Economics versus politics

Economics versus politics

Apropos on of article in The Jakarta Post dated April 19,
Suns in the East will outshine the West, I would like to share
my views.

China and India are the world's most populous countries,
representing continuity of civilization and the ability to develop
in qualitative and quantitative terms the biggest pools of talent
in the world. At the present rate, India is set to fulfill Goldman
Sach's prediction "of a possible Indian economic eclipse of China
in the next half century".

China has advantages over India in:

1. Manufacturing ability and literacy1. Manufacturing

2. Disciplined workforce

3. More investor-friendly licensing policy

But India has an edge over China in:

1. Entrepreneurship and IT

2. Large English-speaking population

3. Democratic practices leading to innovativeness, research and
development

4. Future demography (China's one-child policy will exact
penalties in two to three decades when the ratio of working to
non-working population will tilt in favor of India)

5. A huge middle class -- unlike China, India is a big market in
itself

As for their being a paradigm shift in U.S. foreign policy,
the U.S. pays attention to India because American politicians
look to 200,000 Indian millionaires in the U.S. for funding their
elections (figure from Merrill-Lynch). One-hundred-and-twenty
Senators are members of the Indian Caucus on Capitol Hill and
Indians are on the donor list of all major charities.

India's foreign reserves have crossed US$79 billion -- this
may not encourage exports but will definitely boost foreign
investment at a time when Europe is suffering from sclerosis,
Japan is stuck in deflation and the U.S. is in recession.

China has already stolen the U.S.'s blue-collar jobs, India is
giving its white-collar professionals sleepless nights.

Economics definitely prevails over politics.

PAYAL BAJAJ, Jakarta