VCheng
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I am sorry but I strongly disagree with you.
What you propound is what we have practiced in India for the better part of 2.5 decades.
That India would be the first and one of the few countries in the world who skip the massively polluting and degrading/demeaning/low wage factories stage of development and jump straight to the services sector.
This thought was firmly ingrained in the minds of policymakers for as long.
Today, we realize, we committed the biggest mistake possible. We realize that to create $1 in services sector requires lesser number of people than to create the same amount by manufacturing.
And so...we are left with a massive number of people who are unemployed, who cannot be absorbed by the Services sector.
And look at China, they chose the other route - the conventional route. And they have tasted better success than us.
Today, in case you donot know - we are literally running after increasing manufacturing sector in India. Our biggest projects since independence have been launched, the biggest loans and grants taken from sources as different as WB and Japan, just for one goal - create a manufacturing sector.
Why do you think that is?
My comment that "the days of relying on low quality labor to form the basis of a national economy will soon be over" was applicable only to Pakistan. India and China are very different scenarios.