Indian Economics Thread II

[Sardaukar20]

Well there is a lot of Western and India celebratory noises about production moving out of China. Yes it is true that some production is moving out of China. But here is the catch: its mostly the big and highest-profile consumer international brands who were doing that. Samsung, LG, Panasonic, Apple, Uniqlo, H&M, etc. There are still many more lower-tiered multinational corporations who are either keeping their production in China, or are setting up new production lines in China. Yeah, so Samsung moved a lot of its production out of China. But Bosch is still manufacturing most of their products in China. Siemens still maintained their medium to low-end machinery manufacturing in China. So things are not as bad for China as the Western and Indian media would like to have us believe.

There are world-beating industries in China that the West and India can only dream of matching. Such as:

1) Batteries: CATL is a world leader in batteries. The biggest EV automakers in the world like Tesla, Ford, BMW are sourcing batteries from CATL for their own EV products. We can also find Chinese batteries in smartphones, laptops, toys, solar power stations, emergency power backup systems, etc.
2) Electric Vehicles: Not just EV car companies like Xpeng. I'm talking about the many more electric buses, electric scooters, and other less-glamorous EVs that China is exporting around the world without serious rivals.
3) Rail transport industry: HSR export is only the tip of the iceberg. China has exported untold numbers of railcars, rolling stocks, and locomotives.
4) Consumer drones: DJI is the world leader in consumer drones. In 2020, DJI captured 70% of the consumer drone market.
5) Construction: Chinese construction companies are practically everywhere, building tunnels to skyscrapers around the world.
6) Shipbuilding: China is the largest producer of ships in the world. CSSC had finished building Ever Alot this year, the largest container ship in the world.
7) Contract manufacturing: Despite major international brands leaving China. There are lines of smaller companies wanting to contract manufacture their products in China. For example Russell Taylors, a Malaysian upstart appliance company can just suddenly appear on store shelves in Malaysia. They practically did a rebrand deal with some appliance manufacturers in China. So anyone with enough money can quickly produce their own line of products, by leveraging the manufacturing power of China.
8) Toys, trinkets, fireworks, and other products where China is, and still remains the leading manufacturer and exporter.

All of these great achievements are happening without China talking big. The Chinese govt and its media are not screaming to the world that China is #1, or that China is gonna whoop the West's ass. It's the West that is sounding the alarm about China's great achievements. Its India that must scream to the world, that if China can do it, then India would somehow do it better and become Supapower.

Yeah, so Apple is moving some of their manufacturing from China to India. Does that mean that India is gonna take China's place one day? Absolutely not. Why? Because of India itself. Big talkers, but not much else going on. Apple is not the first big multinational company to build production lines in India. There were many others who have done so over several decades. They did manufacture in India: automobiles, machinery, chemicals, appliances, etc. Yet India still vastly lags behind China in every metric of supply chain and manufacturing to this day.

The best example of Indian industrial competitiveness is the Indian automotive industry. The Indian automotive industry predates the Chinese one by several decades. Yet today, China is the largest automaker in the world, and is set to dominate the EV market in the near future. India's Hindustan Motors manufactured what is practically the same Hindustan Ambassador from 1957 to 2014. While China's FAW manufactured the Jiefang CA-30 in the 1950s, but by 2014, already manufactures the Jiefang J series of trucks, which were globally up to date. China progresses while India stagnates. Indian leaders and society today are still talking about India having an edge over China in XYZ... and so JH! So Indian stagnation is likely to continue for the foreseeable future.

 

[ansy1968]

Well there is a lot of Western and India celebratory noises about production moving out of China. Yes it is true that some production is moving out of China. But here is the catch: its mostly the big and highest-profile consumer international brands who were doing that. Samsung, LG, Panasonic, Apple, Uniqlo, H&M, etc. There are still many more lower-tiered multinational corporations who are either keeping their production in China, or are setting up new production lines in China. Yeah, so Samsung moved a lot of its production out of China. But Bosch is still manufacturing most of their products in China. Siemens still maintained their medium to low-end machinery manufacturing in China. So things are not as bad for China as the Western and Indian media would like to have us believe.

There are world-beating industries in China that the West and India can only dream of matching. Such as:

1) Batteries: CATL is a world leader in batteries. The biggest EV automakers in the world like Tesla, Ford, BMW are sourcing batteries from CATL for their own EV products. We can also find Chinese batteries in smartphones, laptops, toys, solar power stations, emergency power backup systems, etc.
2) Electric Vehicles: Not just EV car companies like Xpeng. I'm talking about the many more electric buses, electric scooters, and other less-glamorous EVs that China is exporting around the world without serious rivals.
3) Rail transport industry: HSR export is only the tip of the iceberg. China has exported untold numbers of railcars, rolling stocks, and locomotives.
4) Consumer drones: DJI is the world leader in consumer drones. In 2020, DJI captured 70% of the consumer drone market.
5) Construction: Chinese construction companies are practically everywhere, building tunnels to skyscrapers around the world.
6) Shipbuilding: China is the largest producer of ships in the world. CSSC had finished building Ever Alot this year, the largest container ship in the world.
7) Contract manufacturing: Despite major international brands leaving China. There are lines of smaller companies wanting to contract manufacture their products in China. For example Russell Taylors, a Malaysian upstart appliance company can just suddenly appear on store shelves in Malaysia. They practically did a rebrand deal with some appliance manufacturers in China. So anyone with enough money can quickly produce their own line of products, by leveraging the manufacturing power of China.
8) Toys, trinkets, fireworks, and other products where China is, and still remains the leading manufacturer and exporter.

All of these great achievements are happening without China talking big. The Chinese govt and its media are not screaming to the world that China is #1, or that China is gonna whoop the West's ass. It's the West that is sounding the alarm about China's great achievements. Its India that must scream to the world, that if China can do it, then India would somehow do it better and become Supapower.

Yeah, so Apple is moving some of their manufacturing from China to India. Does that mean that India is gonna take China's place one day? Absolutely not. Why? Because of India itself. Big talkers, but not much else going on. Apple is not the first big multinational company to build production lines in India. There were many others who have done so over several decades. They did manufacture in India: automobiles, machinery, chemicals, appliances, etc. Yet India still vastly lags behind China in every metric of supply chain and manufacturing to this day.

The best example of Indian industrial competitiveness is the Indian automotive industry. The Indian automotive industry predates the Chinese one by several decades. Yet today, China is the largest automaker in the world, and is set to dominate the EV market in the near future. India's Hindustan Motors manufactured what is practically the same Hindustan Ambassador from 1957 to 2014. While China's FAW manufactured the Jiefang CA-30 in the 1950s, but by 2014, already manufactures the Jiefang J series of trucks, which were globally up to date. China progresses while India stagnates. Indian leaders and society today are still talking about India having an edge over China in XYZ... and so JH! So Indian stagnation is likely to continue for the foreseeable future.

Those who leave can't compete, those who stay will become global leaders. @Sardaukar20 circa 2022

The India story is strong today and stronger tomorrow. Modi circa 2020

 

[In4ser]

While history does suggest continued empty words and incompetence, the situation in India has not been static. Despite underperforming compared to China, it has been growing with increased business consolidation and government centralization may yet allow India to transform itself. Japan and S. Korea modernized themselves via Zaibatsus and Chaebols respectively and India has a significant overseas community that is highly educated and well connected in the West.

China should be wary of becoming arrogant or complacent as it is always better to overestimate than underestimate others. However at this moment, China should be keep an eye out and heed the lessons and mistakes the US did in competing with China. Time will tell but for now, China needs to engage with India as the Cold War with the USA and shaping a New World Order should take priority.

 

[coolgod]

While history does suggest continued empty words and incompetence, the situation in India has not been static. Despite underperforming compared to China, it has been growing with increased business consolidation and government centralization may yet allow India to transform itself. Japan and S. Korea modernized themselves via Zaibatsus and Chaebols respectively and India has a significant overseas community that is highly educated and well connected in the West.

Growing slowly is not enough to advance in modern-day geopolitics. There is a reason why the phenomenon of middle-income trap exist in the world. Take a look at the most prominent post WWII industrialized regions that escaped the middle-income trap (Japan, South Korea, Singapore, Taiwan, Hong Kong, now China), notice a pattern i.e., Sinosphere?

How come Brazil or any of the South American countries, or India and its surrounding countries never escaped the middle-income trap? The key difference isn't the geography, population, or resources, but culture.

 

[canniBUS]

Growing slowly is not enough to advance in modern-day geopolitics. There is a reason why the phenomenon of middle-income trap exist in the world. Take a look at the most prominent post WWII industrialized regions that escaped the middle-income trap (Japan, South Korea, Singapore, Taiwan, Hong Kong, now China), notice a pattern i.e., Sinosphere?

How come Brazil or any of the South American countries, or India and its surrounding countries never escaped the middle-income trap? The key difference isn't the geography, population, or resources, but culture.

The key difference is not culture but the fact that these countries all received significant investment and technology transfer from the West so they could counter the USSR during the cold war. Another important factor is that these countries engaged in land reform freeing the peasants from working for an unproductive landlord class. Also Japan does not count as escaping the middle income trap country since it was already an industrialized imperialist power before WWII.

 

[ansy1968]

While history does suggest continued empty words and incompetence, the situation in India has not been static. Despite underperforming compared to China, it has been growing with increased business consolidation and government centralization may yet allow India to transform itself. Japan and S. Korea modernized themselves via Zaibatsus and Chaebols respectively and India has a significant overseas community that is highly educated and well connected in the West.

Bro the Collective West will never allow India to become another China, Globalization is dead and Regionalism is in and India is despised in her sphere of influence, thus can't create a bloc that may harness her potential in fact her neighbors are conspiring against her. Its unfortunate cause India had that soft power to influence her neighbors as part of the former British empire, She have to join the Russian and Chinese entente to become relevant.

China should be wary of becoming arrogant or complacent as it is always better to overestimate than underestimate others. However at this moment, China should be keep an eye out and heed the lessons and mistakes the US did in competing with China. Time will tell but for now, China needs to engage with India as the Cold War with the USA and shaping a New World Order should take priority.

Correct IF China is dealing with a rationale actor which isn't.

 

[coolgod]

The key difference is not culture but the fact that these countries all received significant investment and technology transfer from the West so they could counter the USSR during the cold war.

Countries all around the world received significant investment and technology transfers from the west during the cold war, you don't see the rest of them escaping the middle-income trap. Philipines was much richer (compared to the Sinosphere) and received lots of western investment as a counter against communism in the region, same with Thailand. Both countries continued to grow in the past 70 years, look at them now, stuck in the same place.

South and Central America is same story, the whole region received massive investment from the west to counter communism, they kept growing slowly but still end up stuck in the same place. The west gave tech transfers to many countries, most of them didn't take advantage of this and remains stuck in the middle-income trap. This narrative that the west pick and choose winners to industrialize is propagandized by many sides but it just doesn't hold up to facts.

Another important factor is that these countries engaged in land reform freeing the peasants from working for an unproductive landlord class.

If this really was the secret recipe why did the rest of the world not do the same? Most of the countries under/allied with the communist bloc practiced land reform, to this day they still didn't reach or escape the middle-income trap.

Every culture has its pros and cons, being able to rapidly industrialize (look at Vietnam now compare to the rest of developing countries) is clearly one of the beneficial traits of the Sinosphere culture.

 

[Topazchen]

The key difference is not culture but the fact that these countries all received significant investment and technology transfer from the West so they could counter the USSR during the cold war. Another important factor is that these countries engaged in land reform freeing the peasants from working for an unproductive landlord class. Also Japan does not count as escaping the middle income trap country since it was already an industrialized imperialist power before WWII.

The idea that there would be a tech transfer from the West to India should not even be entertained.

India is just too independent to be subservient to western interests and they this will not be lost on western policy makers as they engage her economically.

An India with a 15 trillion dollar gdp would be competing for the same resources with the West.

 

[Sardaukar20]

While history does suggest continued empty words and incompetence, the situation in India has not been static. Despite underperforming compared to China, it has been growing with increased business consolidation and government centralization may yet allow India to transform itself. Japan and S. Korea modernized themselves via Zaibatsus and Chaebols respectively and India has a significant overseas community that is highly educated and well connected in the West.

Well. I would not equate the Indian tycoons to the Zaibatsu and Cheabols. While they appear similar on paper. Their behavior is far from similar. The Zaibatsus and Chaebols were ruthless, but also genuinely very competitive. Yes they were corrupted, and they hold immense power over politics just like the Indian tycoons. But their similarities end with competence. The Indian tycoons have shown time and and again, a very fundamental Indian style of doing business. Talk big, but do little. Indian tycoons lacked accountability. Victory is always announced ahead. But when setbacks or defeat comes, they spin it, ignore it, or blame someone else. The Zaibatsus, Chaebols, and Chinese industrialists, don't do that. They are serious people. They focus on achieving results, not declaring that they've already won. Because the East Asian societies have a low tolerance for BS. The East Asian corporate giants usually stun the West with their results, not their words.

Indian tycoons hardly think through what they boast to the world. Ratan Tata announced to the world that the Tata Nano will be the world's cheapest car. That it'll become the car of choice for the poor people in India and around the world. Sounds great on paper, but unattainable from an engineering standpoint. He put the cart ahead of the horse. When the great Japanese automakers made cars that would shake the American auto market, they didn't announce anything. They just let their products do the talking.

Next, Ambani said that Jio 5G will be the biggest in the world by Dec 2023. I don't believe him. He doesn't know what the hell is going on in China and the rest of the world. China is geographically bigger, and has a far more urbanized population than in India, hence a far larger 5G coverage, and utilization. Ambani doesn't control the key technologies for 5G, yet he declared that Jio 5G will be the world's most advanced. Ambani and Adani declared that India will be a USD 30-40 trillion economy in 2047. But they never cared to set out a serious plan as to how India will go from USD 3.5 trillion to 40 trillion in 25 years. All they have are their big mouths, and big egos. Men like these control a large part of the Indian economy. It is also men like these who contribute greatly to the stagnation of India.

We cannot compare India to China. They are only similar in population size. But they are not the same in terms of work ethic and integrity. They way that India runs its economy is much closer to Brazil, Malaysia, and South Africa. These are nations with strong potential ahead of them. Are democracies. Are multicultural. They have started opening up trading with the West decades ahead of China. All possess notable high-tech industries. All have their big oligarchs. All have their loud politicians. But all have also fallen into the middle-income trap, and stagnated for decades.

China should be wary of becoming arrogant or complacent as it is always better to overestimate than underestimate others. However at this moment, China should be keep an eye out and heed the lessons and mistakes the US did in competing with China. Time will tell but for now, China needs to engage with India as the Cold War with the USA and shaping a New World Order should take priority.

This I agree. China must guard against arrogance and complacency. The one advantage for China today, is that it had experienced and recorded the disastrous results of arrogance and complacency. Namely the "Century of Humiliation" resulting from the arrogance and complacency of the Qing dynasty. China also learned many lessons from the failures of the Soviet Union, and the now the US. It is actually a great thing that the CPC now operates on the doctrine of "Continuous Reform", not allowing themselves to be limited by ideology, or dogma. This leaves the CPC with plenty of flexibility to adjust to necessary changes. This is indeed one of the big the lessons of the "Century of Humiliation".

Nevertheless, the problem for China right now is not really arrogance and complacency. It is exactly the opposite. China's self-marketing to the world is still quite underdeveloped. That is why much of the Anglosphere are unaware just how far China have come. But they readily accept assumptions that China is backwards, about to collapse, or are gonna fade out. Because India is also in the Anglosphere, they readily accept these BS about China, and market themselves as the 'superior' alternative. It is also the Western political bias that hyped up India immensely, making India look much bigger than it actually is. This is a good thing in my opinion. It keeps the West ignorant to China's rise, and India from making any sincere self-reflection.

China needs to treat India for what it is. If India wants to grow peacefully with China, then there is no problem to becoming friends. But if India wants to grow, but also undermine China, then they cannot be friends. No-one should ever again be allowed to make money from China, but also bully and undermine China.

 

[56860]

The key difference is not culture but the fact that these countries all received significant investment and technology transfer from the West so they could counter the USSR during the cold war. Another important factor is that these countries engaged in land reform freeing the peasants from working for an unproductive landlord class. Also Japan does not count as escaping the middle income trap country since it was already an industrialized imperialist power before WWII.

Why did these countries receive investment and tech transfers from the west? Do western companies just give away their technology for free? Why do western companies invest predominately in China, Japan, Korea, Singapore, Taiwan, Hong Kong -- and not India or Brazil?