Steven SchwankertBy Steven Schwankert
On the way home from another gala dinner this week, the topic of China versus India in the worldwide software smackdown came up. Although one of the participants, misguided as she was, made a brief statement on behalf of India, it was clear that her ignorance outweighed her information. The mighty foot of China, it seems, continues to stomp all around it.

The Grouch understands why people make these comparisons: they make great headlines, readers in both nations and their supporters will get all hot and bothered, and like any other set of statistics, they can be skewed to show that China, India, or Lithuania is the greatest country on the planet, depending how the author massages the numbers.

This argument is particularly popular as both suck up greater amounts of US software and other technical outsourcing work. It's also fun for people who know very little else about either country to look at the map and say, "Wow, China and India. They're both big countries. They're both have huge populations. They're both in Asia." This is like Homer Simpson's school of geo-politics.

In reality, the two nations share very little. Both are home to way too many people. Both are Asian. And�� yeah, that's about it. Their peoples don't look alike; they don't eat the same food; they certainly don't speak the same language(s); and except for a significant Muslim population in both nations, they don't share a common religion.

To bring the contrast into more stark relief, start putting other numbers side by side. China's infrastructure smokes that of India, in roads, in telecommunications, you name it. China measures its mobile phone subscribers in the hundreds of millions, compared to India's 20 million or so. Pro-India pundits point to the huge growth in that country's mobile sector. Yes: when you have one subscriber, and you add another one, you've doubled your subscriber base. When zero is the baseline, there's nowhere to go but up. While China was spending billions building out its fixed line and mobile infrastructure in the 1990s, India, well, wasn't.

The same is true with Internet users. China now has the world's second largest Internet market, and some people actually managed to make some nice cash from investing in the nation's Internet plays (including Grouch truly). In some places in China, namely large cities like Beijing and Shanghai, it's easier to have broadband installed than in many parts of the United States. Don't believe the Grouch? Try it and see. India? Broadband? Try getting online via dial-up for starters. Again, relative to population, India's Internet population, for a country that makes such a big deal out of its software industry, has extremely poor connectivity.

China has demonstrated again and again that when it focuses its resources, especially financial resources, there aren't many that can stand in its way. It spent a decade creating a world-class telecoms infrastructure, and it has one. If it wants a world-class software industry, guess what? It'll have one. There are plenty of eager returnees who are looking to make a bundle, and they'll be ready to do it. That's exactly how India did it, and outsourcing to India has become more expensive than sending the same work to China.

Let's throw in some other metrics just for fun. China won 63 medals at the 2004 Olympics, 32 of them gold. India won a single silver medal. China will host the 2008 Olympics. No Indian city has yet made a serious bid for the Games. China is on its way to becoming one of the world's most popular tourist destinations. India just isn't.

More importantly, India's regulations regarding foreign investment are downright draconian. Foreign firms are excluded from the country's retail sector, for example. Despite horror stories from China about nightmare joint venture partners, many multinational corporations have come to China and are now cashing in, after years, if not decades, of hard work and losses. In India, many of the same companies are just plain locked out. This is 2004. What the hell are they waiting for?

Stop comparing China and India. There is no comparison.

About the author:
Steven Schwankert is a former editor of Computerworld Hong Kong, based in Beijing. He can be reached at [email protected]


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