India and China were really successful on nation-state building.In both countries nationalism arose against the defeats, humiliations and injustice these nations went through during the period of western imperialism. Both countries used western ideas to overthrow foreign domination.It is wise to avoid nationalism in India-China relations, as it is a double-edged sword.The AG2 framework will provide the institutional arrangements to secure the prevalence of wisdom over emotions in the bilateral relationship, writes Huang Jing in Business Standard.
Excerpts:
"Despite substantial cultural and religious diversity in both countries, India and China have been largely successful in nation-state building, as evidenced by the strong and unshakable national identity and pride among the Indians and Chinese."
"However, unlike western nationalism, which was associated with pride and jubilance for the triumph of capitalism and industrialisation, nationalism in both India and China arose due to defeats, humiliations and injustice endured during the age of western imperialism — India was under the British Raj and China was a victim of gunboat diplomacy."
"Ironically, the leading elites of the national movements in both India and China embraced western ideas and adopted western political methods in their fight to be rid of “foreign exploitation and operation”. Subsequently, these leaders led their countries towards the western path of modernisation. This deep-seated love-hate mentality towards the West and the bitter roots of their national consciousness have made the Indians and Chinese especially sensitive towards national sovereignty and independence — after all, they were determined never to let history repeat itself."
"In India-China relations, a wise and astute leader would want to avoid involving nationalistic sentiments on the issues — border disputes, trust deficit, mismatched geopolitical concerns, and inconsistent interests in energy, food and water security — that have handicapped the bilateral relationship. Doing so would only deprive the leaders of both the states of the rationality and manoeuvring room necessary for achieving a mutually acceptable solution for, or at least the practical management of, the existing problems in bilateral relations. Furthermore, playing the nationalism card would have dire consequences on political stability at home, as a nationalistic approach would, more often than not, benefit the extremists in domestic politics."
"Indeed, fast economic growth amidst globalisation has brought about an unprecedented transition in both China and India, giving rise to new contradictions, dilemmas and challenges, or exacerbating old ones, in domestic politics as well as bilateral relations."
"Both Delhi and Beijing must make a conscious commitment to contain nationalistic sentiments in the bilateral relationship, especially when the interests of the two countries are inconsistent or in conflict. Political leaders have to realise that playing the nationalism card would produce no benefits. As history has taught us repeatedly, nationalism is always a double-edged sword and it could potentially produce a backlash on those who ride on it for short-term gains."
"The simultaneous rises of the two great neighbouring powers have brought about unprecedented opportunities as well as challenges. The AG2 framework is to provide the institutional arrangements to secure the prevalence of wisdom over emotions in the bilateral relationship, so that the two nations can optimise the opportunities and handle the challenges with a rational and cool-headed approach."
Showing posts with label economic freedom. Show all posts
Showing posts with label economic freedom. Show all posts
Thursday, August 26, 2010
Friday, August 20, 2010
The Rise Of India
Excerpts from Asian Journal of Political Science, 20th August 2010 Edition:
"Compared to China Indian public policy still has a lot of room for improvements.
‘Maoists’ or Naxalites threaten political stability and economic freedom.
Geopolitics may explain India’s late, slow and incomplete reforms. The
rise of Asia, in particular of China and India, generates geopolitical challenges of its own.
Conceivably, the global expansion of economic freedom permits not only the rise of Asia,
but the peaceful management of the coming power transition between Asia and the West."
"China and India together account for almost 40 per cent of mankind. Once they joined the
capitalist market economies, capitalism became truly global.Mainland Asia is catching
up. According to Maddison (2007: 378, 381), in 1950 the Asian share of world
population was 54.7 per cent, but the Asian share of world gross domestic product
(GDP) was only 18.6 per cent. By 2003 the Asian share of global population had
increased to 59.4 per cent, but the Asian share of world GDP had more than doubled
and increased to 40.5 per cent. In 2003 the West still commanded 43 per cent of world
GDP, but contained only 12 per cent of global population (Maddison, 2007: 71)."
"From the 1950s to 1980 per capita incomes in India and China were fairly similar to
each other. Per capita incomes in both countries grew more slowly than globally
(Maddison, 1998: 40 41). Both of them pursued ‘leap-forward strategies’ which
focused on heavy industries in spite of capital scarcity and labour abundance.
Comparative advantage was neglected (Lin et al., 2003: chapter 2). It could not be
exploited until the focus on heavy industry and import-substitution was mitigated
or given up. Like China, India was afflicted with socialism and an emphasis on
planning.8 Of course, a comparative advantage defying development strategy would
have been impossible in a free and competitive market economy. A large involvement
of government makes big and persistent mistakes possible. Whereas China suffered
from the repressive and radical variety of socialism, India tried the democratic
variety. Both countries, even democratic India, more or less disengaged from the
global economy. In the late 1940s when India became independent, its share in
global exports was 2.4 per cent. In the early 1990s, it was only 0.4 per cent (Bhagwati,
1993: 58). "
"The poor performance of the world’s most populous countries was not inevitable.
In principle, both of them should have enjoyed the ‘advantages of backwardness’ and
should have benefited from ‘conditional convergence’ (Barro and Sala-i-Martin, 1995;
Helpman, 2004; Levine and Renelt, 1992; Levine and Zervos, 1993; Olson, 1996).
Although not all backward economies do converge, although not all of them exploit
the potential ‘advantages of backwardness’, in principle the followers of the global
development process enjoy some advantages over the pioneers. If they choose to do
so, they can benefit from the greater degree of economic freedom and development of
the more advanced countries (Weede, 2006). They may borrow technologies.9 They
easily find opportunities for productive investment and are less likely to run into the
problem of decreasing returns. They can reallocate labour from less productive
employment in agriculture to more productive employment in industry and, later, in
services."
"Compared to China Indian public policy still has a lot of room for improvements.
‘Maoists’ or Naxalites threaten political stability and economic freedom.
Geopolitics may explain India’s late, slow and incomplete reforms. The
rise of Asia, in particular of China and India, generates geopolitical challenges of its own.
Conceivably, the global expansion of economic freedom permits not only the rise of Asia,
but the peaceful management of the coming power transition between Asia and the West."
"China and India together account for almost 40 per cent of mankind. Once they joined the
capitalist market economies, capitalism became truly global.Mainland Asia is catching
up. According to Maddison (2007: 378, 381), in 1950 the Asian share of world
population was 54.7 per cent, but the Asian share of world gross domestic product
(GDP) was only 18.6 per cent. By 2003 the Asian share of global population had
increased to 59.4 per cent, but the Asian share of world GDP had more than doubled
and increased to 40.5 per cent. In 2003 the West still commanded 43 per cent of world
GDP, but contained only 12 per cent of global population (Maddison, 2007: 71)."
"From the 1950s to 1980 per capita incomes in India and China were fairly similar to
each other. Per capita incomes in both countries grew more slowly than globally
(Maddison, 1998: 40 41). Both of them pursued ‘leap-forward strategies’ which
focused on heavy industries in spite of capital scarcity and labour abundance.
Comparative advantage was neglected (Lin et al., 2003: chapter 2). It could not be
exploited until the focus on heavy industry and import-substitution was mitigated
or given up. Like China, India was afflicted with socialism and an emphasis on
planning.8 Of course, a comparative advantage defying development strategy would
have been impossible in a free and competitive market economy. A large involvement
of government makes big and persistent mistakes possible. Whereas China suffered
from the repressive and radical variety of socialism, India tried the democratic
variety. Both countries, even democratic India, more or less disengaged from the
global economy. In the late 1940s when India became independent, its share in
global exports was 2.4 per cent. In the early 1990s, it was only 0.4 per cent (Bhagwati,
1993: 58). "
"The poor performance of the world’s most populous countries was not inevitable.
In principle, both of them should have enjoyed the ‘advantages of backwardness’ and
should have benefited from ‘conditional convergence’ (Barro and Sala-i-Martin, 1995;
Helpman, 2004; Levine and Renelt, 1992; Levine and Zervos, 1993; Olson, 1996).
Although not all backward economies do converge, although not all of them exploit
the potential ‘advantages of backwardness’, in principle the followers of the global
development process enjoy some advantages over the pioneers. If they choose to do
so, they can benefit from the greater degree of economic freedom and development of
the more advanced countries (Weede, 2006). They may borrow technologies.9 They
easily find opportunities for productive investment and are less likely to run into the
problem of decreasing returns. They can reallocate labour from less productive
employment in agriculture to more productive employment in industry and, later, in
services."
Saturday, August 22, 2009
China: Will economic progress paving the way for political reforms?
If one is to go by the experience of the Asian tigers, then economic progress did create the demand for political reforms as well. China so has bucked that trend. But this item in the New York Times, may be an early indication that the forces of economic growth may be paving the road for political reforms to follow.
Internet censorship: "Since late May, Beijing’s Industry and Information Technology Ministry had more or less insisted that so-called anti-pornography software, called Green Dam-Youth Escort, would eventually be packaged with every newly purchased computer. On Thursday, the ministry backed down, calling the requirement a “misunderstanding” spawned by badly written rules. Officials offered no other explanation, but the retreat followed weeks of protests by outsiders — from foreign computer makers to foreign governments to foreign corporate branch offices — that said the software stifled free speech, compromised corporate security and threatened computers’ stability."
Intellectual Property: "the World Trade Organization told Beijing that it could no longer force providers of American books, music and films to distribute their goods through a local partner. Foreign companies saw that rule as an impediment to reaching a broad Chinese audience with their products. The Chinese market is flooded with pirated CDs and DVDs whose contents’ creators receive no money."
"The Chinese government dropped explosive espionage charges against executives of a foreign mining giant, the Anglo-Australian Rio Tinto, after a global corporate outcry... ... ... While the espionage allegations were not spelled out, they were apparently related to delicate commercial negotiations over the price of China’s imports of iron ore for its steel mills. Rio Tinto executives have strongly denied the accusations, and both the United States and Australia said China’s actions could have both business and diplomatic repercussions."
Please read the original item in the New York Times here.
Internet censorship: "Since late May, Beijing’s Industry and Information Technology Ministry had more or less insisted that so-called anti-pornography software, called Green Dam-Youth Escort, would eventually be packaged with every newly purchased computer. On Thursday, the ministry backed down, calling the requirement a “misunderstanding” spawned by badly written rules. Officials offered no other explanation, but the retreat followed weeks of protests by outsiders — from foreign computer makers to foreign governments to foreign corporate branch offices — that said the software stifled free speech, compromised corporate security and threatened computers’ stability."
Intellectual Property: "the World Trade Organization told Beijing that it could no longer force providers of American books, music and films to distribute their goods through a local partner. Foreign companies saw that rule as an impediment to reaching a broad Chinese audience with their products. The Chinese market is flooded with pirated CDs and DVDs whose contents’ creators receive no money."
"The Chinese government dropped explosive espionage charges against executives of a foreign mining giant, the Anglo-Australian Rio Tinto, after a global corporate outcry... ... ... While the espionage allegations were not spelled out, they were apparently related to delicate commercial negotiations over the price of China’s imports of iron ore for its steel mills. Rio Tinto executives have strongly denied the accusations, and both the United States and Australia said China’s actions could have both business and diplomatic repercussions."
Please read the original item in the New York Times here.
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