Superpower? The Amazing Race Between China's Hare and India's Tortoise
Allen Lane R699, pp 242
There is much talk of a race between India and China. The truth is that both countries pay remarkably little attention to each other, except in a few military and diplomatic arenas. Neither side is impressed by the other’s political systems and draws curiously few lessons from the other's economic policies.
But the idea of two Asian giants caught in a giant nation-state rivalry makes good copy. Media magnate Raghav Bahl attempts to dig a little deeper, comparing the Indian tortoise and the Chinese hare. The two are compared at various levels, showing where one has an advantage and the other one is shackled. There is a set of interesting case studies of how the two handled areas like power, civil aviation and railways — generally with India getting the worse of it.
This is a fast moving text, at times veering close to incoherence. Skipping through history, geopolitics, demography, entrepreneurship, different bits of the economy, it tosses up a lot of data, a fair number of quotes (some of which are repeated) and an honest share of unanswered questions.
The potted comparison of the two countries' stockmarkets and the dissection of their consumer patterns and classes are segments worth reading. The chapter on geopolitics, however, is cringe-worthy. The comparison of entrepreneurship, especially given how Beijing confines the private corporate sector for political reasons and New Delhi does the same through inefficiency, leaves too many strings untied. Unfortunate, given that it's the private corporate sector that will probably decide which country will come up trumps on the economic side.
Some of the best parts of the book are when Bahl, drawing in part on his personal experiences, moans about the "dysfunctional Indian State". There is the corrupt politician and the Indian bureaucrat who uses his intelligence to "stay clear of anything that is even remotely controversial, breakthrough or bold". There is no serious attempt to draw parallels with the Chinese system where Beijing has crafted a culture where mandarins are incentivised to taking calculated risks. Why is India ‘process-driven' and China ‘results-driven'? No clear answer is given.
Another good point is that while China has plenty of economic failings, it has the ability to paper over the cracks with thick layers of money. "What if you pump so much capital into your economy — similar to putting fuel into a rocket — that you escape the gravitational pull of low thresholds?"
But one has to mine the narrative to find these nuggets. One doesn't emerge with a clear answer about 'India vs China'. Bahl can't make up his own mind, though he seems more impressed by China. "I would say it is 'advantage' China on velocity and momentum, and it's 'odds on India' as the institutional favourite. But the ultimate outcome is still anybody's guess — it's Fifty Fifty." Which is a good description of the book as well.