The advantages of the construction sector of China and India: a comparison

With the spectacular rise of the Chinese and Indian economies the accompanying growth in these two countries' construction sectors justifies more understanding. There is, however, a lot of unknowns about the two countries' construction sectors from a comparative perspective. This study attempted to identify and compare the comparative/competitive advantages of the two fast-growing economies in construction in pursuit of policy and management implications, which can benefit not only the two countries but also other developing countries. In this regard, a comparative advantage framework and Porter's Diamond Framework were applied to analyze the relative advantages of the Chinese and Indian construction sectors. The comparative analyses showed that China appears better endowed in labor with high productivity. Government intervention was identified as benefiting Chinese firms with support for the development of human resources. China also benefits from superior access to a wide range of inputs, including equipment, construction materials, and technology. The existence of large corporate champions provides scale of economy and contributes to the advantage of the construction sector of China. In contrast, India benefits from the increased competitive rivalry thanks to its more hands-off government policies that focus primarily on providing a good business environment with a favorable tax system, market entry policies, laws and regulations, and code/standard systems. The differences identified provide policy implications to the decision makers of the two countries in further developing their construction sectors. © 2014 American Society of Civil Engineers.