Awakening Giants, Feet of Clay: Assessing the Economic Rise of China and India
Pranab Bardhan
Oxford University Press
Pages: 168 Rs 495
Assessing the economic rise of China and India, also the subtitle of Pranab Bardhan’s new book, is without doubt the fashionable subject of our times, especially in the post-financial crisis period. There is plenty of conventional wisdom that celebrates these two emerging economies as the stars of the future. Bardhan’s book, on the other hand, challenges much of the celebratory literature on the two countries.
The book isn’t likely to please free-market enthusiasts. One of the “wisdoms” the Berkeley economist argues against early on is what he believes is disproportionate credit given to liberalisation and globalisation in explaining the success of these economies between 1980 and 2005. In India’s case, Bardhan argues, since economic reform has largely focused on liberalising trade and industrial policies, it is the corporate sector that has benefited by becoming more efficient. However, the formal corporate sector employs only about 5 per cent of the workforce and so the broader benefits of economic reform are questionable according to the author. Provocatively, Bardhan also argues that the rate of poverty decline in India in the post-reform period of 1993-2005 hasn’t be any higher than the rate of decline in the 1970s and 1980s. Of course, it is possible to counter both these propositions — poverty statistics are dodgy at best and Bardhan may be underestimating the spillover effects of economic liberalisation. But the author does manage to highlight the enormity of the task that lies ahead of India.
Full review here Indian Express
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