[BITList] India and China in the Next World Order

[John Feltham]

G'day folks,


I liked the analysis in this article.



http://www.nytimes.com/2009/01/02/opinion/02das.html?_r=1&th&emc=th

THE NEW YORK TIMES

The Next World Order

By GURCHARAN DAS
Published: January 1, 2009
New Delhi

CHINA and India are in a struggle for a top rung on the ladder of  
world power, but their approaches to the state and to power could not  
be more different.

Two days after last month's terrorist attack on Mumbai, I met with a  
Chinese friend who was visiting India on business. He was shocked as  
much by the transparent and competitive minute-by-minute reporting of  
the attack by India's dozens of news channels as by the ineffectual  
response of the government. He had seen a middle-class housewife on  
national television tell a reporter that the Indian commandos delayed  
in engaging the terrorists because they were too busy guarding  
political big shots. He asked how the woman could get away with such a  
statement.

I explained sarcasm resonates in a nation that is angry and  
disappointed with its politicians. My friend switched the subject to  
the poor condition of India's roads, its dilapidated cities and the  
constant blackouts. Suddenly, he stopped and asked: "With all this,  
how did you become the second-fastest growing economy in the world?  
China's leaders fear the day when India's government will get its act  
together."

The answer to his question may lie in a common saying among Indians  
that "our economy grows at night when the government is asleep." As if  
to illustrate this, the Mumbai stock market rose in the period after  
the terrorist attacks. Two weeks later, in several state elections,  
incumbents were ousted over economic issues, not security.

All this baffled my Chinese friend, and undoubtedly many of his  
countrymen, whose own success story has been scripted by an efficient  
state. They are uneasy because their chief ally, Pakistan, is  
consistently linked to terrorism while across the border India's  
economy keeps rising disdainfully. It puzzles them that the anger in  
India over the Mumbai attacks is directed against Indian politicians  
rather than Muslims or Pakistan.

The global financial crisis has definitely affected India's growth,  
and it will be down to perhaps 7 percent this year from 8.7 percent in  
2007. According to my friend, China is hurting even more. What really  
perplexes the Chinese, he said, is that scores of nations have engaged  
in the same sorts of economic reforms as India, so why is it that it's  
the Indian economy that has become the developing world's second best?  
The speed with which India is creating world-class companies is also a  
shock to the Chinese, whose corporate structure is based on state- 
owned and foreign companies.

I have no satisfactory explanation for all this, but I think it may  
have something to do with India's much-reviled caste system. Vaishyas,  
members of the merchant caste, who have learned over generations how  
to accumulate capital, give the nation a competitive advantage.  
Classical liberals may be right in thinking that commerce is a natural  
trait, but it helps if there is a devoted group of risk-taking  
entrepreneurs around to take advantage of the opportunity. Not  
surprisingly, Vaishyas still dominate the Forbes list of Indian  
billionaires.

In a much-discussed magazine article last year, Lee Kwan Yew, the  
former prime minister of Singapore, raised an important question: Why  
does the rest of the world view China's rise as a threat but India's  
as a wonderful success story? The answer is that India is a vast,  
unwieldy, open democracy ruled by a coalition of 20 parties. It is  
evolving through a daily flow of ideas among the conservative forces  
of caste and religion, the liberals who dominate intellectual life,  
and the new forces of global capitalism.

The idea of becoming a military power in the 21st century embarrasses  
many Indians. This ambivalence goes beyond Mahatma Gandhi's nonviolent  
struggle for India's freedom, or even the Buddha's message of peace.  
The skeptical Indian temper goes back to the 3,500-year-old "Nasadiya"  
verse of the Rig Veda, which meditates on the creation of the  
universe: "Who knows and who can say, whence it was born and whence  
came this creation? The gods are later than this world's creation. Who  
knows then whence it first came into being?" When you have millions of  
gods, you cannot afford to be theologically narcissistic. It also  
makes you suspect power.

Both the Chinese and the Indians are convinced that their prosperity  
will only increase in the 21st century. In China it will be induced by  
the state; in India's case, it may well happen despite the state.  
Indians expect to continue their relentless march toward a modern,  
democratic, market-based future. In this, terrorist attacks are a  
noisy, tragic, but ultimately futile sideshow.

However, Indians are painfully aware that they must reform their  
government bureaucracy, police and judiciary — institutions,  
paradoxically, they were so proud of a generation ago. When that  
happens, India may become formidable, a thought that undoubtedly  
worries China's leaders.

Gurcharan Das is the author of "India Unbound."

A version of this article appeared in print on January 2, 2009, on  
page A23 of the New York edition. 
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