Friday, November 04, 2005

China, India Superpower? Not so Fast!

Via Replikk:

China, India Superpower? Not so Fast!

While there is no doubt about the great potential of these two economies in the rest of this century, severe structural and institutional problems will hobble them for years to come. At this point, the hype about the Indian economy seems patently premature, and the risks on the horizon for the Chinese polity – and hence for economic stability – highly underestimated. Both China and India are still desperately poor countries. Of the total of 2.3 billion people in these two countries, nearly 1.5 billion earn less than US$2 a day, according to World Bank calculations. What about the hordes of Indian software engineers, call-center operators, and back-room programmers supposedly hollowing out white-collar jobs in rich countries? The total number of workers in all possible forms of IT-related jobs in India comes to less than a million workers – one-quarter of one percent of the Indian labor force.

China's authoritarian system of government will likely be a major economic liability in the long run, regardless of its immediate implications for short-run policy decisions. China is far behind India in the ability to politically manage conflicts, and this may prove to be China's Achilles' Heel. Over the last fifty years, India's extremely heterogeneous society has been riddled with various kinds of conflicts, but the system has by and large managed these conflicts and kept them within moderate bounds. For many centuries, the homogenizing tradition of Chinese high culture, language, and bureaucracy has not given much scope to pluralism and diversity, and a centralizing, authoritarian Communist Party has carried on with this tradition. There is a certain pre-occupation with order and stability in China (not just in the Party), a tendency to over-react to difficult situations, and a quickness to brand dissenting movements and local autonomy efforts as seditious, and it is in this context that one sees dark clouds on the horizon for China's polity and therefore the economy. We should not lose our sense of proportion in thinking about the rise of China and India. While adjusting its economies to the new reality and utilizing the new opportunities, the West should not overlook the enormity of the economic gap that exists between it and those two countries (particularly India). There are many severe pitfalls and roadblocks which they have to overcome in the near future, before they can become significant players in the international economic scene on a sustained basis.


At November 04, 2005 2:00 AM, Blogger sissyblue said...

This sounds like a lot of PC BS, blah, blah, blah. Let the people have a democracy and let the chips fall where they may. Freedom finds it's own high water lines.

At November 05, 2005 5:12 PM, Blogger bordergal said...

Don't forget China's SEVERE environmental problems.

There have been riots over the effects of pollution on the people, soil, and water.....
for example, in one town the agricultural soil was devastated by toxic heavy metals, the crops lost.

They have huge water problems, with much of their water supply being non potable due to pollution.

You can't foul your own nest and expect to survive. Mother Nature isn't that forgiving.

Hooray for US environmental laws!!!


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