Why India? #2

India is finally waking from its slumber

Soon enough I hope to remove the question-mark from this series of posts even though that might appear optimistic given India’s track-record of (self-imposed) failures. I’m no Aunt Sally: I am not trying to look on the bright side, nor to poke around for morsels of good news among the gristly stuff. I’m not a Trümmerfrau either, picking among the wreckage and piling up the bricks and masonry strewn around the bombsite to start building an impossible future. I am in fact a hopeful skeptic rather than a pessimist.

For pessimism is an aspect of nihilism and nihilism is an aspect of narcissism, which is itself an aspect of solipsism. India has been subjected to quite enough of that.

India has also been the victim of skewed perceptions since Independence, and has mostly believed what it has been told.

For example, it is difficult to grasp the economic potential and promise of India, partly because in geographic terms it is relatively insignificant, covering much less than half the land mass of the USA or China – which are almost identical in size, at 3,805,927 and 3,705,407 square miles respectively – and only one fifth of the territory of Russia, which is 6,592,800 square miles excluding the Crimea.

Also, India at a mere 1,269,346 square miles has more than three times the population of the USA and almost exactly the same population as China; it will soon have a larger one. Does that sound crowded? Well, it really isn’t, even if India will soon contain more people than any other country on earth. Russia, by contrast, is in relative terms deserted. It has a headcount lower than that of the United States and spread out over a far larger expanse.

Furthermore, India has a young and growing population, with 60% of its people under the age of 35 and a two decades-long demographic ‘sweet spot’ to look forward to. In 2025 the Median age of an Indian will still be just 30.8 years. The populations of China, Russia and the USA, on the other hand, like Japan’s, are already speedily moving into decline. China’s population is also rapidly aging, with nobody to look after the old thanks to the one-child rule and infanticide of female babies and foetuses. Russia’s population is in precipitous decline to the extent that it won’t even be able to keep the lights on in a few decades, while Islamic fundamentalism threatens its administrative integrity from both within and without. The USA’s population is flat and falling slowly only thanks to immigration from Latin America, although many of those visitors return home during recessions.

Looked at comparatively, even from space, it is India with its distinct shark’s tooth shape biting down through the Arabian Sea and the Bay of Bengal, that is the place with the potential: human – that young and growing population – cultural and economic.

In his 1997 book Guns, Germs and Steel, Jared Diamond pointed out something profound when he described the fates of countries and nations as being bound up with their geography. Vertically aligned continents (Africa, the Americas) experience slower and more discontinuous development that horizontally aligned ones, for example (Eurasia). This is to do with the way landscape is formed and more importantly the climate at certain latitudes. For example, Tuscany, Iran and Japan, noted Diamond, experience almost the same climate and therefore a similar destiny with relation to domestication of crops and development of farming/advanced civilisation, because they also share a latitude. History bears this out. The point he was making can be extrapolated in the comparison of the future prospects of China, the USA, Russia and India.

All but the last include huge areas with a high proportion of desert, the prosperous and inhabited areas therefore separated by prohibitive or at least difficult distances. In the case of the USA and China, the vast majority of commerce and population, proportionally speaking, lies on the coasts. The interiors are howling wastelands – I exaggerate, but not by too much (as the gourmands say: if you are visiting Utah, be sure to eat first). China’s Taklamakan desert, its Wild West, is hard to inhabit. The Chinese government has built vast infrastructure to encourage people to move westwards but hardly anybody is interested in doing so. Ghost cities and roads to nowhere.

As Herb Meyer points out, the USA moved west as well, distributing settlers as it went. In that case, though, the government expenditure on infrastructure (railways and roads etc) came after the settlement, from demand from private citizens living in the places where infrastructure was now needed. Modern China is therefore an example of putting the cart before the horse. Russia has a cart but no horse, or the other way round; it hardly matters.

What has all this to do with India? It is true that India has squandered much of its potential until now. On the other hand that means it has avoided some mistakes. From now on there is more upside than downside: as Taleb would say, India is now convex. I mean that India as it awakes from its slumber will realize the advantages of having a compact and well-connected landmass, criss-crossed by railways and roads, densely studded with cities and irrigated with waterways in an almost grid-like way. Nowhere in India need be a hopeless desert. Everywhere is close to some other place. You can live anywhere and if it wasn’t filthy and had some lighting it would be just fine. An of course it has a young and growing population.

Even the western desert states, Gujarat and Rajasthan, are becoming more inhabitable. Gujarat was desertifying at a frightening rate until Modi turned it around (by privatising electricity and charging for it – a long story; see my book). Now it almost looks like Oxfordshire. It has been estimated that if just 30% of the monsoon rains (yes, the entire country is drenched annually in water – tough luck Arizona and Qinghai) are saved instead of being allowed to run off, India’s water shortages would vanish. Modi is building a national network of canals with this in mind, and the canals are being roofed with solar panels. You get the idea.

Before 2004 the previous BJP administration built many roads that swelled economic activity in India. The Congress-led administration of 2004-2014 let them crumble to dust (presumably to teach the Indians not to vote for a different party), but Modi’s government is now rebuilding at a rate of 12 km per week. Bullet trains are coming, and they don’t have to travel the distance of the Trans-Siberian Express from A to B.

On the other hand the dilatory Congress government inadvertently helped in certain ways and must be given credit for its idleness.

For example, India possesses the fifth largest coal reserves in the world. Congress, listening to western eco-activists (Prince Rahul’s hippoid buddies), basically shut down the country’s mining operations such that India was by 2014 a massive importer of expensive foreign coal. The upside of that was the fact that India has resisted becoming reliant for revenue on exporting commodities to China over the past bubble-price decade, and is therefore not suffering now from the crash in prices. Indeed, it is in a good position to benefit from low import prices of raw materials.

It is my belief that the question-mark of the post’s title will indeed be removed before too long.

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