An Indian’s Perspective on China’s Rise - What India can learn from China

As an Indian who has spent the past six years in China, I have been blessed to experience life in two of the most populous countries in the world. From the 1980’s where the two countries struggled to keep pace with their western counterparts in the GDP race to the 2000’s where they quickly climbed spots thanks to technology facilitating participation from the masses in consumption and growth, China and India are well poised to become the largest economies in the next two decades.

Even though India and China more or less had the same starting point, China did a sprint in the past three decades leaving India way behind. China’s economy is now four times the size of India. I do see some comments on how India is now growing faster than China. However a 7.5% growth rate on the base GDP of India is incomparable to the 6.5% GDP growth China’s GDP base.

What made China the winner I had to ponder...

What measures did China take to lift a whopping 800 million people out of poverty in the past thirty years? - https://www.business-standard.com/article/international/china-lifting-800-million-people-out-of-poverty-is-historic-world-bank-117101300027_1.html

A few thoughts are shared here on how China pulled it together and what India can/should do to grow faster.

A. Heavy Injection of Capital into infrastructure development in the 80’s until now

As much as critics view China’s heavy investments in infrastructure development as inefficient, this was probably the pivotal step towards mobilizing the economy during the early days of growth. The socio economic reforms in the 80’s when China opened up for foreign companies coupled with investments in the best in class infrastructure extended even to tier 2 and tier 3 cities, saw to the much needed cash injection/circulation into China's economy. Well it came at a price. A price of being the ‘Factory of the world’ for close to two decades. However what had to be noted was that, there were boundaries that China managed to maintain, only allowing as much ‘foreign participation’ in their economy as much as it would take to grow, however ensuring the autonomy still remained within China.

B. Secured the Digital Revolution within China

While the western companies managed to own and reap the benefits of industrial revolution, there was a conscious decision in China to make sure the digital revolution will be owned and orchestrated within China by Chinese companies. Regulations were put in place to make sure ‘none from outside’ survived. And that was the beginning of what we see today as China’s emergence in the world’s center stage as an economic powerhouse. China has clearly moved on from a manufacturing based economy to a consumption based economy with more than 300 million new middle class participating in driving the consumption thus making sure growth is maintained.

C. Technology used for inclusive growth across the various social strata

From an imitation economy China hustled to innovate. Starting from improvising on existing technology to pioneering innovation within the country, China has come a long way. Yet another initiative is the matured businesses in China making it a priority to build models that will ensure participation of the people in the rural communities. Meticulous efforts are made to evaluate, invest and implement projects that will make sure the agrarian community are offered opportunities to participate in the digital economy. https://www.sciencedirect.com/science/article/pii/S1043951X18301 10X

D. Speed of Execution

Things once decided get executed like clockwork. In China once a plan is set forth, everyone associated with execution are committed to complete their part in the stipulated time unlike many other developing countries where things take their own sweet time to get started leave alone seeing completion! I remember a much needed flyover took two plus years to finish in Bangalore, India before I moved to China where I witnessed an entire middle ring road getting completed in a matter of a few months.

Conclusion

To sum up, I would reckon a few carefully crafted steps well executed across the past three decades, got China to where it is today. A formidable super power in the making, China now stands tall and well respected (can I also say envied) among the world nations. India with its population expected to be the youngest and the largest in the world, in the coming decade, also stands a chance. If not to rise as a super power to at least lift a considerable chunk of the population from poverty and low income levels.