(via YaleGlobal online) Every day, countless commentators prophesize the ascendance of the world’s next superpowers, China and India, the two “Asian giants” shaking off their ancient slumber and rising to the call of the 21st century. According to popular punditry, their place in the firmament of globalization’s success stories is already guaranteed. Yet economist Pranab Bardhan argues that a much more complicated picture belies the rosy visions of optimists. In China, rural and urban inequality grows at alarming rates, stirring unrest amongst those hundreds of millions who remain impoverished. In fact, China, responsible for only 6 percent of world trade, has actually lost manufacturing jobs in the past ten years. Meanwhile, India’s much-vaunted hi-tech sector accounts for less than one quarter of one percent of the country’s labor force. The nation still boasts the world’s highest illiteracy rate, while poverty reduction continues to slow. In short, Bardhan suggests, only patience and struggle – not destiny – can guide India and China to the level of superpowers.
Of the total of 2.3 billion people in these two countries, nearly 1.5 billion earn less than US$2 a day, according to World Bank calculations.
A Herculean Task What about the hordes of Indian software engineers, call-center operators, and back-room programmers supposedly hollowing out white-collar jobs in rich countries? The total number of workers in all possible forms of IT-related jobs in India comes to less than a million workers – one-quarter of one percent of the Indian labor force. For all its Nobel Prizes and brilliant scholars and professionals, India is the largest single-country contributor to the pool of illiterate people in the world. Lifting them out of poverty and dead-end menial jobs will remain a Herculean task for decades to come.
Commercial regulatory structures in both countries are still slow and heavy-handed. According to the World Bank, to start a business requires in India 71 days, in China 48 days (compared to 6 days in Singapore); enforcing debt contracts requires 425 days in India, 241 days in China (69 days in Singapore).