Thursday, June 09, 2005
Hoagland on the Asian century
Regular Washington Post op-ed contributor and foreign policy guru Jim Hoagland has his take on the Asian century, which is at odds with that of other pundits. He thinks India will come to dominate the 21st century, not China.
Current straight-line projections of China's rise to power neglect developments and adjustments in other Asian countries, particularly in the region's two great democracies, India and Japan. The "smart money" literally favors China. Foreign companies pour billions upon billions into direct investment there. But what if they are pouring 21st-century dollars or yen into a great 20th-century power? Politically, China is ruled by Leninists who must maintain the status quo. Militarily it relies on a large, underequipped land army. Economically it has adapted and mastered Henry Ford's assembly line on a continental scale. Financially it hordes its cash, regulates its markets with zeal and defensively uses fiscal policy to prevent mass upheaval.
India, on the other hand, has set out to become "a global knowledge hub, with a central place in the transnational movement of knowledge and services," Nath said in a conversation here last week. He argued that India's comparative advantage lies in its large and relatively young educated population. Seventy percent of India's 1.1 billion people are literate -- many of them are fluent in English -- and about half are under 30.
Nath's argument intrigues because it incorporates global demographic trends often ignored or glossed over because of the social and political dilemmas they create. Prime among these is the galloping aging of the population of advanced industrial societies that will not accept greater immigration flows to renew their labor forces. Where do these countries turn when they have too few workers to meet demand for goods and services -- and to support retirees? "The answer is to move information and services, rather than people, across borders," according to Nath.
Hoagland also quotes Undersecretary of State, Nicholas Burns, who seems to reflect a new thinking in the Bush administration and State about South Asia as a whole, and India in particular.
"The greatest change you will see in the next three or four years is a new American focus on South Asia, particularly in establishing a closer strategic partnership with India . . . If you look at all the trends -- population, economic growth, foreign policy trends -- there's no question that India is the rising power in the East. . . . I think you'll see this as a major focus of our president and our secretary of state, and it will be the area of greatest dynamic positive change in American foreign policy."
Mind you, Jim Hoagland is a known India supporter, so anything he says is to be taken with a pinch of salt. Nonetheless, it is pretty intriguing that we've had two successive days of influential columnists (yesterday was Friedman's turn) touting India's merits over China. Maybe the Chinese decision to clamp down further on free speech has infuriated them and reminded them of the problems within China that refuse to go away despite all of the economic growth?
Current straight-line projections of China's rise to power neglect developments and adjustments in other Asian countries, particularly in the region's two great democracies, India and Japan. The "smart money" literally favors China. Foreign companies pour billions upon billions into direct investment there. But what if they are pouring 21st-century dollars or yen into a great 20th-century power? Politically, China is ruled by Leninists who must maintain the status quo. Militarily it relies on a large, underequipped land army. Economically it has adapted and mastered Henry Ford's assembly line on a continental scale. Financially it hordes its cash, regulates its markets with zeal and defensively uses fiscal policy to prevent mass upheaval.
India, on the other hand, has set out to become "a global knowledge hub, with a central place in the transnational movement of knowledge and services," Nath said in a conversation here last week. He argued that India's comparative advantage lies in its large and relatively young educated population. Seventy percent of India's 1.1 billion people are literate -- many of them are fluent in English -- and about half are under 30.
Nath's argument intrigues because it incorporates global demographic trends often ignored or glossed over because of the social and political dilemmas they create. Prime among these is the galloping aging of the population of advanced industrial societies that will not accept greater immigration flows to renew their labor forces. Where do these countries turn when they have too few workers to meet demand for goods and services -- and to support retirees? "The answer is to move information and services, rather than people, across borders," according to Nath.
Hoagland also quotes Undersecretary of State, Nicholas Burns, who seems to reflect a new thinking in the Bush administration and State about South Asia as a whole, and India in particular.
"The greatest change you will see in the next three or four years is a new American focus on South Asia, particularly in establishing a closer strategic partnership with India . . . If you look at all the trends -- population, economic growth, foreign policy trends -- there's no question that India is the rising power in the East. . . . I think you'll see this as a major focus of our president and our secretary of state, and it will be the area of greatest dynamic positive change in American foreign policy."
Mind you, Jim Hoagland is a known India supporter, so anything he says is to be taken with a pinch of salt. Nonetheless, it is pretty intriguing that we've had two successive days of influential columnists (yesterday was Friedman's turn) touting India's merits over China. Maybe the Chinese decision to clamp down further on free speech has infuriated them and reminded them of the problems within China that refuse to go away despite all of the economic growth?
