Can India surpass China as Asia's fastest growing economy ? Gwynne Dyer

[Indo-guy]

Not just a new regime, it's a new era: Nearly half of Narendra Modi's team to be sworn in today - The Times of India


NEW DELHI: There could not have been a more telling statement of a power shift at the Centre. A day before the 50th death anniversary of first Prime Minister Jawahar Lal Nehru, President Pranab Mukherjee will swear in as PM a leader who has led the most successful political assault on the Nehruvian consensus, India's governance mantra since Independence barring the NDA interlude.
Narendra Modi's eight-month-long campaign, which culminates at 6pm today with his swearing-in as India's 15th Prime Minister, has seen him casting himself as a legatee of fellow Gujarati Vallabhbhai Patel and insisting that the Sardar had deserved to be, and would have made a better PM than Nehru.
Modi is not coming in as a revolutionary out to upturn the established order, but there is little doubt that Rashtrapati Bhavan's looming masonry will be witness to not just a change of regime, but perhaps a change of era and of political discourse. If the reports that have appeared in the media, including this paper, are any indication of the shape of things to come, then the 63-year-old leader can be expected to upset the status quo. For some, it promises to be exciting, for others, unsettling.




Along with Modi, around 40 ministers from BJP and allies are expected to be sworn in — about half the sanctioned numbers of the council of ministers pegged at 15% of the Lok Sabha strength.
The representation from allies will be restricted, with prominent leaders like Ramvilas Paswan of LJP, Anant Seethe of Shiv Sena and Ashok Gajapathi Raju of TDP likely to take oath. A later expansion will see allies being given full representation.
But these could end up as almost incidental details in the unspooling political change. Having led NDA to an unprecedented 336 seats of which BJP won 282, Modi's swearing-in marks the arrival of a leader who revels in his 'outsider' status and is an enigma for Delhi's entrenched durbari culture.


A Modi government is likely to be rather different from the previous NDA regime under Atal Bihari Vajpayee that retained several comforting elements of continuity shared with the regimes it replaced. It defied conventional wisdom by conducting nuclear tests and pushing reforms, particularly in disinvestment and insurance. But Vajpayee was too much of a Dilliwala to really rattle the cage.



Modi, in contrast, promises to be a disruptor and shake up the Lutyen's Delhi with his bold and unconventional initiatives. To that extent, the inauguration will mark not just mark a shift of power, but also a change of governance style and political culture.


By pulling off what had looked like an impossible feat of winning a majority for the BJP on the strength of his persona and campaign style, Modi will have the authority and the headroom to go about his task. The uncertainty about whether even BJP's biggies will get heavyweight portfolios is a testament to his clout. Party circles believe that the composition of the ministry will generate headlines of the kind that will dwarf even the presence of Pakistan's Nawaz Shairf and other Saarc heads of state/government.
Viewed together with the changes in the BJP which will follow shortly to bring the party in line with his priorities, as also the fact that BJP's numbers have spared him of "coalition compulsions", Modi's premiership will mark the return of a leader cast in the presidential mould of Indira Gandhi.
Modi has made his intention clear in diverse ways; by demonstrating that selection of his team was indeed the PM's prerogative and by essaying a bold foreign policy initiative by getting leaders of countries in the neighbourhood and Mauritius to attend the ceremony. In a symbolic way, it also marks the restoration of Delhi as the centre of Saarc after a period of long retreat.



Modi's campaign foreshadowed the impending change as he told voters he felt he had been chosen by God to do a "difficult task" and promised to replace the business-as-usual culture with purposeful governance. A belief that he is touched by destiny may prove handy after he takes oath at the head of what is expected to be a compact team of ministers as his challenge lies in meeting elevated expectations.
As reported by TOI earlier, senior BJP leader Arun Jaitley and BJP chief Rajnath Singh are expected to be finance and home ministers. Senior leader Sushma Swaraj may be in a cabinet committee on security ministry. While L K Advani's expectation to be the Speaker may go unfulfilled, another veteran Murli Manohar Joshi is in the running for the constitutional position or a fairly important ministry. Other names being mentioned for the post of Speaker include the MP from Indore, party veteran Sumitra Mahajan.
Other likely inclusions are Nitin Gadkari who is tipped to get an important infrastructure ministry, Ananth Kumar, Piyush Goel, Karia Munda, Harsh Vardhan, Uma Bharti and former party chief M Venkaiah Naidu.


An astute scene stealer, Modi has turned the swearing-in into a power statement, signaling his readiness to work with neighbours and their acceptance of his ascendance.
If his energetic campaign during which he addressed more than 450 meetings and hundreds more 3-D or hologram rallies is an indication, Modi is driven by a political ambition that is unlikely to be sated easily. The nature of his mandate means that despite accommodating leaders who may not be comfortable with, Modi is likely to hold the aces. Typical to his nature, he has held his cards close to the chest.
He is sure to target several objectives — consolidating support within BJP, keeping political rivals on the back foot, and setting timelines for political and administrative goals. In the midst of his much-talked-about "sadbhavna yatra" ahead of the 2012 Gujarat polls, Modi told a confidant that much of the campaign would be over before the opposition figured out what he was up to.

The impressive political machine Modi's managers like Amit Shah and a web of professionals set up and which transformed BJP's moribund organization into a fighting unit, is not about to be wound up. Going by his record in Gujarat, the new PM is likely to rely on BJP's organizational network and other non-government platforms to involve people in his government's programmes.
As chief minister, he set aside time to participate in programmes like enrolment of girl children and farm melas, events that were as much official as party business. As his political plans do not end with his current term, he will have learnt from the helpless situation UPA found itself in despite undertaking gigantic welfare programmes like rural job guarantee and food security.

 

[Indo-guy]

Gwynne Dyer: Can India surpass China as Asia's fastest growing large economy? | Georgia Straight, Vancouver's News & Entertainment Weekly


Soon after winning an absolute majority in the Indian parliamentary elections, prime minister-elect Narendra Modi promised “to make the 21st century India’s century”.

If he can avoid tripping over his own ideology, he might just succeed.
“India’s century” is a misleading phrase, of course, because no country gets to own a whole century. It wasn’t ever really going to be “China’s century” either, although China is a huge country whose economy has grown amazingly fast over the past three decades. What Modi meant was that India, the other huge Asian country, may soon take China’s place as the fastest growing large economy—and it might even surpass China economically, in the end.
At first glance this seems unlikely. India’s GDP is currently less than a quarter of China’s although the two countries are quite close in population (China 1.36 billion, India 1.29 billion). Moreover, the Chinese economy’s growth rate last year, although well down from its peak years, was still 7.7 percent, while India’s grew at only 4.4 percent.
But China’s growth rate is bound to fall further for purely demographic reasons. Due partly to three decades of the one-child-per-family policy, the size of its workforce is already starting to decline. Total population (and hence total domestic demand) will also start to shrink in five years’ time. And this doesn’t even take into account the high probability of a financial crash and a long, deep recession in China.
India’s growth rate has also fallen in recent years, but for reasons like corruption, excessive regulation, and inadequate infrastructure that are a lot easier to fix. And the reason that Narendra Modi’s Bharatiya Janata Party (BJP) won by a landslide was precisely that voters thought he would be better at overcoming these obstacles to growth than the worn-out and deeply corrupt Congress Party.
Modi did not win because a majority of Indians want to pursue divisive sectarian battles that pit Hindus against India’s many minorities, and especially against Muslims. That has always been part of the BJP’s appeal to its core voters, but its new voters were attracted by Modi’s reputation as the man who brought rapid development to the state of Gujarat, which he has ruled for the past 13 years. They want him to do the same thing nationally.
They overestimate his genius: Gujarat has always been one of India’s most prosperous states, and the local culture has always been pro-business. It was doing very well even before Modi took power there. Nevertheless, he might well be able to fulfill the hopes of his new supporters, for he arrives in New Delhi without the usual burden of political debts to special interests.
The BJP’s absolute majority in parliament means that Modi will not be constrained by coalition allies like previous BJP governments. This could lead to a leap in the Indian growth rate if he uses his power to sweep aside the regulations and bureaucratic roadblocks that hamper trade and investment in India.
He also has a golden opportunity to crush the corruption that imposes a huge invisible tax on every enterprise in the country.
Unfortunately, his extraordinary political freedom also means that he will find it hard to resist the kind of sectarian (i.e. anti-Muslim) measures that the militants in his own party expect. He cannot use the need to keep his coalition allies happy as an excuse for not going down that road. Nobody knows which way he’ll jump, but it might be the right way.
Even some Muslims in Gujerat argue that Modi has changed since he failed to stop the sectarian riots that killed around a thousand Muslims there in 2001. Moreover, the election outcome makes it clear that a considerable number of the country’s 175 million Muslims must actually have voted for him. If he can keep his own hard-liners on a short leash, everybody else’s hopes for a surge in the economic growth rate may come true.
What might that mean over the next decade? It could mean a politically stable India whose growth rate is back up around seven or eight percent—and a China destabilised by a severe recession and political protests whose growth rate is down around four percent.
While neither political stability in India nor political chaos in China are guaranteed in the longer run, by 2025 the demography will have taken over with a vengeance. China’s population will be in decline, and the number of young people entering the workforce annually will be down by 20 percent and still falling. India’s population will still be growing, as will the number of young people coming onto the job market each year.

That will give India a three or four percent advantage in economic growth regardless of what happens on the political front.

In the long run both countries may come to see their massive populations as a problem, but in the medium term it looks increasingly likely that India will catch up with and even overtake China in economic power.

Gwynne Dyer is an independent journalist whose articles are published in 45 countries.

 

[Indo-guy]

India could conceivably pass China in economic power - Columnists - Cape Breton Post

 

[mike2000]

wtf, is wrong with these our western media? they have been saying this for decades now. im tired of hearing this. They are trying to make India complacent. why not just wait when India surpass China before start talking prematurely about 'may' surpass in future? It will just make India look bad if/when they dont surpass it by that time. So they should just leave India alone, we have our own problems here as well. India has done quite well giving its infrastructure/government policies. Lets just hope it does better when things improve in this two apsects.

 

[HariPrasad]

wtf, is wrong with these our western media? they have been saying this for decades now. im tired of hearing this. They are trying to make India complacent. why not just wait when India surpass China before start talking prematurely about 'may' surpass in future? It will just make India look bad if/when they dont surpass it by that time. So they should just leave India alone, we have our own problems here as well. India has done quite well giving its infrastructure/government policies. Lets just hope it does better when things improve in this two apsects.

Many of indian states have hit GDP growth 12% which has a better government and governance. I am not talking about the already progressed state like Gujarat but the backward states like MP, Chhatisgarh, bihar etc also. If we can have good government at state and center, we can certainly surpass 10% figure easily. I foresee at least 8% growth rate from next F Y which is more than what China has at present.

 

[mike2000]

Many of indian states have hit GDP growth 12% which has a better government and governance. I am not talking about the already progressed state like Gujarat but the backward states like MP, Chhatisgarh, bihar etc also. If we can have good government at state and center, we can certainly surpass 10% figure easily. I foresee at least 8% growth rate from next F Y which is more than what China has at present.

well some chinese provinces in the western regions have grown even more than 12%. Anyway, i dont want to start going into details here/comparism about growth in the 2 countries because i dont think it will never end. IMO. what i just want to say is that our Media should stop this India vs China comparism. They have ulterior motives doing this. You should ask yourself why they dont compare Germany vs France. or britain Vs France all the time. Afterall, Germany and France(and Britain as well) have fought bloody wars several times between themselves(china and India just once as far as i know) and the gap between their economies isnt that large as the gap between India and China. so why dont hey keep comparing France and Germany together? Afterall, China is now almost 5 times bigger than India economically. So even if it grows just 1or 0.5 percent more than India, the Difference will still be HUGE. same with Britain and France, they dont compare us with France everytime, even though France is just a little bit bigger economically than Germany(by a few hundred billion dollars).
So India should be careful about all this Comparism or superpower talk trying to make it complacent. Just focus on improving your living standards and infrastructure, after doing that, when you have reached a certain level of development the world will noticed it. You dont have to brag or seek attention. yuour development will speak for itself no matter how others hate/might be jealous of it, they will have to accept it, just like they have with China. So i will advice India to continue on its path of seeking to improve its people living standard(afterall you still have the highest number of poor/hungry people in the world, even more than all subsaharan Africa combined). So with all these talking of overtaking China is just to make India feel good, nothing good comes out of it.
So focus on your country and stop being obsessed wkith China or any other country, they have their own issues as well. Afterall, i dont see china comparing itself with India everytime. The government there is more focus on improving the country living standards and move the economy up to a more sutainable high tech industry. India still a long way to go, to be were china is even today(assuming china wont move or change in the coming years/decade).
Anyway, as i said, India has done quite well this past decade. its just that China has done even far more better in all apsects. if there was no China, then India will have been the star. its just that China kind of overshadows India and make people forget all what India has achives giving its limited capital/infrastructure. Afterall, china has undergone the most rapid development/indutrialisation in human History. So india coming second to that isnt bad at all. Had India growth come in a different century then it will have been the growth story star. so India should feel proud but at the same time humble of its achievements and strive to acheive more. So i wish good luck to India, since i know it still has alot of potential.

 

[HariPrasad]

well some chinese provinces in the western regions have grown even more than 12%. Anyway, i dont want to start going into details here/comparism about growth in the 2 countries because i dont think it will never end. IMO. what i just want to say is that our Media should stop this India vs China comparism. They have ulterior motives doing this. You should ask yourself why they dont compare Germany vs France. or britain Vs France all the time. Afterall, Germany and France have fought bloody wars several times and the gap between their economies isnt that large as the gap between India and China. so why dont hey keep comparing them togther? Afterall, China is now almost 5 times bigger than India economically. So even if it grows just 1or 0.5 percent more than India, the Difference will still be HUGE. same with us and France, they dont compare my country with France everytime, even though France is just a little bit bigger economically than Germany(by a few hundred billion dollars). So India should be careful about all this Comparism or superpower talk trying to make it complacent. Just focus on improving your living standards and infrastructure, after doing that, when you have reached a certain level of development the world will noticed it. You dont have to brag or seek attention. yuour development will speak for itself no matter how others hate/might be jealous of it, they will have to accept it, just like they have with China. So i will advice India to continue on its path of seeking to improve its people living standard(afterall you still have the highest number of poor/hungry people in the world, even more than all subsaharan Africa combined). So with all these talking of overtaking China is just to make India feel good, nothing good comes out of it.
So focus on your country and stop being obsessed wkith China or any other country, they have their own issues as well. Afterall, i dont see china comparing itself with India everytime. The government there is more focus on improving the country living standards and move the economy up to a more sutainable high tech industry. India still a long way to go, to be were china is even today(assuming china wont move or change in the coming years/decade).

You didn't understand me properly. i said the states which were doing badly (Known as BIMARU states) started performing excellently after the change of government. I only say that a proper government makes a big difference. A good government at center can easily push GDP to above 8 % (Like Mr. Vajpayee had done) If state government contributes aggressively, we can push the growth rate above 10%. Reat assured it will be at least 8% in Mr. Modi's regime on an average .

China is now almost 5 times bigger than India economically. So even if it grows just 1or 0.5 percent more than India, the Difference will still be HUGE

Yes but not in PPP. Strengthening of INR against USD will narrow this gap rapidly. Rupee have strengthen RS 10 against USD in last 8 months from 68 to 58.