Prof. Arindam Chaudhuri
Hony. Dean, Centre For Economic Research and Advanced Studies, IIPM
Every time an Asian country starts making its presence felt in the global markets, there is a tendency to call it a miracle. First it was the Japanese miracle, then the Korean miracle and now it’s the Chinese miracle. Terming it a miracle is an escapist route to remaining ignorant. How can it be a miracle that first IBM’s PC business and now MG Rover have both been taken over by Chinese companies? And in the case of Unocal and Maytag, the US government had to interfere personally to stop the deals from taking place! They might have been successful for the time being, but how long can they delay the inevitable? It’s the rule of the jungle, as well as the free market, that the mightier always swallows the weaker. It’s the rule that the Americans themselves set for the rest of the world.
And the Chinese have understood this rule best. They first went about flooding the globe with their low cost products and went on to make the most enviable $160 billion trade surplus with the US, and now is the time for them to invest these dollars in buying up whatever remains made-in-America. This was always coming. For more than seven years now, one could not find any low quality Chinese product in the streets of Europe and America. From Georgio Armani to GAP, from Tommy Hilfiger to Versace, all products had the made-in-China stamp. In Disneyland, it seemed that more than 90% of the thousands of products sold from the 200 hundred odd shops were made-in-China. Everyone’s life was being touched by China. During Christmas, all gifts being exchanged were made-in-China (it was a similar case in India during Diwali). When 9/11 happened, Americans became hyper-patriotic and we could see American flags all over; most of these flags were made-in-China.
Not just that they went global, the global MNC giants preferred to invest in the dictatorial Chinese markets over the democratic Indian markets. The logic was simple: The Chinese government, before their quest for being the global survival of the fittest, had taken care of their local national needs for survival of the weakest. By being committed to their own people first and giving them purchasing power and removing millions out of poverty (the figure, put at 200 million, made the World Bank itself admit that in recorded history, no other country had brought more people out of poverty in a span of only 20 years), the China had made its markets attractive for investors.
Nothing works like commitment to the poor when it comes to everything from GDP growth to FDI to going global. Miracle is in commitment to the bottom 80% of the population. If the paralysed parliament and its worse off parliamentarians would only understand this and start working, it would be India in the global acquisition spree next. The old seem over the hill, but are the young ones listening? Or do they want to be a part of the same status quo and let the country grow despite the parliament?
