The rise of China and India, by numbers

Rhoda Klapp

These are the most stupid forecasts I've seen lately. There is just no way in hell that these graphs will be followed. Let Rhoda give you a clue, from the fifth of Rhoda's four principles: Things swing one way, then they swing back. Or more succinctly, BRIC today, PIIGS tomorrow.

Or to put it into economist talk, fast growth from a low base is easy, fast growth from a decent base is neither easy not desirable. PWC ought to seek out those who wrote this guff and put them to toilet cleaning until they see sense.

John Staples

Whatever happens to GDP, the US will remain a better place to live than China. Freer, less polluted, and considerably less over-crowded. China's mega-cities offer a pretty grim view of its future.

The one redeeming aspect of China is that its people are, in my experience, decent and friendly.

Pete Hoskin

Rhoda Klapp: well, I did say "slap health warnings aplenty across this"...

kinglear

Yes Rhoda - cockup theory of humanity. NOTHING turns out how it's expected, EVER

TrevorsDen

India and China were until recently (and still are in many areas) totally impoverished.
Is it any surprise that like in our industrial revolution, their economies take off.

We in the UK should be grateful that the international language is English (thanks to the power and influence of America) it will help us to secure a suitable piece of these emerging markets.
I read today that Jag-Land Rover sales are up thanks to sales in China.

We should be grateful that China and India are growing, though not pleased with the level of corruption in those countries - maybe that will change over time.

Oh - however if you believe in man made global warming you should want India and China to remain poor.

Raffles

Rhoda is bang on, this is utterly pointless and lazy forecasting. That said the general trend is obvious but very much an opportunity for the UK not a threat...as long as we keep the Reds out long enough that is.

Rhoda Klapp

Pete, I noticed the health warnings. That is why I reserve my scorn for PWC.

Whe none has been around for a few decades, one notices that these things, the ravings of enthusiasts, are always with us. I remember at school being urged to learn Russian. In the 70s and early 80s, it was the Japanese who were about to take over the commercial world. Now it is the Chinese and the Indians. It is unlikey to remain that way for long. But if they become rich and successful AND manage to circumvent the inevitable obstacles, it really is not a matter for concern that these nations or any others are bigger than us in any economiic terms, % of GDP, per capita, whatever. Good luck to them.

Verity's Weltanschuuang

TrevorsDen - "We in the UK should be grateful that the international language is English...".

The naiveté is breathtaking. Do you sincerely believe, in all your simplicity, that negotiations take place in the language of the salesman?

In India, perhaps, as a vast swathe of the population has been bilingual in Hindi and English for generations going way back, but CHINA??? You think they bother to learn English so they can understand the man carrying the sample case???

You think IKEA, for example, managed to negotiate the setting up of four flatpak furniture stores in China in English??? (Or, even more piquant, Swedish?) Or do you think the sales negotiator was fluent in Mandarin?

AB

PWC's point really shouldn't be that contraversial - China and India have very large populations, they are moving towards more market led economies and their populations are becoming less poor, the effect of this in terms of the coming shift in global economic power is fairly profound. China has already destroyed our low and mid end manufacturing base with its cheap imports, India is doing the same in services. Acquisitions (Jaguar Land Rover is now Indian owned), heavy investment in R&D; and a young/increasingly educated workforce mean that these nations and others, pose a substantial long term threat to the higher end goods and services we currently depend on. Some of us may be lucky enough to spend all day pontificating on the Spectator's comment pages, our children and grand children will need to find something more productive to do, what that something maybe is increasingly hard to predict.

andrew wilson

A Couple of Points.
To Verity's Weltanschuuang. I agree with your comment about Trevorsden and English, although not perhaps the exact point. English is spoken in India because, at Independance, the Govt. quite right thought that a common second language would help bind the place together. However, the Americans didn't teach English throughout North America or Africa or Australia or te smaller bits of the Commonwealth. I'd say that it's been useful for the Americans and the rest of us that this is so. We British dismiss our gifts to the World too lightly. A further point, I noticed in te 70's wi the Oil Shocks. One of my Indian friends was crowing that power had moved to the producer nations and the West would be beholding to those it had 'opressed'. I replied that this might be true in te short term, but the price will always be dictated by those who want to Buy rather than those who Sell, for sooner or later there will be alternatives / replacements. How that affects the Developed World will depend on how the BRICS Internal Markets grow i.e. Disposable / Convertable Income. It would be interesting to show in another graph, who / how much Tax is paid in these Countries. Where does the Money for the Infrastructure that Produces / Transports this Growth come from?

yank

Well, I have no argument with the thrust of PWC's projections, although as R.K. implies, you can throw them out the window at any moment, because we're always just a moment away from the next black swan, one we don't even know about right now. Hate to be a fatalist, but it is so.

Our strength is our culture. Little Guyana is a poor country, where my daughter and her husband took my infant granddaughter down to do ministry years ago... jungle piloting for the natives. I was mad as a hornet. They may have the love of Jesus in their eyes, but that won't save them if the fuel line cuts out over a bazillion square miles of rainforest, and who knows what those naked savages there had in the form of air traffic control, maintenance and emergency response.

One of my military pilot buddies, a grizzled guy with tons of worldwide experience, saw my distress and soothed me as follows. He said Guyana was a former Brit colony, and there would thence be structure. There would be civil order and direction. There would be some stiff uniformed type around at the airports, if not in the hinterlands, dark of pallor or otherwise, but providing common sense. And you know, it was so.

That's what's residue out there, and is resident at home as well, much as we've all tried so hard to throw it all away. I welcome the Chicoms to advance, and God bless them. They'd do well to absorb and spread around some of the blessings of liberty that are the truest foundation of the numbers we see in those graphs.

Niraj

Hi All, i am a young Indian & proud to be so. I am excited by the Indian growth story which are projected; however agree that we have still miles to go before we have an appropriate comparison between my country & the developed world. The overall growth rate & the GDP projection sounds sweet but i am more concerned with the distribution of wealth - Per Capita Income. I am aware that lot is to be desired, but one thing is sure that the wealth is now spreading. I am owning now the assets, which till 5 years back thought of it as a dream.

AG

There are two types of issues here

Macro Issues - Overall GDP, Economic and military strength, Global Leadership

Micro Issues - Quality of life for a citizen, Per capita GDP, etc

Macro Issues:
If US needs to keep pace, it needs to reform its immigration policy. US needs to retain the high skilled workers that come to work in US on temperory H1B visas. This will help on two accounts
1) Ensure US remains the center of innovation for the world.
2) Keep the population growing at a healthy rate. As such US is a sparsely populated country.
3) Orient education towards engineering and innovation rather than liberal arts

Micro Issues
US is already well placed on this account. However, there is always room for improvement. US could
1) Improve the quality of its public transport system.
2) Improve Health system to reduce costs on citizens
3) Reduce taxes

Sometimes a balance between macro and micros issues need to be done

Simple

Well...as crazy as it is to predict 40 years into the future, since the conclusions are quite obvious and predictable, my response as an Indian is "meh...."

As for jealous people like Rhoda, you should heed David Cameron's words when he came to India : "I have come to your nation in all humility. Your nation has the whole world beating a path to its door. But I believe Britain should be your partner of choice...blah blah blah". Britain's hand is weak to the point that they are trying to do diplomacy by making an emotional appeal to the Indian people... ha ha ..!!! And Britain's belief that India is full of goodwill for them owing to shared history is just precious. Britain and America also have "shared history". And, in his manifesto, Cameron called for a "special relationship" with India, a term formerly only used by Britain for the US-UK relationship. The word "poodle" sort of sums it up.

You can get as angry as you want, but the truth stands to light. Did you see what India did to your beloved game of cricket, the preserve of British royals? Who runs it today with an iron hand? You can squirm and moan and call names, but the Indian boot is pressing down hard on the erstwhile British Empire. You are very fortunate, with a mere 54 combat planes, to live in an era where violent conquest is considered a thing of the past.

Nick

Oh dear Simple, you really do live up to your name.

Whilst your size may give you power, you have to be able to use it in the right way.

When Britain had power and wealth, we at least did away with slavery, we started to provide universal benefits, old age pensions, we introduced a national health service.

I've seen Slumdog Millionaire. When will India catch up with the thing Britain was doing in the first hald of the last century ?

Also, we ahve far moer than 54 combat aircraft, in fact, we don't fly 40 year old MIGs either, but that is obvious to anyone with access to Google.

Rhoda Klapp

Look, I am not jealous of India, good luck to them all, I say. Personally I might put clean water for the people ahead of nuclear weapons, but that's just me. But to say that I should pay attention to the words of David Cameron? That I find offensive.

Niraj

My dear brother 'Simple', please don't sound to be rude to others. As we are growing [India], we need to inculcate 'humility'; as power comes with responsibility. My dear Brits, it's not jealousy which we expect, neither debate on comparison between the two great nations. Infact we wish you also share the growth story [considering that apart from 'Imperial' backage, you have also contributed to make India, what it is].One fact cannot be pushed under the carpet, the growth rate may be & is debatable; however considering the size & the nature of my country, we will grow significantly [i am not quantifying]in coming day. Good luck to all & god bless you.

Anikitos

"we will grow significantly"

That's a bold claim. With the alarming rate of poverty and corruption in India, there is a high chance that the country might fail in the end. The wealth distribution in India is ridiculous. There are people who build mansions upon mansions and then there are people dying from starvation, cold etc.
Government just brings out schemes that fail one after another and the education system is based on rote learning. Most of the kids drop out before they reach high school.
All these things tells us that no matter what you claim, India is booming only for 200 million people who are well off, for the rest of the billion people it hasn't changed much and probably won't change for a long time

pal

Do we think world leaders and their advisers are mad??

List of world leaders who stood in the que to be noticed by New Delhi. In the last 6 months following visited India

1 Barrack Obama
2 British Prime minister
3 French President
4 Chinese president
5 Japanese
I will stop here.

It is not so much of a worry that China and India will become Economic powerhouses. It is when they change the rules of the game( we recently saw that in Copenhagen) the reality will bite.
As far as the Slumdog Millionnair is concerned, it is a fiction and that's how it should be viewed. Anybody who visits India from the west can recognise that they cannot splash money like the young Indians do.

Niraj

Dear Anikitos,

I know you are disturbed by the growth story of India & that some how you wish to defend that it will never make it to the top. I don't wish to convince you, as the current facts & the trends would make it difficult for you to debate. Any way, to answer some of your observations [i presume, many of you would carry the perception of India as observed by dear Anikitos, as such the explanation].

Alarming rate of poverty and corruption in India, there is a high chance that the country might fail in the end.

Answer: I don't disagree that there is poverty & corruption; however we never claimed we have already achived the wealth parity of the west. In fact in 'poverty' we see opportunity & get motivation to expand & grow. Corruption is everywhere [even in your country]; we are working to improve & the civil society / media/ judiaciary are playing their respective role. I am sure you will find the positive change in the next 5 years on this front [i would assume that you understand that it takes some time for things to improve].

The wealth distribution in India is ridiculous. There are people who build mansions upon mansions and then there are people dying from starvation, cold etc.

Answer: Yes, partly it is true. We have issues of wealth distribution; however the same is in every capitalist economy. I am sure the wealth is bound to trickle down to the lower strata of the society in coming days [it is already happening]. Alternatively, do you wish to suggest, to achieve the income/ wealth parity that we should go back to 'Socialist' economy?

Government just brings out schemes that fail one after another and the education system is based on rote learning. Most of the kids drop out before they reach high school.
Answer: We have issues on the education system; however one cannot deny that the same education system has given some of the bright mind to the society [including yours]. Even Obama had appreciated the Indian education system & that we have brains to match the best in the world.

All these things tells us that no matter what you claim, India is booming only for 200 million people who are well off, for the rest of the billion people it hasn't changed much and probably won't change for a long time.
Answer: I do not know your nationality; however offers you to come to India & see yourself. The current growth is primarily driven by the rural India. So to grossly comment that the current growth has benefited the elite is absurd. I belong to lower middle class of India & that i can see many who are progessing due to opportunities.

If only dear Anikitos, you would have been gracious to accept the future trend & the growth region, you would had refrained from using such rude words.
We are aware that my country is having it's own share of weaknesses. We, the young generation is working towards improving & have resolve & ability to overcome the challenges.
Best wishes to all. Let your country also grow as well as you achieve the progress you desire.