Question

discuss the public administrative reforms of China and India in relationship to budgeting and accounting

Answer 1

The two Asian giant economies china and India had undergone several changes in the public administrative reforms with respect to budgeting and accounting over the years .In China these reforms got implemented mostly after 1970s where as in India these reforms obtained importance after the LPG(liberalisation, privitisation, globalisation)reforms .

Five year plans in both these countries played a vital role in formulating the budget and accounting.both the nations followed USSR's model .The priorities may be different that is china invested more in military and industries where as India allocated resources to develop agriculture to become self sufficient.budgeting in China since 1953 started to invest more in industrial policy and socialisation since it is a communist country from the beginning.china tried to maximise the national income by attracting foreign firms by converting itself as market economy with socialistic norms and regulations .India being a democratic country didn't want to have external trade and exchange until 1991-92 where the LPG reforms got implemented which allowed the foreign markets to establish their industries here.india wanted neither market economy nor socialist economy but a mix of both i.e mixed economy to give equal treatment to everyone.accounting has a long-standing history in China but on transparency wise it is neglected to the core until the formation of five year plans whereas in India during the British rule accounting gained significant role since they must be accountable to the crown .But the first official Indian administrative reforms commission got appointed in 1966 only.this commission advised the government to formulate policies regarding the railways ,reserve bank , relationship between the states and center ,small industries development etc. For accounting​ purpose India has public accounts committee represented by members of parliament to discuss and debate the accounting structure and changes and a constitutional post known as comptroller and auditor general to oversee all the public purse and expenditure .Chinese Accounting standards maintain the balance sheets and expenditure receipts on annual income of the country .And these standard were replaced mostly by international financial reporting standards to maintain transperancy and clear accounting.

Common reforms :- both the budgets in china and India promote agriculture as the primary sector .India had brought several reforms like green green revolution,white revolution,blue revolution to promote wheat,milk and fish production .Around the same time in 1978 china also implemented chinese rural reforms under Deng Xiaoping government.

India promotes foreign direct investments by providing special incentives like tax cuts , providing free infrastructure etc.A new model known as special economic zone was created to this effect .In China where so much manpower is there gave importance to industrial sector which propelled the national income as almost 50 % of GDP is contributed by industry sector now.