At such an apparent historical inflection point, it is probably worth taking a step back and look at the patterns of global GDP share of major countries during last 500 years. (click on the chart for a full-size version)
It may be shocking to some people, but USA did not always have a 10 trillion dollar economy. It is probably not so surprising that the fall of India's share nicely corresponds with the rise of England's share. The fact that England started colonizing India precisly at that inflection point is of course a trivial coincidence. A significant chunk of East India Company's profits from India was invested in building the foundations of US economic growth as well.
Sadly India's curve did not change its trajectory immediately and dramatically after independence. Nehru's nightmarish socialist license-permit raj resulted in a chronic GDP growth of 3%. In economics literature, this is known as the "Hindu growth" which is simply outrageous. Apart from the fact that economic policies have nothing to do with religion, calling the output of his great policies "Hindu" would insult Nehru as he was decidedly very anti-Hindu. It is time to reclaim our history and use appropriate terminology. Henceforth the anemia of 1947-1980 will be known as the "Anti-Hindu Socialist Growth" and the plunders of British colonization between 1600-1947 will be known as the "Great Anglo-Christian Depression".
If I sounded skeptical about India and China's emergence out of colonialist, socialist and communist tyranny, that was not the intention. I am aware of the fundamental economic "revolution" that is currently happening in China. I have my doubts about what is happening in India and will ruminate on those later. Till then here are some very impressive statistics that highlight some of China's recent accomplishments.
2 comments:
Dipanjan, you do make a strong statement here about the "Chinese" economy. While I agree with you about the Nehru's socialistic policies bringing the nation to ruin, it's the second edition of this "ghost guided" economists that are pulling the nation down.
As for the Chinese, despite the statistics as they claim, the whole nation is being fuelled by disparities. China has seen a huge and massive influx from rural areas to the cities. This is bringing in it's own set of hassles. Then the official policy of one child norm being enforced is giving rise to the same problem of the "missing million girl child" as in India- sex selective tests are playing havoc with the established population profiles.
In anycase, the Infant Mortality Rate defines the health of the Economy which is still unacceptably high for a "developing Economy". Perhaps we share the same burden. In the Global Development Index, we are still at a platry rank of 127 with nations like Srilanka far ahead of us in Macroeconomic indicators.
I wouldn't trust the commies or the Chinese with the barge pole. Ever. Hence their statistics brought out by their own Government are a BIG suspect; just as the round of Economic Surveys. Despite the statistics, we are being taxed more, things cost more and we have looming energy crisis in the horizon.
GDP can grow if we tap rural areas uplift them (70% of population)
and do manufacturing
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