How India can become a developed country
primary education and healthcare, and the inclusion of women as equal participants in the nation’s growth. Today, the work participation rate for Chinese women is 60%, about three times India’s figure. Some would add to the socialist achievements the restoration of dignity to manual labour and the building of rural physical infrastructure through communal labour of a kind that market-based cost-benefit calculus would not have justified.
Then, Deng Xiaoping broke the communal pot, declared that to get rich was glorious, and set up special economic zones for foreign ventures. China was admitted to the World Trade Organization in 2000 and soon emerged as a global export powerhouse. The bulk of output came from industry and services, and land ceased to be the primary asset.
A decentralised political system that incentivised local administrators to maximise output in their regions led to the growth of towns and cities as they competed for investments in manufacturing and the services that enable industry. Thousands of towns and cities came up, driving up demand for steel, cement, power, glass, paint, construction equipment and workers. Highways and high-speed rail, as well as ultra-high voltage direct current transmission lines, connected towns and drew in ever-more investment. Well-planned logistics made for efficient, interconnected networks to produce and assembly parts.
Neighbouring East and Southeast Asian economies joined in these supply chains. Investment in research and development also grew massively. Since 2014, two years after Xi Jinping became China’s supreme leader, China has been spending more than 2% of GDP on R&D.
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