The Telegraph’s International Business Editor, Ambrose Evans-Pitchard, compares two different pictures of the world in 2050 and the two giants’ places in it:
The economies of China and India [according to Citigroup’s Willem Buiter] will together be four times as large as the United States, restoring the historic order of Asian dominance before Europe’s navies burst on the scene in the 16th Century. Panta Rei, says Dr Buiter: all is in flux; nothing will remain the same ….
Having rid themselves of calamitous nonsense – Maoism, the Hindu model, and other variants of central planning or autarky – and having at last achieved a “threshold level” of law and governance, nothing should stop them, or so goes the argument ….
HSBC’s report also sketches an era of unparalleled prosperity, yet the West does not sink into oblivion. China overtakes the US, but only just, and then loses momentum ….
Americans remain three times richer than the Chinese in 2050. The US economy still outstrips India by two-and-a-half times. This is an entirely different geo-strategic outcome.
Demography, naturally, is one of the main factors underlying these scenarios. At Reason, Shikha Dalmia contrasts China’s hukou restrictions and population controls with India’s more liberal policies, speculating on their likely consequences:
… India’s infrastructure issues, while difficult, are nothing compared to the problems China faces in assimilating its migrants. That’s because half-a-century of social engineering has decimated China’s civil society, something that will be much harder to rebuild than roads and power lines.
China’s one-child policy has undermined the safety net that the elderly normally rely on in traditional societies. This is one problem India does not have thanks to its democracy that put a decisive end to its brief flirtation with draconian population control through enforced sterilization in the 1970s. Hence, India’s tightly-knit extended family structure is largely intact, a gift of freedom to the country’s elderly.
Since China no longer has such a private safety net, its aging migrants will need a public one—just what hukou denies them. If China fails to extend hukou benefits, its large and disaffected underclass of deracinated, rural population might become a political tinderbox, ready to explode ….
China, then, has not yet fully absorbed the consequences of destroying its civil society—and India hasn’t yet fully reaped the rewards of letting its flourish. So when it comes to looking after the most vulnerable, appearances aside, India’s pell-mell democracy might yet outperform China’s hyper-rational autocracy.
