India has often been advised to follow the path of China in public investment in human capital. China has done well in the last decade, but it would be a disaster if India were to follow her example. China’s approach can be called “two quick steps forward, one slow step back.” India’s approach, in contrast, is “one slow step forward.” The end result of both approaches turns out to be quite similar. But in the short run, China appears to be ahead with her two quick steps.
Buddhist philosophy has two streams that typify these different approaches. Mahayana asks the seeker to work for the betterment of the world. The seeker is advised to dissolve his ego into the common good. Chinese governance is closer to this system. The Chinese follow their leader more or less unquestioningly. Policy correctness is secured by the leader, who corrects himself as mistakes become clear, since he is driven by a deep desire to better the people’s lot.
The Hinayana, on the other hand, asks the seeker to withdraw from the world and seek individual salvation though meditation. Hindu philosophy advocates much the same thing. It adds, however, that the seeker should resist the tyrannical ruler. Correctness is secured by friction between the rulers and such seekers — the Brahmins. Facing incessant debates by these Brahmins, leaders are unable to take quick decisions. Yet slowly there emerges a decision that is close to the correct path.
China has a history of mighty reversals, while India has tales of slow action. In the 1950s, China’s Communist government quickly organized agriculture into cooperatives. These were subsequently merged into about 25,000 communes. In many cases, even small private plots were abolished. At that time, this was heralded as a great advance. In his “Chinese Road to Socialism,” the pro-Communist author says that “there were solid achievements by the communes and more than 16.5 million mou of land were brought into irrigation. A 30 percent increase (in agricultural production) was probably achieved.” But then production faltered. Deng Xiaoping broke the land up into small private farms in the early ’80s. The quick action of cooperativization was followed by a slow partial reversal.
India’s land-reform program was slow to take off. India debated for a full 10 years and then took another decade to implement the decision. Large farms were broken up and small private farms were established. The result in both cases was the same; only the approach differed.
In the mid-’50s, China embarked on an ambitious program of small-scale industrialization called the Great Leap Forward. The most exciting feature was Mao Zedong’s call to make iron in every back yard. Similar small factories were set up to produce acid, soda, fertilizers, pesticides and to mine coal. This effort, however, could not be sustained. Peasants found themselves overburdened with work. The quality of output was poor and the cost high. In the early 1960s, this policy was reversed. The New Economic Policy, which established large state enterprises, was put in place. These are now being privatized and China has, for the present, adopted a mixed economy.
In contrast, it took Indian rulers 10 years to make up their minds. India set up steel plants both in the private and public sectors from the very beginning. Those plants still produce steel, often at internationally competitive prices.
In the mid-1960s, Mao unleashed the famous Cultural Revolution. University professors were labeled “bourgeois” and sent to do manual work and learn from the people. In the ’80s, the same professors were reinstated. Valuable teaching was lost for more than two decades. In contrast Indian universities, howsoever slowly established, have continued to churn out graduates at a regular pace.
Chinese Mahayana-type governance has been characterized by a deep concern for the welfare of the people. It is matched by an equally strong veneration of the state by the people. The government takes a quick decision and the people follow. As the errors become clear, the leadership changes course and again the people follow. Their growth occurs in spurts: two quick steps forward, one slow step backward. Quick results were achieved when land was collectivized, back-yard steel production was started and professors were sent to do manual labor. In the end, however, these policies were reversed and China reached much the same point as India — land was parceled out in small private farms, private and state enterprises coexisted, and standard teachers churned out standard graduates.
India’s Hinayana-type governance is much slower and often appears fractured. People discuss and debate and criticize endlessly. Each follows his self-interest. The friction between the rulers and the people is an essential part of the country’s style of governance.
Both approaches have been sustained through five millennia. It is not, therefore, a question of either one being right or wrong. It is a question of which approach suits which mind-set.
If China were to debate endlessly as Indians do, it would lead to as many problems as if Indians were to take quick decisions. A lion must behave as one and not follow the elephant.
At present China appears to be ahead in the race. Its growth rate is higher than India’s, as are its achievements in health and education. But China is also saddled with the huge implicit liability of foreign investment. Its indigenous business and financial structures are weak and few years down the road, it may reverse some of these policies. In the end it is difficult to say who will be ahead.
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