March 8, 2006

"It is not top-down but bottom-up"

My son sent me a link to a good article on India...

....India's growth is messy, chaotic and largely unplanned. It is not top-down but bottom-up. It is happening not because of the government, but largely despite it. India does not have Beijing and Shanghai's gleaming infrastructure, and it does not have a government that rolls out the red carpet for foreign investment—no government in democratic India would have those kinds of powers anyway. But it has vast and growing numbers of entrepreneurs who want to make money. And somehow they find a way to do it, overcoming the obstacles, bypassing the bureaucracy. "The government sleeps at night and the economy grows," says Gurcharan Das, former CEO of Procter Gamble in India.

There are some who argue that India's path has distinct advantages. MIT's Yasheng Huang points out that India's companies use their capital far more efficiently than China's; they benchmark to global standards and are better managed than Chinese firms. Despite being much poorer than China, India has produced dozens of world-class companies like Infosys, Ranbaxy and Reliance. Huang attributes this difference to the fact that India has a real and deep private sector (unlike China's many state-owned and state-funded companies), a clean, well-regulated financial system and the sturdy rule of law. Another example: every year Japan awards the coveted Deming Prizes for managerial innovation, and over the last four years, they have been awarded more often to Indian companies than to firms from any other country, including Japan....
....Americans also find India understandable. They are puzzled and disturbed by impenetrable decision-making elites like the Chinese Politburo or the Iranian Council of Guardians. A quarrelsome democracy that keeps moving backward, forward and sideways—that they know.....

....Most countries have relationships that are almost exclusively between governments. Think of the links between the United States and Saudi Arabia, which exist among a few dozen high officials and have never really gone beyond that. But sometimes bonds develop not merely between states but between societies. Twice before the United States had developed a relationship with a country that was strategic but also much more—with Britain and later with Israel. In both cases, the resulting ties were broad and deep, going well beyond government officials and diplomatic negotiations. The two countries knew each other, understood each other and as a result became natural and almost permanent partners. America has the opportunity to forge such a relationship with India.....

Fascinating stuff. And that bit about India winning the Deming prize more often than any other country is amazing. See also this post by Jim Bennett:

As to where India stands with the Anglosphere, well, that's a work in progress. The key issue at this point is the rate at which English fluency and Anglosphere-linked jobs (IT and call-center) penetrate below the traditional English-speaking elites of India. That appears to be happening at a fast, maybe even exponential rate. At some point before too long (probably between 2015 and 2020) India will have more home users of English than the US; not much longer afterwards, there could be more home users of English in India than the rest of the Anglosphere combined. This (especially given the cheapness of electronic publishing and dissemination) will mean that the bulk of English-language media will be produced in India. (If Bollywood learns how to appeal to US audiences, which it eventually will, that will also be true of visual media as well.) That means that not only will the Anglosphere change India, but India will change the Anglosphere.

Not many people are thinking about what this really means. They should be. Bush's trip to India, and the deal made there today, may end up being the single most consequential act of the Bush presidency.
Posted by John Weidner at March 8, 2006 9:36 PM
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