 67.8% for the United States.
- Experienced a 684% growth in Internet users 2000 to 2005, compared to a 318% growth in China and a 110% growth in the United States.

Transportation
- Energy demand for transportation is expected to grow by 4.4% a year, and 5.3% in China.
- Transportation sector is expected to be 20% of Indias total energy consumption by 2025.
- Most extensive railway system in the world.
- Railway system employs about 1.6 million people, making it the world’s largest employer.
- 24% growth in car sales in 2004. China had a 15% increase and the US had a 1% increase.
- Sold over one million passenger vehicles in 2004. China sold about 5 million new cars. The United States sold 16.9 million.
- Goldman Sachs predicts that car sales volumes will overtake Germany by 2010, Japan by 2012, and will become the fourth largest market by 2020.

Advertising
- Current advertising market is approximately $2.2 billion.
- Internet advertising was $18 million in 2004, but is expected to grow to $34 million in the next year and $57 million in two years.
- 80% increase in advertising spending for cars and utility vehicles this year.
- Advertising industry is expected to grow 12-15% in 2005.

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