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A periodic sampling of news, analysis and opinion on economic issues of India, China and the USA
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Merry Christmas & warmest wishes for a Happy New Year 2010!
 -India China America Institute
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The ICA Institute is a non-profit research institute working to foster research and dissemination of knowledge on the rise of China and India and their impact on global markets, global resources and geopolitics of the world. The ICA Institute's mission is to generate new perspectives on the role of market and resource driven economic development. ICA Institute fosters interaction and dialogue between academic scholars, industry leaders and policy makers on the impact of emerging economies in general and China and India in particular. Specifically, The ICA Institute is positioned to be a catalyst between faculty and students in International Business and industry leaders and managers.

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From Our Publications
***************************************** big logoChinese Scientific Socialism in Global Perspective...
(JEKEM | Vol 1 Issue 1)
Western media tends to analyze the phrase "Socialism with Chinese characteristics" and its development manifestations along a continuum of capitalism, authoritarian or state to liberal, rather than analyzing the phenomenon and its parts from a socialist-communist model. A myopic analytical perspective fails to capture potentially new forms emanating from the scientific socialist prism and their local-to-global impact.

Latest from Chindia Biz
China's Housing Bubble
(ICA Institute | Dec 25)
An increasing number of analysts and policy makers are expressing concerns over high residential real estate prices in China. This article from Dexin Zhou, a researcher associated with ICA Institute summarizes two possible structural causes for the housing prices and the possible solutions to these structural problems. Recent policy responses to the over heated housing market have also been discussed.

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Insights
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India in the 21st Century
(BRICS | WWF)
India is currently the world's fourth largest economy in terms of real GDP (PPP) and the tenth largest economy in terms of nominal GDP.1 Over the last decade, the country has emerged as a leading actor on the international stage.2 India's role in both the WTO and the UN has often been that of bridging the divides between North and South, East and West, building on a long historic tradition.3 The outsourcing of services to India has over the past decade redefined the international business environment, and major Indian companies are now moving abroad on a scale never before witnessed.

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Headlines
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India Food Prices Climb 19.95%, the Most in 11 Year
(Bloomberg | Dec 18)
India's wholesale food prices rose at the fastest pace in eleven years, making it more likely that the central bank will raise borrowing costs to curb inflation.

China pension fund to raise overseas investment cap
(Global Times | Dec 17)
China's National Council for Social Security Fund plans to lift the limit of the ratio of overseas investments to 20 percent from the current 7 percent, according to the China Securities Journal report Thursday, citing Dai Xianglong, the fund's chairman.

Hollywood steps up its China game
(Hollywood Reporter | Dec 10)
After last year's Olympics drew global attention to China's shining modernity, 2009 proved a year of firsts for Hollywood studios trying to break into -- and ring serious returns from the planet's fastest-growing movie market.

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Policy | Politics
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India and Japan's 'China paradox'
(Foreign Policy | Dec 16)
India and Japan both face a similar "China paradox": China is, for each country, their single largest trading partner, yet is also seen by both as a potential long-term security threat (and many observers would drop the "potential" and "long-term" qualifiers). So India and Japan's own economic futures are inseparably linked with China's economic performance, even while their security concerns may also increase in tandem with China's growing military assertiveness.

Dubai offers lessons to China
(China Daily | Dec 18)
Like Dubai, China also possesses an enormous current account surplus and has pushed for large-scale investment. The country has also pinned high hopes on the development of the real estate market as a pillar industry to drive high-paced economic growth. Its property prices have also kept rocketing in recent years. Similar to the Arab emirate, China also has a large number of state-run conglomerates which play a crucial role in some of its pivotal economic domains. These enterprises perform well but lack a transparent system despite the fact that both China and Dubai have been witness to a construction boom in the past years.

Strategic interests drive US-China-India ties
(Economic Times | Dec 20)
Given the geopolitical situation in the region and America's continuous predominance in regional security, an inevitable question, and indeed a shared concern, for Beijing and New Delhi is that how the two bilateral relationships will affect each other. In other words, will the development in the US-China relations help to promote, or undermine, the US-India relations as well as India's national interests, and vice versa?

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Environment | Climate Change
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China welcomes U.S. climate cash offer
(Reuters | Dec 17)
COPENHAGEN (Reuters) - China said on Thursday a U.S. pledge to mobilize $100 billion a year in climate funds was a "good step," and signaled Beijing was seeking compromise with Washington on its demand for checks on Chinese emissions curbs.

China and Copenhagen
(Reuters | Dec 16)
China is announcing that it would cut carbon dioxide emissions per unit of GDP by about 40 to 45% by 2020. Such a drastic cut is despite its apparent reluctance to slash emissions. One answer why she is willing to think thus, is the fact that China has an eye on the green energy business which is likely to grow soon to a global market of $1 trillion.

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InfoComm | Technology
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RIM faces more smartphone competition in North America, challenges in China
(The Canadian Times | Dec 20)
The BlackBerry faces more competition in the consumer market, especially in North America, and it's entry into China will have challenges, analysts say. Fresh from a gain of more than 10 per cent on Friday and after beating profit expectations, Research In Motion (TSX:RIM) faced questions about if it can maintain such growth.

The BPO Market Is Not Sustainable in the Long Run
(Knowledge@Wharton | Dec 17)
"Business process outsourcing, or BPO ... is based on cost arbitrage, with players who are in low-cost locations around the world that shift the burden of work [from one location to another to take advantage of lower costs]...There are several factors that make cost arbitrage evaporate over time."

Infosys to make China biggest development centre outside India
(The Hindu | Dec 12)
n a far-reaching move, IT bellwether Infosys Technologies has decided to make China its biggest development centre outside India. "China will be our biggest development centre outside India while the US will be the largest market in terms of revenues and India will remain the largest in terms of physical presence," the Infosys Technologies Chief Executive Officer and Managing Director, Mr Kris Gopalakrishnan, told Business Line.

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Logistics | Transportation
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Volkswagen starts production of first India car
(Associated Press | Dec 12)
Volkswagen AG started production of its first compact car in India on Saturday, hoping to capture up to 10 percent of the country's fast-growing automobile market within the next six years, the company said.

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Energy
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India Makes Push for Solar Power
(Wall Street Journal | Dec 16)
India's pushing for 20,000 megawatts of electricity to come from solar power by 2022. WSJ's Amol Sharma went to the country's largest commercial solar project, the Azure Power plant in the state of Punjab, to get the latest on these "green" efforts.

Rising Sun: India's Solar Power Initiatives Are Shining Brighter
(Knowledge@Wharton | Dec 17)
Against the backdrop of the Copenhagen climate summit, solar power in India has moved to center stage. The government has unveiled a national solar mission that aims to establish the country as a global leader in solar energy. An ambitious target has been set of generating 20 gigawatts by 2022.

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Infrastructure | Real Estate
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Real estate bookings outnumber deliveries in India; 10 to one
(Economic Times | Dec 20)
Apparently, it's time only for new launches and no possessions (read delivery of goods promised in the contract).

China Property Stocks Drop Most Since August on Curbs
(Bloomberg | Dec 20)
China asked vice mayors of more than 600 cities to attend the central government's annual housing meeting, a rare move that shows the importance of the gathering as part of efforts to curb property price growth, the 21st Century Business Herald reported, citing an unidentified vice mayor invited to the event.

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Opinions
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As ties between India and China grow, so does mistrust
(Washington Post | Dec 14)
Recent border incidents test partnership in trade, climate change.

Focus on India and China could be of Great Benefit to the Middle East
(Al Bawaba | Dec 20)
Based on the latest MasterCard Worldwide Insights report - Global Recession and the Middle East - Perspective from the Europe Linkage, the Eurozone's recovery from the global recession is being made difficult and prolonged due to an internal structural imbalance. Such an imbalance is proving to be a drag on global economic recovery; negatively affecting key regions of the world economy, including the Middle East.

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ICA Institute

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International Contributors Editorial Board
Prashant Das - Co-Editor | Anitha Vadavatha - Co-Editor | Ruchir Agrawal - Atlanta | Christopher Chan - Intellectual Property - Hong Kong | Dr. Sudhanva Char - Academic Resources | |  Harsha Harjani - Hong Kong | Asha Hemrajani - Singapore | Geoff Hiscock - Australia | Shree Pandya - Engaging Youth | Xun Sun - USA | Dr. Nilay Yajnik - India |  Dr. Xiao Yu - USA