For the last two years in a row New Delhi has overcome China. It is on time to register faster gains in 2017 giving it needed credibility after Modi’s demonetization regime collapsed both GDP and public support. Every major index sees India gaining permanent ground against her larger northern neighbor. In population, social stability and mobility, India continues to enjoy greater margins of growth than China. Here’s a few numbers: India today is where China was in 1980. Its literacy rate, demographics and per-head income match China in 2000. This momentum has magnitude. We’ll witness another nation state embrace both John Locke and Adam Smith if only to confirm what Marx denied, the inevitability of material progress when political institutions function.
Every barrier that India faces is self-imposed. This is good news, for it is easily addressed. The most significant barrier will be India’s upper chamber, because most of India’s dominant political “Senatorial” class acts like an oligarchy, it remains susceptible to both archaism and self-dealing. Except this time its citizenry is hooked into media on a scale that could easily threaten any political majority.
As America begins its road of recovery along decentralized lines of engagement: think federalism, state rights and autonomy; India continues to slog about in a near stupor of Marxism centralism. Its GST or general sales tax on goods and services as well as central state budgets, dominant state-owned firms match Aadhaar- a unique identification system registering biometric data for more than 1 billion citizens, is currently up and running. The Central Bank of India claims digitization can provide more efficient targeting of services to the poor and those outside the main economy. India’s cash economy or ‘unbanked’ is very large and in need of reform; something demonetization attempted to do yet failed. India’s vast informal economic sector will require political and social assimilation akin to Imperial writ. The good news is, India can achieve these in record time.
All of the above and Modi’s tenure will be hotly contested in looming elections throughout its northern corridor (Uttar Pradesh), home to mostly 200 million Muslims, throughout 2017.
Watch for trends that upend even the most seasoned policy wonks. The rise of India is permanent.