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17 July 2013

Nice, democratic, entrepreneurial India: the unhappy truth

Not so long ago, China and India were often mentioned in the same breath – the emerging industrial giants that were set to dominate the 21st century. It’s now clear that the Indian tiger lags the Chinese dragon by some distance.

In fact, the notion of anything approaching an equal contest can be seen as a matter of wish fulfilment – and not just on the part of the Indians. Many westerners have looked hopefully upon India as a friendly, democratic counterweight to the scary, Communist monolith on the other side of the Himalayas.

For a more sobering view of the largest English-speaking country in the world, you could do a lot worse than William Dalrymple in the New Statesman and his review of a new book by the Indian economists Jean Drèze and Amartya Sen:

  • “Their thesis is simple: India’s failure to equal the success of China’s hyper-development is due in large part to the failure of the state to provide ‘essential public services – a failing that depresses living standards and is a persistent drag on growth’”.

There’s no doubting India’s enormous potential though:

  • “Between 1991 and 2001, as the Indian economy trebled in size, the country’s IT sector alone earned almost $50bn a year, mostly in export revenues. Part of those profits were spent buying prestigious foreign businesses – for example, the much trumpeted acquisition of Jaguar and Land Rover by Tata Motors.
  • “Some of this continues today. Average incomes were projected to continue doubling every ten years. The number of mobile phone users has jumped from three million in 2000 to 100 million in 2005 and 929 million in 2012…. In 2006, 23 Indians appeared on the Forbes list of the world’s billionaires; this year, the figure had more than doubled to 55.”

All of this in a country whose population is set to overtake China’s within fifteen years. And yet any comparison to China – or the other ‘BRIC’ nations of Brazil and Russia – cannot overlook the sheer crushing burden of Indian poverty:

  • “Even today, a third of Indians do not have electricity, compared to 1 per cent in China. ‘Half of Indian homes remain without toilets, forcing half of all Indians to practise open defecation.’ Wages in manufacturing in China have grown by 12 per cent since 2000, compared with 2.5 per cent in India… Brazil, with much slower economic growth, has a far better record of poverty reduction. India remains an oddity among the Bric countries: ‘India’s per capita GDP is less than half of China’s, one third of Brazil’s and one fourth of Russia’s.’”

The worst thing is just how much of this is needless:

  • “Every year, more children die in India than anywhere else in the world: 1.7 million children under the age of five, largely from easily preventable illnesses such as diarrhoea. Of those who do survive until the age of five, 48 per cent are stunted as a result of a lack of nutrients: child malnutrition in India is higher than in Eritrea.”

And how about this as an indictment of successive Indian governments:

  • “‘More than 40 per cent of South Asian children (and a slightly higher proportion of Indian children) are underweight in terms of WHO norms, compared with 25 per cent in sub-Saharan Africa.’”

There’s a dilemma here for western aid programmes. A malnourished Indian child is surely as deserving of our help as one in Africa. But can aid to a country that can find the money for its own spaceflight programme be justified? The British government thinks not, with Justine Greening’s recent announcement that Britain’s bilateral aid to India will be phased out by 2015.

One thing is for sure. India is wasting its most valuable resource – it’s people.


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