View: India’s growth has Chinese characteristics
GDP growth.” That was the marketing blitz India took to Davos in 2006. The idea was not so much to woo the West overnight as to wean it away from its fascination with China, whose gross domestic product back then was expanding at double-digit rates.
Eighteen years later, India is hosting a second coming-of-age party this week at the World Economic Forum in the Swiss Alpine town, though in vastly changed circumstances.
For one thing, the most-populous nation no longer needs qualifiers like “the world’s fastest-growing free-market democracy” to highlight its exceptionalism — at 7.3%, it’s expanding quicker than any other major economy. Nor does New Delhi need to apologize for frequent political change.
Narendra Modi has been prime minister for the past decade, and will most likely win a third five-year term. For a West that has fallen out of love with China under President Xi Jinping, India is quite naturally the next big thing.
But there is a fly in the ointment. The structure of the Indian economy is also turning Chinese, or at least exhibiting characteristics associated with the People’s Republic.
The world’s second-largest economy has relied too much on investment, and suppressed consumption. Continuing with the status quo may worsen its debt overhang. But shifting gears won’t be easy either.
India has always been different.
