How to race along a circle


Can India outrun China to the superpower podium? Raghav Bahl’s simplistic account offers no answers, says Shastri Ramachandran

THIS IS an important book. Important for what it doesn’t say. Raghav Bahl raises plenty of pertinent questions — What if India were to graft some of China’s ambition and determination? Can India fix its governance more easily than China can repair its politics? Those posed by foreign investors — Why does your government take so long to give approvals? Why does such abject poverty coexist with such immense amounts of corporate wealth in India? How come you have built such an efficient capital market? What’s missing however, are the answers.

Bahl maps China’s turbo-charged rise as an economic powerhouse. He drives home the 9 percent growth every year for 30 years, the 11-time increase of its per capita income in that short period, the 400 million people pulled out of abysmal poverty and the largest cash horde of $2.5 trillion. Such data fills the book even if without the characteristic scepticism with which distant observers view official Chinese figures.

According to Bahl, India is not far behind. He calls it “an uncanny prototype of a ‘promising’ economy… giving it the kind of organic strength that transformed the US, UK, Germany and Japan”. Why? Because, according to Bahl, nearly 58 percent of India’s GDP is consumed by over a billion people; and its rural economy is made up of 800 million people spending over $425 billion. His most breathtaking statement about India is that “If 200 years of economic theory is sound, then India simply must succeed in creating an America- and Japan-like miracle.” Since he does not explain how, it’s difficult to either agree or disagree with him.

Delivered in a racy text, Bahl does a good job of profiling the two rivals and their race but fails entirely to go beyond the rates of growth into questions of sustainability that would give us some hint of how such a race might end. Bahl seems unaware of the price that China’s growth is extracting — awesome income disparities, rising unemployment, displaced and discontented rural population, environmental degradation and pervasive social malaise. These black holes are a greater threat to China’s social and political stability than the restive minorities in Tibet and Xinjiang.

THERE IS also no denying the irrepressible urge among China’s millions for greater political freedom. The danger of denying these to the majority is recognised at the highest level. Premier Wen Jiabao has been candid that China risks losing the gains of three decades of economic growth if it fails to enlarge democratic rights and initiate political reforms. And yet, such reforms in China will not be without economic turbulence and unpredictable social consequences that may abort its rise as a superpower.

The danger inherent in an overenthusiastic endorsement of China’s achievements and treating the economic growth of the two countries as a race is an implicit invitation to Indian policy makers to adopt Chinese methods of securing this growth and that is an invitation to catastrophe.

Ramachandran is Senior Editor with Global Times, Beijing

‘Indians use democracy as an excuse for nonperformance’

Raghav Bahl is the founder-promoter of Network18, one of India’s leading news networks. An idea for a TV series to explore myths about business in China became his new book instead. Bahl spoke to VILASINI ROY on the pros and cons of the different systems in India and China. Edited excerpts

Looking East Network18 founder-promoter Raghav Bahl believes China’s growth is economically inefficient
Looking East Network18 founder-promoter Raghav Bahl believes China’s growth is economically inefficient

What is China’s biggest strength?
Their leadership — extremely focused and with a strong work ethic.

Does India being a democracy justify its slow growth vs China’s?
Not really. Democracy is our biggest strength. People often use democracy as an excuse for non-performance in India. But what often gets confused is that what is a crisis of leadership is passed on as a crisis of democracy. Democracy is a strength, and a system where wealth creation is much easier because innovation and entrepreneurship flourish. Our leaders need to make bold decisions instead of moving incrementally, especially in the areas of social infrastructure: health, education, agriculture, government-regulated finances and legislative reforms so as to drive inclusive growth.

Doesn’t the lack of democracy make it easier for Chinese leaders to focus? They don’t worry about satisfying the public.
Yes, things get done very quickly but there are no checks and balances. Obviously, there are tensions that people barely see or read about. China’s spectacular growth is economically very inefficient. The resources they use to produce one unit of output is much higher than in India. Checks and balances ensure that excesses don’t happen. If a decision has to go through layers of questioning, opposition and scrutiny (as in India), it’s likely, more often than not, to be “less wasteful” than if you took that decision without worrying about scrutiny or consequences. There are several credible studies showing that China uses many more “unit resources” per unit of output. The Chinese themselves admit it (relative to India’s resource consumption).

Design all our dreams

Tom Plate passes up a great chance to probe Singapore’s patriarch, says Poorva Rajaram

MINISTER MENTOR is the farcical title Lee Kuan Yew holds after serving as Singapore’s prime minister from 1959- 1990. American journalist Tom Plate engages Yew on ideology versus pragmatism, socio-economic models and regional politics. Plate’s self-professed goal is to paint a rosy picture of Yew’s 50-year stranglehold on Singaporean governance, because “for many westerners, Singapore is little more than a technologically psyched- up, soft-core gulag of caning”. Plate’s approach is patronising in his rousing defence of Yew from western media criticism and insistence that Singapore “remains a perpetual puzzle”. Oriental overtones are compounded by Plate’s analysis, which rests on stereotypes of Asian ethnicities. Plate is honest about the ongoing transactions between his subject and him (“sometimes my questions are dumb by design”) and often hits an off-note with Yew, who disapproves of banal chatter. Yew’s primary defence against human rights activists is pragmatism: he did what worked, and Plate is convinced. Yew’s statements are placed in an elaborate web of Plate’s own anecdotes, qualms and opinions. Yew comes away sounding more lucid, and dare I say, more fascinating of the two.

The word

Shabnam Hashmi Human Rights Activist

Your favourite genre?
Fiction and poetry both. But I have to say I’m particularly biased towards reading poetry.

Your favourite poets?
I really admire the renowned Pakistani poet Faiz Ahmed Faiz. I’m also very fond of the Russian poet and author, Alexander Pushkin.

Which books left an impression on you as a young girl?
When I was younger, I read that classic story of the holocaust — The Diary of Anne Frank. It is impossible not to be affected by that book. Another novel I remember was called The Story of Zoya and Shura. It was written by Zoya’s mother, Lyubov Kosmodemyanskaya. It is the tale of the capture and torture of a young girl named Zoya in fascist Russia. It is a very moving story that describes the life of one of Russia’s most revered martyrs, and as a young woman, it had a great impact on me.

Your favourite character?
It would have to be Zoya, for her extraordinary courage. She is not fictional, yet her courage is the stuff epics are made of. She sacrificed everything to defend the ideals of socialism from Nazi invaders.

An overrated book?
I think Paulo Coelho is a highly overrated author. I got through one book, but didn’t want to go back and get another one by him. I think that Taslima Nasrin’s Lajja is quite overrated, but I do admire her opinion and strength.

A book you read recently?
I have been terribly busy, so I only read when I’m travelling! I read A Thousand Splendid Suns and liked it a lot. It had a great personal touch.

Sharanya Deepak