Having spent six years advising governments in Georgia, Kazakhstan, Uzbekistan and Turkmenistan to reform their oil sectors, I had good insight into the reasons for the failure of former Soviet Union (FSU). Since China is supposedly a communist country, I thought China may also suffer from the same problems. However, the reality is otherwise.
With very few exceptions, most attribute the phenomenal progress of China to its dictatorial rule that ignores human rights. India and China started the long development journey around early 1950s, more or less with similar low per capita incomes. China was able to control population growth by successfully enforcing the one child per family formula. India has been able to check population growth only slowly. China is going to age quickly, while India may fail to reap the demographic dividend because of its failure to improve education.
Shanghai vs Manhattan...
China has achieved unbelievable level of progress since the end of Mao’s era and the beginning of Deng Xiaoping’s reign in 1978 when he adapted market economy. For starters, on purchasing power parity, China is perhaps the largest economy. For another, the skyline of Shanghai, the miles of very efficient freeways with lane discipline, the inexpensive subway train in cities and high-speed train services between cities or the near absence of beggars, all clearly show that China has made monumental progress.
Without exception, toilets were in clean conditions while most were world class. Roads were without any potholes. It is difficult to find such roads even in the US. Shanghai is more imposing than Manhattan without the slums of Harlem and crowds of Times Square, but with efficient and cheap public transportation. The manicured lawns and gardens all along the roads with beautiful trees of different varieties were amazing.
Shanghai with a population of about 26 million is able to supply water 24 x 7. In India can we find even one city with 24 x 7 water supply? Our cities are drowned in garbage and we think that it is not possible to eliminate them. We take pleasure in felling trees and do not care about planting them. Less said the better about our roads and disappearing parks.
Press freedom in China is totally absent. We, therefore, think that there is little to learn from China. The underlying assumption is that if a country has a dictatorial regime, it is easy to achieve economic development. We believe that China’s development will collapse because of its own inherent weakness. We point to more than 20 per cent of vacant buildings and also massive sticky loans by the banks to predict the demise of this economic miracle. These may turn out to be just wishful thinking. Pray, how many countries with dictatorial regimes have recorded such development?
Focus on education, merit...
Though it is one party rule in China, most part of their bureaucracy is driven by merit. The real reason is the great importance given by Chinese to educate their children from elementary to high school to university levels. The literacy rate is very high in China. Their school system is able to impart quality education and China leads in Program for International Student Assessment. India does not even take part in these tests.
What is the significance of human rights to the poor in India who neither have proper housing nor food? In what ways more than 16,000 homeless in San Francisco derive benefit from human rights in the US? This is not to argue that human rights are not important. But that should not be an over-powering factor to ignore China’s development. We should attempt to study the Chinese system with an open mind to find out how they succeeded in eliminating poverty.