David Oks asks- 'Why China got rich and India didn't- The human roots of the Sino-Indian divergence'.
Between 1967 to 1976, thanks to China's Cultural Revolution, enrolment of college students dropped from 674,400 to 47,800. A civilization where erudition had been prized, turned into one where the only thing which mattered was getting enough to eat. Mao traumatized China. It responded by valuing what is material and can be sold for cash. India's leaders might scold Indians from time to time. But Indian leaders always pretended that true merit was spiritual or epistemological. It wasn't a matter of having lots of cash in the bank.
Here is a question that I think about a lot.
In the year 1950, much as today, the two largest countries in the world by population were China and India.
India had been partitioned on the basis of religion. Taiwan had split from Communist China. Clearly, religion was important in India but not China where ideology mattered much more.
China was a good deal larger at the time, holding 22 percent of the world’s population to India’s 15 percent; but really the two were in a very similar position.
No. They were in a completely different position. India was going to go forward in the Left of Centre manner of the English Fabian Society. China was going to try to emulate Stalin's 5 year Plans. This meant taking back the land given to the peasants and precipitating a big famine.
Both of them were giant countries that had assumed their current state—India as the independent Republic of India, China as the People’s Republic of China—in the preceding three years.
India had been conquered by Muslim Turks and then European Christians. China had been ruled by foreign origin dynasties but it tended to assimilate them & expand into their territory. It got rid of its Manchu Emperor & became a Republic (though a General declared himself Emperor briefly) in 1912. It is sad that Mao, on taking power, decided to do what Stalin did rather than allow his people to rise up through their own hard work and enterprise. Still, a lot of 'intellectuals' at that time believed that Communism had some special magic of its own. But Stalinist methods failed in China just as they did in Pol Pot's Cambodia. Indian Communists did do some mild land-reform in West Bengal and Kerala and that was perfectly fine. The problem was that when the Commies wanted to take that land back in Bengal, they were given the order of the boot.
Both of them were among the very poorest places on earth.
Both had plenty of very rich people in places.
And both of them were about to spend decades trying, by very different means, to make themselves rich.
Not really. The Indians weren't interested in getting rich. They kept gassing on about Gandhi and Ahimsa and the need to redistribute resources equitably. The Chinese Communists too were puritanical. It wasn't till the Eighties that Chairman Deng said 'to get rich is glorious'. By then it was clear that Taiwan and South Korea & Hong Kong & Singapore had chosen the better path.
In India, a foreign exchange crisis caused trade liberalization in the early Nineties. Some Indian people did get rich though they often found that it was easier to set up a factory in Bangladesh or mainland China. However, for IT services, India did have a competitive advantage.
For China, that experience was one long nightmare.
Because Mao was kray kray. Still, he showed the Japs who was boss by killing four times as many Chinese people as they had managed to do.
China had already been wrecked by a prolonged civil war
Because Chiang was shite & Mao was kray kray. The truth is, India had nicer leaders because War Lordism wasn't a problem. The Brits preserved a professional Army which they handed over to their successors.
Maybe if the Americans had backed Sun Yat Sen, a democratic China would have emerged as a counterweight to Japan. Sun probably saw the UK as a threat & Germany as a possible ally- which, naturally, the Anglo-Saxons would not like. After 1923 he allied with the Soviets- thus putting himself beyond the pale.
and by a brutal Japanese invasion in the decades prior,
which the Chinese should have crushed with insulting ease if they hadn't been busy fighting each other and doing stupid shit.
the whole experience killing tens of millions of people. The civil war ended in 1949, with a Communist victory; but what came next was no less catastrophic.
Coz Mao was kray kray. You may say, 'Mao deliberately crippled China so that it didn't have another bout of Civil War. After all, there are cheaper ways to kill people than to get soldiers involved.'
The Communists’ leader, Mao Zedong, immediately embarked on campaigns of vengeance against enemies of all stripes, murdering well over a million people in the process; he then launched on an ill-fated agricultural modernization campaign, the Great Leap Forward, that produced the largest famine in history, killing somewhere between 30 and 45 million people; and then a frenzied period of ideological radicalization, the Cultural Revolution, that suspended national life for a decade and killed another 1.6 million. By the time that Mao died in 1976, China was internationally isolated, economically stagnant, and still desperately poor.
But it had missiles and H-bombs and had broken the back of peasantry- i.e. there was no danger that an uprising in the countryside would cause regime change. Once Deng took power, China could start to do sensible things. A traumatized people simply wanted money & security. They didn't want to hear any more nonsense about ideology.
China kept the hukou internal passport system and only got rid of taxes and labour obligations for the rural peasants in 2006. Being a democracy, India favoured the rural masses with the result that its cities became unliveable.
For India, the experience was a much gentler one. India had been a colony of the British, and it was able to achieve independence without taking up arms. British institutions like the Indian Civil Service—the colonial bureaucracy, rechristened as the Indian Administrative Service—carried over into the new Indian state. There was a bout of extreme violence in the late 1940s, as the country was partitioned into Hindu-majority India
Hindus like elections. That is why the country remains democratic. Buddhist Sri Lanka is like India. Sadly, Myanmar is not. Nepal, which is Hindu majority, seems to have embraced Democracy though it did previously have a Communist PM.
and Muslim-majority Pakistan: but even that was incomparable to what China experienced. And after that episode, India enjoyed long decades of peace, stability, and democratic rule. It was led by a broad-minded secularist named Jawaharlal Nehru, who had been educated at the finest British institutions and governed in the name of science, reason, and social progress; and throughout its entire post-independence period India maintained open elections, an independent judiciary, and a free press. It never experienced anything like the Great Leap Forward or the Cultural Revolution.
India pursued bad economic policies while becoming reliant on Economic aid- including PL480 food-grain from the US. It would be fair to say that the material standard of living was falling for the middle class. Thus, in 1974, a boy might say 'Grandfather had a car. Daddy had to wait ten years to get a scooter. I will only be able to afford a push-bike- unless I emigrate.'
I suspect that if I’d been around in the year 1950, it would have been obvious to me that India would succeed and China would not.
Both succeeded. What was not obvious was that Nehru's daughter would take over from him. Mao's widow wasn't able to take power after his death.
I would have made the same bet in 1960, when China was starving tens of millions of its own people while exporting grain abroad;
Stalin showed that breaking the back of the peasantry, by starving them to death. is essential to secure control of a vast country.
and I would have done it again in 1970, during the insanity of the Cultural Revolution.
The South Koreans had a similar 'New Village' movement.
Nor would I have been alone. As late as 1985, prominent economists were writing articles in the New York Times suggesting that “far more than China today, India is an economic miracle waiting to happen.
This was Jagdish Bhagwati. Rajiv Gandhi had a huge majority in Parliament. He could have pushed through reform in land acquisition & labour regulation while making a bonfire of the import 'licence permit Raj'. Rajiv, erred on the side of caution. The system created by his grandfather had put a lot of power into his hands. Thus, if an old pal from Doon School needed his help to fight off a hostile takeover, the PMO could easily ensure this outcome.
But they were wrong.
Manmohan Singh was able to reform trade policy and India did indeed begin to grow more rapidly. The problem was infrastructure. The World Bank had helped China get state of the art infrastructure but, in India, the 'activists' were able to prevent development. This meant that indigenous billionaires took over such projects since they don't care what the activists say about them.
In the five decades since the death of Mao Zedong, China has grown much faster than its fellow Asian giant.
But Taiwan has grown faster than either.
China has become a manufacturing superpower and the single fastest-growing economy of the last 50 years; its per capita GDP, on par with India’s in 1976, is now about 2.5 times higher.
Deservedly so. It is estimated that Chinese manufacturing wages are three times higher but productivity is five times higher. This has to do with infrastructure & the manner in which local party officials encouraged the emergence of Marshallian industrial districts such that all inputs are available in a 50 km radius. India's total factor productivity is low because of some systemic dysdfunction.
And so Chinese people have become much better-off than their Indian counterparts. In 1987, median purchasing-power adjusted income in China was $1.88 per day, compared to $2.94 per day in India.
An overstatement for India.
Chinese median wages surpassed Indian ones in the early 2000s; and by 2022, China recorded a median income of $13.36, against $5.54 in India. In the 35 years between 1987 and 2022, Chinese median income rose 611 percent, while Indian median income rose only 88 percent.
China had the one child policy from 1979 to 2015.
So what happened? Why did China get rich, and India didn’t? What explains the Sino-Indian divergence?
Democracy. Indian politicians buy votes in the name of redistribution & reparation for historic injustices. Chinese politicians make people more productive so as to have more money to spend.
Last year, I visited India and got the chance to pose these questions to a few prominent Indians, including several members of the Indian parliament. The most common answer that I heard from them was simply that India reformed later.
The IMF forced devaluation on India in 1966. Perhaps, in Indira had not been PM, the country would have focussed on the foreign exchange constraint and ultimately gone down the road MITI had taken the Japanese. Indira, however, saw an opportunity to ditch the 'old guard' & lurch to the Left. Other South Asian countries did the same thing. Thus they fell behind the 'Tigers'.
Both India and China operated under strict state control of the economy for much of the post-1950 period; but while China began liberalizing its economy in 1978, India waited until 1991. And so China simply has a 13-year head start: no wonder it’s grown more than India has.
China had first become a military super-power & 'National Security State' (i.e. plenty of concentration camps). Its leaders showed enough pragmatism to work with the World Bank to get state of the art infrastructure (indeed, China became the best at this within a decade or two) even from the old enemy- Japan.
But that doesn’t explain why China has continued to grow faster than India.
India did not reform its labour & land acquisition laws. About half the population work on the land. In China the figure is 22 percent. In India, about 75 percent of farmers are net food consumers. Still, they have votes and thus must be accommodated in some way.
Between 2000 and 2022, long after both economies had liberalized—and with China already being considerably wealthier—Chinese growth still significantly outpaced Indian growth. So even decades after liberalization, India still underperformed China. The timing of liberalization can’t explain the divergence.
The fact that there was no liberalisation in labour & land law explains the divergence. Small units ignore the rules but then they don't get economies of scope and scale.
The same is true of policy more broadly. There are all sorts of ways in which Indian economic policy remains inefficient and distortionary in ways that inhibit growth; but the same is true for China and indeed for practically all countries. I don’t think that policy differences explain why India has so reliably underperformed China even at much lower levels of income.
Just say 'South Asia has a different culture and history from North Asia. India is like Pakistan or Bangladesh. China was once more like North Korea but is now more like South Korea. But, as a military super-power, it is going to make different decisions.
The same is true, I should add, of explanations that cite “Chinese culture” and “Indian culture.” It’s obvious that China and India have different cultures, and that those cultures lead people to behave in different ways.
Indians preferred to be ruled by nice White people from a distant island. The Chinese were happy to absorb knowledge of a useful type but there was no question of accepting foreign rule.
But that doesn’t explain why China started to outgrow India when it did.
Chinese power declined over the course of the Seventies as its conflict with Vietnam showed. China could rise with the help of the West. India, however, was firmly in the Soviet camp and thus could put off needful reform.
In the early twentieth century, long before Mao or Indian independence, India was richer than China,
Indians were complacent. Then, when Singapore fell to the Japanese, the Indians realised they had been living in a fool's paradise. The Indian military wasn't modernist. It was based on feudal notions with a veneer of Sandhurst aristocratic British values. The Chinese military had no choice but to embrace the most modern methods of fighting wars.
and Indian and Chinese cotton mill workers displayed broadly similar levels of productivity. Whatever cultural advantage that China might enjoy over India, it wasn’t operative a hundred years ago.
Sadly, India had a maha-crackpot called Gandhi who enabled Indian industry to enjoy 'the best of all monopoly profits- viz. a quiet life'- while leaving the vast majority of the population trapped in Malthusian involuted agriculture. Ludicrously, Gandhi thought spinning cotton could generate wealth! To this day, to join the Congress Party you have to vow that you are a 'habitual' spinner of yarn!
So I want to propose my own explanation for why China got rich and India didn’t.
Chinese people like eating nice things and having plenty of money. Indians pretend that they are far too spiritual to care about such things.
The moment of divergence, I think, came not in 1978, or in 1991, but around 1950.
Actually, China could have had balanced ten percent agricultural and ten percent industrial growth by following sensible policies. Indeed, when Nehru met Mao, this appeared to be the case. China was actually pumping money into Tibet and smart Tibetans were using the money to study in English medium schools in North India.
Rapid industrial development requires human capital: workers who are literate enough to be trained, healthy enough to show up, disciplined enough to come in on time, and sufficiently unencumbered by traditional life that they can sell their labor to whoever offers the most for it.
Nope. All you need is plenty of rural girls whom you lock up in giant factory dormitories. They work hard from the age of 14 to 24 and get a bit of education in the process. They they get married and have a baby or two. But they return to work as and when there is an export boom. Boys can be conscripted or made to work construction. Let them get married in their mid to late twenties.
Traditional agrarian societies produce almost none of these people: the peasants who made up the bulk of both India and China in 1950 tended to be illiterate, sickly, and restricted in all sorts of ways.
The more prosperous 'kulak' (owner- cultivator) was strong, healthy, and keen on technical education. The Brits found that Indian peasant castes produced excellent soldiers. But the Chinese peasant, too, was highly productive even when transplanted to distant countries. His children rose rapidly through education. Edwin Lim, the World Bank Economist who helped China to rise, told his opposite numbers that his father was a poor peasant who stowed-away on a ship to the Philippines where he rose up through hard work and enterprise. Interestingly, Lim worked closely with Zhu Rongji who was descended from the first Ming Emperor. His family mansion was destroyed during the Cultural Revolution.
For people to be productive workers in modern economies, all of that must be cut away. The more advanced European states spent much of the last millennium doing exactly that. And between 1950 and 1980, China succeeded—frequently through brutal means—in replicating that process: over the course of a few decades, the Chinese state modernized its society at the barrel of a gun.
China had too many people to go in for conscription. The key was getting rural girls into factory dormitories. Mao had offered Kissinger as many such girls as he could take away.
Poverty is created by poor women having babies. If they work in a factory, they just have one or two babies and they make sure those babies get a good education.
By 1980, as its economy opened to the world, China was a socially modern country that just happened to be extraordinarily poor.
Lim says China didn't look poor. It was just that you couldn't see any great wealth (unlike in India).
It had the human capital for rapid industrialization.
It had the World Bank enabling it to cheaply acquire state of the art infrastructure- even if it was supplied by Japan. The South Koreans and Taiwanese invested heavily in China but it was the 'can do' attitude of local party cadres which made all the difference.
Gurcharan Das tells the story of an Indian industrialist who had gone to Hong Kong to buy his daughter's trousseau. A Sindhi friend invited him to visit the factory he had set up on the other side of the border. The Indian was disgusted that Chinese cadres had turned up at the airport itself to harass them! He said in Sindhi 'These dogs are so greedy, they come to demand bribes even before you have set up your factory! Indians may be avaricious but at least they have common courtesy!' The Sindhi, who spoke Cantonese, said 'these officials aren't here to demand bribes. They are here to give written promises that electricity hook-up, water connection, etc. will be done by such and such date. They do everything to make sure our unit is profitable because then they get the tax revenue. They don't want to kill the goose that lays the golden egg.'
But India never underwent that transformation.
Parts did. Sadly, the places where poverty is greatest are also the places where setting up a business is a nightmare.
Its traditional social order survived independence more or less intact; and the Indian state never managed to develop its people’s human capital as China had.
Some states did. Others didn't. India is less homogenous than Han China.
When India finally opened its economy to the world in 1991, its people were simply not prepared for industrial modernity in the way that China’s were.
Nonsense! India had had 'industrial modernity' before Independence. Some big companies- Tata, Birla, Bajaj etc.- presided over such enclaves but, often, they would have to move abroad to expand. Interestingly, some left wing British Social Anthropologists have given a granular account of how the 'modern sector' in Indian manufacturing is forced to retain blue-collar workers who do no work while employing more and more clerks to meet the ever mounting compliance burden.
China invested in its people; India did not.
China shot a lot of its people. India did not. Interestingly, the first World Bank loan, in 1980, was for Education. The Chinese system was shambolic. There was a 'lost generation'- including people like Xi- and there was a danger that this would create a bottleneck. One reason this did not happen was because rural communes, after the big famine, were looking for pragmatic ways forward- i.e. there was hidden innovation at the local level even when the 'Gang of 4' appeared hegemonic.
So how did China do it?
By killing or 're-educating' people. It must be said, the Chinese always wanted first rate education while the Indians preferred 'degree mills' with plenty of 'affirmative action'.
And why wasn’t India able to do the same?
It is a Democracy. Why kill when you can buy votes using money squeezed out of the productive sector?
The Communist road to capitalism
Is called State Capitalism. It must be said, China had some great indigenous technologists who enabled it to survive the shock of Soviet withdrawal.
In 1949, after decades of war—either against the invading Japanese or against their Nationalist foes—the Communist Party of China triumphed over all its enemies and achieved complete power over mainland China.
Marshall decided the KMT was too corrupt to be worth propping up. Mao won because the kulaks gave him food & the Soviets turned over Jap military equipment.
The remaining Nationalist forces fled to Taiwan; and Mao Zedong, paramount leader of the Communist Party, announced the formation of the new People’s Republic of China.
Mao had three overriding objectives for the governance of China. The first was the absolute consolidation of Communist power over the country; the second was the reconstruction of social life along Communist lines; and the third was the economic transformation of China, from an impoverished and agrarian society into a wealthy and industrial one.
A lot of the spade-work had been done. Foot-binding had been outlawed in 1912 though this wasn't always enforced. It was believed that the Cultural Revolution had released a lot of agricultural land, previously used for ancestral tombs, but, it appears, such customs still persist.
On the last goal—making China prosperous and powerful—Mao failed entirely.
It was more powerful in 1962 than in 1967. However, its war with Vietnam, in 1979, was an eye-opener. Clearly, the sleeping giant needed to wake up.
China remained bitterly poor throughout his time in power, and all his interventions in economic policymaking proved to be disastrous. But on the first two goals, eliminating opposition to Communist rule and reshaping Chinese society according to his whims, Mao was remarkably successful: between 1949 and 1976, the Communist Party totally transformed Chinese life.
Before another such total transformation.
It’s hard for us today to grasp just how brutal that transformation was.
Unless we know what Stalin had gotten up to.
From 1950 onward, every force in Chinese life that might contest the hegemony of the Communist Party was ruthlessly suppressed and destroyed. The landlords and “rich peasants” who had comprised the traditional leadership class of the villages, for example, saw their lands expropriated by the Chinese state in the 1950s; they were forced to sit through public sessions in which the peasants would “speak bitterness” to them, typically culminating in their being beaten to death. Several hundreds of thousands of people were killed in this way. During the same time period, another several hundreds of thousands were killed as “counterrevolutionaries” opposed to Communist power.
Mao, like Stalin, was worried about a Pugachev- i.e. a peasant uprising. Famine breaks the morale of the peasant. I think, in China, it had the salutary effect of making rural communes more pragmatic & keen to rise by any licit or illicit means. There's nothing like the memory of a big famine to keep you focussed on survival.
But it wasn’t just landlords, rich peasants, and “counterrevolutionaries.” Practically every representative of traditional power in Chinese life was crushed. The hundreds of secret societies and sects that had dotted Chinese life, counting about 13 million members in 1949, were destroyed in the “Withdraw from the Sects” campaign; Confucianism and other pillars of the old order were attacked and suppressed; the hundreds of thousands of small shrines that had structured Chinese folk religion were declared “superstitious” and obliterated; major faiths were brought under state supervision, and at the peak of Communist enthusiasm in the 1960s religion was banned entirely and countless ancient temples destroyed. The famous Jing’an Temple in Shanghai, built in the third century, was turned into a plastics factory.
It was rebuilt in 1983.
Even family patriarchs lost much of their authority. Decisions that had once been vested in families and elders—about, say, marriage or the allocation of land—were stripped and transferred either to individuals (in the case of marriage) or the state (in the case of land). In 1950, the Chinese government passed the New Marriage Law, which banned arranged marriage, concubinage, and child betrothal, gave women the right to own property and divorce freely, and allowed women to keep their own names upon marriage. This was a radical departure from the patriarchal order that had governed Chinese marriage for all known history: and while it led to a tremendous amount of conflict, the Chinese state simply crushed opposition—branding elders as “landlords” and encouraging women to “speak bitterness” about their in-laws and grandparents. The mass mobilization of women into the workforce, under the slogan that “women hold up half the sky,” was similarly transformative: tens of millions of women were pulled out of domestic seclusion and into economic life, and thus freed from the control of their families. And so the traditional Chinese kinship unit—not merely a “family” but an autonomous institution governing the lives of its members—was destroyed.
Mao's greatness lay in his using the students to beat his opponents and then using the factory workers to beat the students and chase them into the countryside. Closing the medical schools for a decade doesn't seem to have hurt health outcomes. I suppose the same could be said for traditional family and clan structures.
All this meant that between 1949 and 1976, the Chinese state effectively destroyed traditional Chinese society: the social landscape of the old China, with all its complexity and custom, was simplified and smoothed away.
There was the precedent of the First Emperor burning the books & condemning scholars to 'oil basket graves'.
And in its place, the Chinese state forged a new nation along its preferred ideological lines. Economic development always eluded Mao; but human development—mass education and mass health—proved more attainable.
I suppose Famine is a Darwinian 'shock' which kills off the less fit.
Literacy campaigns and mass education helped raise the literacy rate from roughly 20 percent in 1949 to almost 70 percent by 1982.
Sadly, this did not mean they could read a newspaper.
These gains were concentrated among women: Chinese women went from “virtual complete illiteracy” to a literacy rate of about 50 percent during the same period. The progress in health was similarly rapid: child mortality fell by 80 percent between the early 1950s and the late 1970s. Even with all the horrors of Maoist rule—including, it should be remembered, the largest famine in history—between 1949 and 1976 China recorded one of the largest sustained increases in life expectancy of any country in history, rising from about 41 years in 1949 to 61 by 1976.
Since there was no census between 1964 & 1982, the figures were made up.
And for the first time in history, Chinese women were meaningfully included in public life:
there had been Chinese Empresses
by the late 1970s, China had a female labor force participation rate exceeding that of many rich countries.
In much of rural Africa, it was 100 percent. Why? If you didn't work, you didn't eat.
And so by the time that Mao died in 1976, Chinese society had been utterly transformed.
It was worse off than it had been before the split with the Soviet Union.
It was still a deeply poor and largely agrarian country; but it had education and health outcomes far exceeding what you’d expect from a country at its level of income.
It had shut down its medical schools. That's what you would expect of a shithole.
And it had crushed the traditional social structures that had previously governed every aspect of Chinese life.
With the result that life had turned to shit.
It was a socially modern country
like the US where Nixon could have you shot if you called him a crook
that just happened to be extremely poor: in 1980, China had the same life expectancy as Mexico despite having a per capita GDP 80 percent lower than Mexico’s.
We don't know China's life expectancy in that year. We do know that Chinese people were prepared to emigrate to Mexico or Pakistan to have a better life.
And this meant that by the late 1970s, even before the “reform and opening up” process started, China was perfectly prepared for industrial capitalism.
That's not what Edwin Lim says. Progress was slow because few Chinese officials understood neo-classical economics. Still, they did understand that they needed to imitate what the 'Tigers' were doing.
The old constraints—kinship, tenancy, female seclusion—had been swept away; the Chinese workforce was mobile, trainable, and cheap. That mismatch, between China’s level of human development and its level of wealth, was bound to be resolved by rapid economic growth.
Communist China could have done what Taiwan or South Korea did- or going further back in time- what Japan had done. Indeed, China could have modernized after the first Opium War and thus gained superpower status by 1900.
When analysts from the World Bank visited China in the early 1980s, they reported that its low-income groups were “far better off in terms of basic needs than their counterparts in most other poor countries”;
i.e. they weren't dead. Chinese people weren't being kept alive by American food aid.
if China’s “immense wealth of human talent, effort and discipline can be combined with policies that increase the efficiency of resource use,” their report said, “China will be able, within a generation or so, to achieve a substantial increase in the living standards of its people.” And that’s exactly what happened.
It had already happened in South Korea & Taiwan etc.
India’s failed social modernization
On the surface, India’s trajectory was a much happier one. India didn’t need to fight a war of independence to gain independence: power passed from British hands to Indian ones more or less by negotiation. The partition of India was horrific, killing between half a million and two million people;
but most Hindu Indians were wholly unaffected.
but it still paled in comparison to the scale of the Chinese Civil War, the Sino-Japanese War, or the Great Leap Forward. And in the decades after independence, India enjoyed stability and democratic governance. It never saw the barbarities that China experienced under Mao.
But India also never underwent the social transformation that China did.
Sure it did. It's just that very little violence was involved. People chose what path to follow and, sometimes, there was legislation to help things along.
The great power in India in the decades after independence was the Indian National Congress,
set up by British Civil Servants & Indian barristers in the 1880s
which had been the central vehicle for winning independence.
The Brits wanted India to be self-administering and self-garrisoning.
Between 1947 and 1989, Congress found itself out of power for only three years; its hold on power wasn’t absolute, but it was certainly dominant. But Congress wasn’t really an ideological movement.
It was Dynastic.
It had started in the late nineteenth century as a forum for educated Indians seeking moderate reform, and then transformed into a mass movement for independence. It was a big-tent party whose membership amounted to the entire cross-section of Indian life: left-leaning secularists, Hindu traditionalists, upper-caste chauvinists, lower-caste activists, landlords, socialists, and many members who were simply non-ideological and attracted to the charisma of the party’s leaders or the power that membership offered.
And so even though Congress dominated Indian politics for decades, it never offered a coherent program for remaking Indian society.
Nonsense! It was against untouchability and for equal rights for women and so forth. After 1955 it was committed to Socialism but soured on the project because of accumulating losses in the Public Sector.
If the Chinese Communists sought out endless antagonisms, Congress avoided them; if the Communists imposed radical change from above, crushing all who stood in their way, Congress was happy to defer to existing interests and hope for social cohesion and gradual progress.
There was always something vaguely spiritual about Congress. It would be fair to say that Nehru talked like a Fabian Socialist but, at heart, had a Gandhian belief in the futility of merely material aspirations.
This doesn’t mean that the leaders of the Congress Party didn’t have their own ambitions for transforming India:
They liked talking. Transforming? Not so much.
Nehru, who served as prime minister from independence until his death in 1964, had a strong dislike for the “superstition and deadening custom and tradition” of traditional Indian life, and wanted to solve the “insanitation and illiteracy” and “hunger and poverty” that marked the country.
by talking incessantly. Then the Chinese took down his pants and made fun of his puny genitals. He realised he had been living in a make-believe world.
But Congress wasn’t united behind him: Nehru simply didn’t have the power to achieve this in a real way.
Nehru didn't want to achieve anything in particular. He just liked talking.
In 1950, for example, Nehru and his law minister—the famed lower-caste activist B. R. Ambedkar—introduced the Hindu Code Bill, a sweeping reform of Hindu personal law. (Under the Indian constitution, different religious communities were governed by different systems of personal law.) The bill would have outlawed polygamy, granted women the right to divorce and inherit property, and permitted inter-caste marriage.
It would have been ignored. Nehru was being silly. Indian law was customary in nature. It didn't matter what a Statute said. It was sufficient for a practice to be customary for it to be legal.
It was similar in structure to the New Marriage Law that the Chinese government passed the same year, though it stopped short of banning arranged marriages like the New Marriage Law had. But the Chinese government had imposed the New Marriage Law by fiat and steamrolled those who stood in its way. Nehru and Ambedkar, by contrast, found themselves frustrated by a wave of opposition from Hindu traditionalists: even India’s president attacked the bill, suggesting that introducing concepts “foreign to Hindu law” would “cause disruption in every family.”
The question was who would win the first General Election under universal franchise. What if traditional Hindu outfits won big?
And so the Hindu Code Bill died in parliament. Ambedkar resigned in disgust; and while Nehru ultimately succeeded in reforming Hindu law, he was forced to agree to enormous concessions.
Everyone knew the law didn't matter in the slightest. You could always claim to be Muslim and marry as many girls as you liked.
The law that regulated Hindu inheritance, for example, exempted agricultural land from its purview entirely, and so didn’t touch the vast majority of useful property;
The rule that regulates inheritance of farmland has to do with being repeatedly stabbed.
the law that regulated marriage included a right to divorce, but also a provision for the “restitution of conjugal rights” that gave husbands a court-enforceable right to compel their wives to return home.
Fuck off! That's a money claim. If your wife has some cash, she has to pay you some money in order to get a divorce.
But it didn’t really matter what the laws said: enforcement was weak to nonexistent. Divorce and intercaste marriage, whatever their legal status, remained vanishingly rare, because the village and the family enforced the old rules regardless of what the law said; customs that compelled women to renounce their inheritance claims, like the Rajasthani custom of haq tyag (“sacrifice of right”) or the Haryanvi custom of karewa (forced remarriage of widows to control their land rights), remained common. Even the officials charged with enforcing the laws subverted them: the administrators who registered inheritance claims, for example, would routinely pressure daughters to sign away their rights in favor of their brothers.
Why bother? Stabbing people is the traditional way to assert property rights.
And that was the general pattern of attempts at social modernization in India in the twentieth century: highly publicized reforms, followed by little change on the ground.
Unless there was actual social transformation which is why both my widowed grandmothers inherited their husband's property and were able to make some good investments.
In 1961, the Indian government made dowries—payments made by a bride’s family to the groom’s family at marriage—illegal, since the practice entrenched the subordination of women and encouraged domestic abuse. But the law went entirely unenforced; dowries remained as popular as ever, and all the abuses linked to dowries still flourished. (Between 1999 and 2016, dowry-related murders accounted for 40 to 50 percent of all female homicides recorded in India.)
The daughter of Arun Nehru- a cousin of Rajiv Gandhi- alleged that her husband- the son of a billionaire shipping tycoon- was harassing her for dowry. Nobody believed her.
The same was true of attempts at land reform. Several Indian states attempted land reform in the 1940s, ‘50s, and ‘60s; but enforcement was lax.
Unless it wasn't. Oddly, the Commies in West Bengal were quite good at redistributing 'surplus' land.
Landlords managed to simply evade the rules through legal means, like transferring holdings to relatives, or registering land under fictitious names; or they simply bribed or intimidated government officials. And so very little really happened.
Unless it did. When a Society is transformed, things change even if no laws change.
All of this meant that the Indian state was never able to achieve the social modernization that the Chinese state accomplished.
A State founded on Terror is not 'modern'. It is very ancient indeed.
The dense web of kinship obligations and customary authority that governed social life remained intact.
Only in some places.
Caste panchayats still adjudicated disputes; joint families still pooled and redistributed income; and women remained bound by all the strictures of traditional life.
If that is what they chose to do.
Nor was the Indian state able to accomplish the dramatic improvements in human capital that occurred in China.
China closed its Medical Colleges for a decade. India didn't. That's why you will find lots of Indian Doctors in the US.
Just as it was unable to reform social life,
unless people wanted a reformed social life- which is what people of my caste have had for many decades.
it was unable to provide effective services; health outcomes remained dismal. Within a single generation, India’s health outcomes went from comparable to Chinese ones to dramatically worse.
The Chinese outcomes were pure fabrication.
The gap between Indian and Chinese life expectancy widened from three years in 1950 to 11 years in 1980.
But the census was only held in 1982! How the fuck did the Chinese know how many people were alive and what their ages were?
Child mortality told the same story. In 1950, 27 percent of Indian children died before the age of five, compared to 32 percent of Chinese children; by 1980 it was 17 percent in India, against 6.3 percent in China.
China had a census in 1964 but its accuracy is questionable. What is certain is that any figures prior to 1982 were fabricated.
And the same with education. Nehru and his successors were keenly interested in technology and the peaks of scientific achievement; but they could never muster similar enthusiasm for mass education.
That was a State subject. It was up to the local politicians to provide as much or as little of it as the voters wanted.
So India established a network of world-class technical institutions, like the Indian Institutes of Technology and the Indian Institutes of Management, while neglecting everything else: even today, India’s elite technical universities receive the majority of government funding for higher education, while educating only 2.6 percent of the university population.
Nonsense! The States spend the lion's share of the education budget on primary and secondary schools & Colleges of various sorts. Half of the Central budget for Higher Education goes to 'elite' institutions. But there are plenty of other fee-charging Universities.
Indian mass education, meanwhile, remained abysmal. In 1990, only 55 percent of Indian children had completed primary school three to five years after the expected completion age, against 87 percent of Chinese children; and even those who did go to school often got little out of it.
It is difficult to fire illiterate or absentee teachers. China can just shoot them.
In 2009, when India participated in PISA—the Programme for International Student Assessment, which ranks students across countries based on test scores in math, science, and reading—it ranked 72nd out of 73 countries. (China ranked at the top.) The Indian government responded to this embarrassing result by never participating in PISA again. This lack of investment in education is visible in Indian literacy rates, which only exceeded China’s 1990 level in the early 2020s.
It is irrelevant. What matters is the return to education relative to the return to knifing people. Where the latter is high, Student Leaders concentrate on knifing people.
This lack of progress was particularly brutal for Indian women.
Hindu women tend to do better than Chinese women when it comes to top jobs in the public or private sector.
There was no great liberation of Indian women as there had been of Chinese women: all the abuses of traditional life, from dowry murders to forced marriages, remained common.
Wholly unknown amongst the vast majority.
Literacy rates for women remained extremely low; in 1981, only 26 percent of Indian women knew how to read. And with women’s lives still determined by the whims of their families,
rather than the whims of a politician
the vast majority of women remained in the home: by the late 2010s, India recorded a female labor force participation rate of about 27 percent, one of the lowest rates in the world—closer to Afghanistan, at 18 percent, than to China, at 61 percent.
Oddly, a lot of people would prefer to remain at home rather than have to work in a factory. Because India is a Democracy, politicians figure out ways to pay poorer women a little money in return for their votes.
(India’s low rate of female labor force participation, in fact, means that India’s labor force remains significantly smaller than China’s, despite India having a larger population: in 2019, in fact, China’s labor force was 45 percent larger than India’s.)
All of this meant that by the time that India liberalized its economy in the early 1990s, it simply didn’t have the pool of high-quality, low-wage labor that China could command.
It did, but compliance costs were higher & infrastructure roll-out was tardy.
Thanks to its elite technical universities, India did have a relatively small number of highly-educated engineers, who became the backbone for India’s IT services economy; but it didn’t have the workforce for manufacturing-led growth.
Currently, a lot of small to medium sized outfits are operating at 50 percent capacity because of blue-collar worker shortage. They blame the gig economy.
Its workers were less literate, less healthy, and less productive than what China could offer; they were bound by caste and kinship obligations that made them reluctant to migrate for work or sell their labor freely;
Actually, such networks made migration easier.
and because so few women participated in the labor force, India had a higher dependency ratio than China, with each working Indian supporting far more people who weren’t working.
There is a leisure preference built in to the economies of very hot and humid countries.
India did grow after liberalization, of course; and by historical standards its growth was generally quite fast. But it never saw the manufacturing boom and explosive growth that China exhibited.
Because it initially relied on a capital-intensive strategy before running out of money. After that, it went in a populist direction. Families have a portfolio of investments- some agricultural land, one or two small industrial units, some retail & residential property. But what makes all this cohere is an opaque relationship with local government & the nationalized banks. That is why the Indian farmer's protests was about protecting the 'arhatiya' middle-man who provides a broad range of services.
It hadn’t accomplished the prerequisites.
There are no prerequisites. Take a bunch of hungry people and give them food if they work their asses off. Those who survive and reproduce are your industrial proletariat.
Human capital is what really matters
Sadly, human capital can run the fuck away from shitholes.
I think that people make economic development more complicated than it needs to be. It’s true, of course, that certain policies are better than other policies, and that all sorts of things go into successful economic management: disastrous decisions can ruin everything, though (as Mao’s many disastrous decisions might suggest) not permanently.
Unless they aren't reversed.
But when you come down to it, countries are large groups of people. And the most important thing for the success of those groups is simply who’s in them: this is as true for countries as it is for companies, music bands, and sports teams.
You can always bring in smart people from elsewhere.
Human capital is what really matters. Whether the people can read; whether they’re stunted due to undernourishment; whether their families let them work outside the home.
Is irrelevant. You just need one guy who can read a bit to supervise a whole bunch of guys who can't read at all.
Human capital isn’t the only thing that matters, and of course you also need institutions that can harness the country’s human capital. But you need the human capital to be there in the first place.
You just need human beings who will work for food. We are a self-domesticated species.
One of the nice things about countries, though, is that you can change who the people are. You can teach them to read and make sure they have enough to eat;
No you can't. I recall, trying to teach Argentina to read Sanskrit in 1968. It told me to fuck off. I cried and cried. To cheer me up, Mum let me provide Peru with plenty of chocolate cake to eat. I hope they were grateful.
you can make sure they have the freedom to make their own decisions.
Very true. I made sure the Irish leprechauns would have the freedom to make their own decisions. Sadly, they appointed Leo Varadkar Taoiseach.
This isn’t easy, and it takes a long time for it to have an effect—not least because childhood undernutrition and poor schooling have consequences that can’t really be reversed. But you really can change who the people are.
What made China a “miracle waiting to happen” in 1980 was that
other Chinese people living in less horribly misgoverned countries had already done very well
it had spent decades doing exactly that. By the time it opened its economy to the world, China had hundreds of millions of capable, disciplined, healthy, and literate workers; it had freed them from the constraints of traditional culture, such that market logic could triumph unimpeded by the old order; and because it had failed almost totally in economic development up to that point, it could offer those workers at unbelievably low wages. It’s not hard to see why it grew so rapidly once it opened its economy to the world.
What China offered was stability. You don't have to worry that some bunch of protesting students will bring down the Communist party.
The Indian government never made the catastrophic decisions that the Chinese government did in the 1950s and ‘60s. But it also never made the basic investments that the Chinese government made,
Sure it did. There were Medical Schools and a Public Health System and so forth. True, in some places, the locals kept raping the Doctors & Nurses and Teachers till they all ran away, but that was a matter of democratic social choice.
and it never managed to challenge the traditional social order with a fraction of the ferocity that China did.
The traditional social order in India was as weak as a kitten- which is how come it was ruled by British people.
And so in all sorts of metrics—life expectancy, child mortality, literacy, female labor force participation, childhood wasting, childhood stunting, anemic pregnancies, maternal mortality—an enormous gap opened up between China and India well before they liberalized their economies.
No. The Chinese didn't have any reliable statistics. India did. Why? India was in the begging bowl business. China was in the business of pretending its people were richer than Americans.
I think the true moment of divergence was not in 1978, when China began to reform its economic system, but in 1950—when China passed the New Marriage Law,
The KMT had passed something similar in 1930 or '31 but it was considered bourgeois. Mainland China only got a unified code in 2020.
while India failed to pass the Hindu Code Bill. It was then that the direction of future things was written.
The Hindu Code was passed four or five years later. It made no difference whatsoever. Society was already changing by a process of 'Tardean mimetics'. Girls were completing their education before marriage. By the 1950s, more and more of them returned to work after having a baby or two.
India, in other words, never really did the basics.
No. In India, the 'forward castes' were demographically replaced by 'backward castes'. But, now, they too are undergoing demographic transition.
Health and education outcomes in India have improved significantly over the last few decades; and while India hasn’t exhibited the world-historical growth of the Chinese juggernaut, it has still brought an extraordinary number of people out of poverty since the start of the 21st century. At current levels of growth, India will be about as wealthy as China on a per capita basis sometime in the 2040s. It’s impressive, in fact, that India has managed to grow so much without having accomplished the social transformation that China did. Given how brutal that social transformation was, perhaps that’s a good thing.
In India, we simply don't know which party will be in power a decade from now. The plain fact is, India has preserved much of its inheritance from the British- about whom Santayana said 'the world never had sweeter masters'. But the Brits were interested in providing only a night-watchman state. They weren't trying to impose crazy ideas of their own.
But it was also a tragedy for the people of India. They remain significantly poorer and worse-off than their Chinese counterparts.
Unless they work hard and become significantly richer. The difference between an Indian billionaire and a Chinese billionaire is that the former doesn't fear being 'disappeared'.
The situation for Indian women in particular remains horrific.
Unless they happen to be the President of the country.
So I hope that this history of the Sino-Indian divergence conveys a simple lesson: if you want your country to go from poor to rich, the most important thing is investing in your people.
By starving them, killing them and shutting down all the Medical schools for a decade.
When I was in India last year, one of the main things I noticed about Indian policymakers was their firm belief that with a few adjustments—industrial policy here, market liberalization there—India could start to match China’s growth record.
We could at least catch up with Vietnam.
And I don’t condemn them for thinking along those lines: good policies certainly do help a country grow. But China’s explosive growth wasn’t simply a matter of “freeing the markets,” reducing the role of the state, and announcing that it was now glorious to get rich; nor was it simply a matter of government intervention to support the manufacturing sector and subsidies for favored companies. China succeeded because it spent decades on the basics of human development and social modernization.
It really didn't. China destroyed the life-chances of an entire cohort in an act of unprecedented vandalism.
India did not. The rest is just commentary.
India did what its neighbours did for pretty much the same reasons. It is what Chairman Xi has done- e.g. get rid of absolute poverty while gaining a threat point against the US- which focuses minds.
When I was a kid, High School Econ textbooks had chapters on Industrial Policy & Manpower Policy & Regional Policy & Optimal Tariff theory. China's success relative to Trump's US has put stuff of that sort back on the curriculum.
What isn't true is that Mao was an 'engineer of human souls' who created a brand new type of Chinese person who, by her hard-work and thrift, could save Affluent Societies from Stagflation.
