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China vs. India


Submitted By rvzl2008
Words 4090
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Being a Health Care Management Major, the product I chose to introduce internationally is related to the medial field. Anyone who lives in the world today knows that technology is becoming a way of life. It seems that no one goes anywhere without their smart phone in their pocket and a GPS in their car. A field that has been completely changed by advances in technology is the medical field. No longer due doctors take ones temperature or blood pressure manually, they have special devices that can give a more accurate reading then a human ever could. Hand held medical scanner technology is showing an astonishing breakthrough and can revolutionize home and hospital medicine just as the home thermometer did. These types of devices have already improved the way care is given in the U.S. greatly and can do the same for countries all over the world. The two countries I chose to enter are ones that have been growing rapidly in almost all aspects, China and India.
Handheld medical scanners are a real product being used but are very new and do not have much of a history or a company that solely produces them. So what are they? According to David Freeman in the Huffington Posts article “Star Trek's Tricorder Medical Scanner May Become Reality, Thanks To Nanotechnology Breakthrough,” using nanotechnology, physicists in London and Singapore found a way to make a beam of the "T-rays"--which are now used in full-body airport security scanners--stronger and more directional. The advance, which was described in a recent issue of the journal Nature Photonics, could lead to T-ray scanning devices that are smaller and more portable than existing devices. "T-rays promise to revolutionize medical scanning to make it faster and more convenient, potentially relieving patients from the inconvenience of complicated diagnostic procedures and the stress of waiting for accurate results, one of the scientists behind the breakthrough, Stefan Maier, a professor of physics at Imperial College London, said in a written statement. The T-ray scanners envisioned by the researchers would sense, compute, and transmit diagnostic data. For example, the scanners would be able to check DNA and detect tumors noninvasively and on the spot (Freeman, 2012).
In the article “Star Treks tricorder medical scanners could become reality after breakthrough in T-ray technology,” it says the waves are also capable of detecting biological phenomena such as increased blood flow around tumorous growths, but current techniques are pricey and low power. The researchers say their method of producing stronger and more continuous wave T-rays could be used to make better medical scanning gadgets, leading to innovations similar to the 'tricorder' scanner used in Star Trek. The development could lead to medical tests becoming quicker and more convenient for patients (dailymail, 2012). The device works by reflecting a beam of light off your skin and analyzing the wavelengths reflected back into the device. The information that processed is able to work out the anti-oxidant levels in your skin. So just point the device at your skin, wait three minutes and the device will tell you how healthy you are from a scale of one to ten (worst to best). Before the invention of this device, the only way for doctors to get the same type of readings was to get tissue samples and process them (Rebekah, 2011).
A more sophisticated technique that could be performed in hospitals is also described in the Science Daily’s article “T-Rays Technology Could Help Develop Star Trek-Style Hand-Held Medical Scanners,” researchers demonstrated that it is possible to produce a strong beam of T-rays by shining light of differing wavelengths on a pair of electrodes, two pointed strips of metal separated by a 100 nanometre gap on top of a semiconductor wafer. The structure of the tip-to-tip nano-sized gap electrode greatly enhances the THz field and acts like a nano-antenna to amplify the wave generated. In this method, THz waves are produced by an interaction between the electromagnetic waves of the light pulses and a powerful current passing between the semiconductor electrodes. The scientists are able to tune the wavelength of the T-rays to create a beam that is useable in the scanning technology (ScienceDaily, 2012).
Why choose China as a country to look to invest in? For centuries China stood as a leading civilization, outpacing the rest of the world in the arts and sciences, but in the 19th and early 20th centuries, the country was beset by civil unrest, major famines, military defeats, and foreign occupation. After World War II, the Communists under MAO Zedong established an autocratic socialist system that, while ensuring China's sovereignty, imposed strict controls over everyday life and cost the lives of tens of millions of people. After 1978, MAO's successor DENG Xiaoping and other leaders focused on market-oriented economic development and by 2000 output had quadrupled. For much of the population, living standards have improved dramatically and the room for personal choice has expanded, yet political controls remain tight. China since the early 1990s has increased its global outreach and participation in international organizations (CIA, 2012). China has continued over the past several years. China’s strong productivity growth is the leading cause of China’s unprecedented economic performance. China welcomes foreign direct investment with an open door policy. Cumulative foreign direct investment reached nearly $1100 billion in 1994; annual flows increased from less than one percent of total fixed investment in 1979 to eighteen percent in 1994. This foreign money has built factories, created jobs, linked China to international markets, and led to important transfers of technology (Hill, 2011).
China is located in Eastern Asia, bordering the East China Sea, Korea Bay, Yellow Sea, and South China Sea, between North Korea and Vietnam. With a population of 1,343,239,923 as of July 2011. China borders Afghanistan 76 km, Bhutan 470 km, Burma 2,185 km, India 3,380 km, Kazakhstan 1,533 km, North Korea 1,416 km, Kyrgyzstan 858 km, Laos 423 km, Mongolia 4,677 km, Nepal 1,236 km, Pakistan 523 km, Russia (northeast) 3,605 km, Russia (northwest) 40 km, Tajikistan 414 km, Vietnam 1,281 km. The climate is extremely diverse; tropical in south to subarctic in the north with mostly mountains, high plateaus, deserts in the west; plains, deltas, and hills in the east. The climate is not all that different from the U.S. so any expatriates should not have as much of a difficulty adjusting. China’s natural resources include coal, iron ore, petroleum, natural gas, mercury, tin, tungsten, antimony, manganese, molybdenum, vanadium, magnetite, aluminum, lead, zinc, rare earth elements, uranium, hydropower potential (world's largest). The issue with investing in China is the rate of natural hazards, frequent typhoons (about five per year along southern and eastern coasts); damaging floods; tsunamis; earthquakes; droughts; land subsidence. Along with air pollution (greenhouse gases, sulfur dioxide particulates) from reliance on coal produces acid rain; water shortages, particularly in the north; water pollution from untreated wastes; deforestation; estimated loss of one-fifth of agricultural land since 1949 to soil erosion and economic development; desertification; trade in endangered species. We most note though that China is the world's fourth largest country after Russia, Canada, and U.S. (CIA, 2012).
The political system of China varies greatly from the U.S. China is of course a communist state with 23 provinces (sheng, singular and plural), 5 autonomous regions (zizhiqu, singular and plural), and 4 municipalities (shi, singular and plural). China uses a civil law system influenced by Soviet and continental European civil law systems; legislature retains power to interpret statutes. China’s executive branch consists of President HU Jintao (since 15 March 2003); Vice President XI Jinping (since 15 March 2008); Premier WEN Jiabao (since 16 March 2003); Executive Vice Premier LI Keqiang (17 March 2008), Vice Premier HUI Liangyu (since 17 March 2003), Vice Premier ZHANG Dejiang (since 17 March 2008), and Vice Premier WANG Qishan (since 17 March 2008). The legislative branch is the unicameral National People's Congress or Quanguo Renmin Daibiao Dahui (2,987 seats; members elected by municipal, regional, and provincial people's congresses, and People's Liberation Army to serve five-year terms). The judicial branch is the Supreme People's Court (judges appointed by the National People's Congress); Local People's Courts (comprise higher, intermediate, and basic courts); Special People's Courts, primarily military, maritime, railway transportation, and forestry courts (CIA, 2012). Choosing to invest in China, our company would not run into any technological issues. They are just as up to date as the U.S. with domestic and international services being increasingly available for private use; unevenly distributed domestic system serves principal cities, industrial centers, and many towns; China continues to develop its telecommunications infrastructure, and is partnering with foreign providers to expand its global reach; China in the summer of 2008 began a major restructuring of its telecommunications industry, resulting in the consolidation of its six telecom service operators to three, China Telecom, China Mobile and China Unicom, each providing both fixed-line and mobile services. They have a full broadcast media and currently 389 million internet users.
China’s rapidly growing economy is one of the primary reasons that we are looking to invest there. Since the late 1970s China has moved from a closed, centrally planned system to a more market-oriented one that plays a major global role - in 2010 China became the world's largest exporter. Reforms began with the phasing out of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, creation of a diversified banking system, development of stock markets, rapid growth of the private sector, and opening to foreign trade and investment. China has implemented reforms in a gradualist fashion. In recent years, China has renewed its support for state-owned enterprises in sectors it considers important to "economic security," explicitly looking to foster globally competitive national champions. After keeping its currency tightly linked to the US dollar for years, in July 2005 China revalued its currency by 2.1% against the US dollar and moved to an exchange rate system that references a basket of currencies. From mid 2005 to late 2008 cumulative appreciation of the renminbi against the US dollar was more than 20%, but the exchange rate remained virtually pegged to the dollar from the onset of the global financial crisis until June 2010, when Beijing allowed resumption of a gradual appreciation. The restructuring of the economy and resulting efficiency gains have contributed to a more than tenfold increase in GDP since 1978. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2010 stood as the second-largest economy in the world after the US, having surpassed Japan in 2001. The dollar values of China's agricultural and industrial output each exceed those of the US; China is second to the US in the value of services it produces. Still, per capita income is below the world average. The current GDP for purchasing power parity is 11.44 trillion with the official exchange rate GDP is 7.298 trillion, which gives the GDP a growth rate of 9.2% (CIA, 2012).
Since the product we are looking to introduce to China is related to the medical field, an overview of the current state of the Chinese healthcare system would be very helpful. Since the founding of the People's Republic, the goal of health programs has been to provide care to every member of the population and to make maximum use of limited health-care personnel, equipment, and financial resources. The emphasis has been on preventive rather than curative medicine on the premise that preventive medicine is "active" while curative medicine is "passive." The health-care system has dramatically improved the health of the people, as reflected by the remarkable increase in average life expectancy from about thirty-two years in 1950 to sixty-nine years in 1985. Although the practice of traditional Chinese medicine was strongly promoted by the Chinese leadership and remained a major component of health care, Western medicine was gaining increasing acceptance in the 1970s and 1980s. For example, the number of physicians and pharmacists trained in Western medicine reportedly increased by 225,000 from 1976 to 1981, and the number of physicians' assistants trained in Western medicine increased by about 50,000. In 1981 there were reportedly 516,000 senior physicians trained in Western medicine and 290,000 senior physicians trained in traditional Chinese medicine. The goal of China's medical professionals is to synthesize the best elements of traditional and Western approaches. Although health care in China developed in very positive ways by the mid-1980s, it exacerbated the problem of overpopulation. In 1987 China was faced with a population four times that of the United States and over three times that of the Soviet Union, this has only increased since then. Efforts to distribute the population over a larger portion of the country had failed: only the minority nationalities seemed able to thrive in the mountainous or desert-covered frontiers. Birth control programs implemented in the 1970s succeeded in reducing the birth rate, but estimates in the mid-1980s projected that China's population will surpass the 1.2 billion mark by the turn of the century, putting still greater pressure on the land and resources of the nation (Dolan, Savada & Worden, 2011). Of course the estimates were correct, overpopulation is a serious issue in China. The hand held scanners will fit perfectly into the Chinese style of preventative care; they can easily detect issues that would become serious if not caught early on.
Why choose to invest in India? The Indus Valley civilization, one of the world's oldest, flourished during the 3rd and 2nd millennia B.C. and extended into northwestern India. Aryan tribes from the northwest infiltrated onto the Indian subcontinent about 1500 B.C.; their merger with the earlier Dravidian inhabitants created the classical Indian culture. The Maurya Empire of the 4th and 3rd centuries B.C. - which reached its zenith under ASHOKA - united much of South Asia. The Golden Age ushered in by the Gupta dynasty (4th to 6th centuries A.D.) saw a flowering of Indian science, art, and culture. Islam spread across the subcontinent over a period of 700 years. In the 10th and 11th centuries, Turks and Afghans invaded India and established the Delhi Sultanate. In the early 16th century, the Emperor BABUR established the Mughal Dynasty which ruled India for more than three centuries. European explorers began establishing footholds in India during the 16th century. In November 2008, terrorists originating from Pakistan conducted a series of coordinated attacks in Mumbai, India's financial capital. In January 2011, India assumed a nonpermanent seat in the UN Security Council for the 2011-12 terms. Despite pressing problems such as significant overpopulation, environmental degradation, extensive poverty, and widespread corruption, rapid economic development is fueling India's rise on the world stage (The world fact book, 2012).
India is located in Southern Asia, bordering the Arabian Sea and the Bay of Bengal, between Burma and Pakistan. It borders Bangladesh 4,053 km, Bhutan 605 km, Burma 1,463 km, China 3,380 km, Nepal 1,690 km, Pakistan 2,912 km. India’s climate varies from tropical monsoon in the south to temperate in the north with an upland plain terrain in the south, flat to rolling plains along the Gangers, deserts in the west, and the Himalayas in the north. The extreme climate could make adjustment difficult to expatriates to India. India’s natural resources are coal (fourth-largest reserves in the world), iron ore, manganese, mica, bauxite, rare earth elements, titanium ore, chromite, natural gas, diamonds, petroleum, limestone, and arable land. We will have to take into consideration India’s droughts; flash floods, as well as widespread and destructive flooding from monsoonal rains; severe thunderstorms; earthquakes, along with deforestation; soil erosion; overgrazing; desertification; air pollution from industrial effluents and vehicle emissions; water pollution from raw sewage and runoff of agricultural pesticides; tap water is not potable throughout the country; and the huge and growing population is overstraining natural resources. Overall though, India dominates the South Asian subcontinent and is near important Indian Ocean trading routes (The world fact book, 2012).
India has a federal republic government, with 28 states and 7 union territories. A common law system based on the English model; separate personal law codes apply to Muslims, Christians, and Hindus; judicial review of legislative acts. The executive branch is made up of President Pranab MUKHERJEE (since 22 July 2012); Vice President Mohammad Hamid ANSARI (since 11 August 2007); Prime Minister Manmohan SINGH (since 22 May 2004). The legislative branch is a bicameral Parliament or Sansad, consists of the Council of States or Rajya Sabha (a body consisting of 245 seats up to 12 of which are appointed by the president, the remainder are chosen by the elected members of the state and territorial assemblies; members serve six-year terms) and the People's Assembly or Lok Sabha (545 seats; 543 members elected by popular vote, 2 appointed by the president; members serve five-year terms). The judicial branch is a Supreme Court (one chief justice and 25 associate justices are appointed by the president and remain in office until they reach the age of 65 or are removed for "proved misbehavior"). Unlike China, technology in India is not as prevalent, there phone system is supported by recent deregulation and liberalization of telecommunications laws and policies, India has emerged as one of the fastest growing telecom markets in the world; total telephone subscribership base approached 800 million in 2010, an overall teledensity exceeding 65%, and subscribership is currently growing more than 20 million per month; urban teledensity now exceeds 100% and rural teledensity is about 30% and steadily growing. They also have a full broadcast media and currently 61.338 million internet users (The world fact book, 2012).
Just like with China, India’s growing economy is a primary reason for investment. India is developing into an open-market economy, yet traces of its past autarkic policies remain. Economic liberalization, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth, which has averaged more than 7% per year since 1997. India's diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Slightly more than half of the work force is in agriculture, but services are the major source of economic growth, accounting for more than half of India's output, with only one-third of its labor force. India has capitalized on its large educated English-speaking population to become a major exporter of information technology services and software workers. In 2010, the Indian economy rebounded robustly from the global financial crisis - in large part because of strong domestic demand - and growth exceeded 8% year-on-year in real terms. Little economic reform took place in 2011 largely due to corruption scandals that have slowed legislative work. India's medium-term growth outlook is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates, and increasing integration into the global economy. India’s GDP for purchasing power parity is 4.515 trillion with an official exchange rate GDP of 1.676 trillion, giving them a 7.2% GDP growth rate (The world fact book, 2012).
We also need to look at the current healthcare in India. The Indian constitution charges the states with "the raising of the level of nutrition and the standard of living of its people and the improvement of public health." However, many critics of India's National Health Policy, endorsed by Parliament in 1983, point out that the policy lacks specific measures to achieve broad stated goals. Particular problems include the failure to integrate health services with wider economic and social development, the lack of nutritional support and sanitation, and the poor participatory involvement at the local level. Central government efforts at influencing public health have focused on the five-year plans, on coordinated planning with the states, and on sponsoring major health programs. Government expenditures are jointly shared by the central and state governments. Goals and strategies are set through central-state government consultations of the Central Council of Health and Family Welfare. Central government efforts are administered by the Ministry of Health and Family Welfare, which provides both administrative and technical services and manages medical education. States provide public services and health education (Heitzman & Worden, 1995). We would assume that the scanners would do very well in India, once again due to adding more preventative care and that the low cost of production. The scanners will allow care facilities to save money and expensive tests, and allow doctors to more accurately assess the health of one of their patients. Also, machines that are currently used are very expensive while the price for a scanning unit is about seven thousand US dollars.
So the question remains, China or India? The article “China or India: Which Is the Better Long-term Investment for Private Equity Firm?” explains that India and China are both vast countries just opening to development, filled with opportunity and risk for private equity investors. Inevitably, the two countries' rising economic fortunes invite debate over which offers the better climate for investment. At first glance, India might not seem the safer bet, with its pitted roadways, tainted water and visible, widespread poverty. Yet those outward signs obscure solid underpinnings for economic growth, including a democratic government, a strong education system, widespread knowledge of English and a deep pool of expatriates experienced in Western businesses, according to the author and experts in emerging market private equity. Cheap labor and foreign direct investment have made China the world's manufacturing powerhouse under a government that has embraced Western-style capitalism. China has provided spectacular private-equity returns in recent years, but, the experts note, weaknesses in China's legal system and the possibility of political instability remain concerns for investors. “Clearly there’s an enormous private equity opportunity in both countries,” the author says. As for the better investment climate long-term, the author sides with India. He says the country's "soft" attributes, such as a democratic government and a free press that is rooting out corruption, outweigh China's more impressive investments in "hard" infrastructure such ports, plants, and transportation systems. He notes that he is also concerned about China's system of "guanxi" in which business is conducted more through elaborate networks of relationships than on merit (Siegel, 2006).
A good way to make a decision is to look at how the rest of the country invests. The CNBC article “China Vs. India-Where to Invest Now: Strategists” talks about President Obama’s talk to the Indian parliament, stressing the importance of the relationship between the U.S. and India. Obama is also expected to speak with Chinese president Hu Jintao at the APEC CEO Summit. The author talks to Mike Holland, chairman of Holland & Company and Jim Iuorio, director of TJM Institutional Services. “China is going to surprise to the upside,” Holland told CNBC. “India’s very attractive too, but I’m closer to the investments in China and any surprise we get from the companies over there in the next year or two are going to be on the upside.” In the meantime, Iuorio said India is a democratic, demand-driven economy and also has a legal structure that the Western world is more accustomed to. “For the short-term, it seems that China has these meteoric GDP rises whereas India’s a better play for the longer-term,” he said. "Also, if you believe in a global recovery, India’s the way to go and there’s an ETF — EPI — that’s compromised of all Indian companies with 31 percent in industrial materials” (Park, 2010).
There is no question that both China and India are growing and becoming primary countries for investments. We can start in larger care facilities and once the market is well accustomed to the scanners they can be sold to average individuals for use in the home to aid in preventative care. After comparing both countries and looking at what other firms have done, the best place to introduce the scanners would be in India. India’s growth and there need for improved and less expansive preventative care techniques makes them a great place to introduce this product.

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