India to topple Japan as world's 3rd-largest economy
timesofindia.indiatimes.com
timesofindia.indiatimes.com
Or Mongolia for the 133rd position, depends upon who's list you look at.
Don't forget the huge income inequality.
India's growth is mainly because of growth of service industry, manufacturing and modern agriculture techniques. The countries that you have mentioned have higher per capita income because of huge natural resources and less population.
Iraq -> Huge Oil reserves / Small population
Mongolia -> Huge mineral resources / tiny population
I'm hoping you are not trying to say you need a lot of natural resources and less population to be rich.
Singapore -> Almost no resources, pretty dense population. Singapore is much much ahead.
The country has such a long way to go before it can stand on the same footing as the US or even some of the European countries whose economies it is supposedly surpassing.
EDIT: Also contrast it with Brazil, where the bottom 5% make about the same as the bottom 5% of China, while the top 5% make almost what the top 5% in the US make.
The bottom 5% of households in the US make nominally more than the top 5% of households in China, but I'm willing to be the bottom 5% in the US lives far worse than the top 5% in China.
If anything, go ahead and Google for China's empty cities. Frankly, I would not want to be anywhere near that bubble when it bursts. The only point of consolation is that the Chinese still have a tight control over all aspects of their society, so they might be in a better shape to recover when their banks go bust.
So even though the country at large is poor, 130 million people could become your potential customers, spending on par with other wealthy nations in the west.
In terms of income, the vast majority of those people have real income lower than the bottom 5% of Americans and nominal income even lower.
http://economix.blogs.nytimes.com/2011/01/31/the-haves-and-t...
How is that different from the U.S.?
For instance, since Facebook is a Delaware corporation, here is the state of Delaware's Business Registration and Licensing:
And, almost any country/state/city has licensing requirements, of one form or another.
But lets say some govmint wizard decided that the US economy needed only one social networking company. Back in 2004 that would be myspace. So Mark Z would have applied for a license to become the next social networking company, would have waited 10 years to get it, wouldn't have gotten it, and would've eventually leaped off the Golden gate bridge.
That's what socialism is. What the tea-partiers are calling socialism is nowhere near what real, oppressive, mind-bending, government control is.
There is no more "License Raj" in India. But its still quite crazy, not that different.
I am actually more hopeful and bullish about India today than my cynical posts might seem to indicate.
India's GDP might make it 4th (by Purchasing Power Parity) or 10th (nominally), but per person it's down at 129th.
(Figures via: http://en.wikipedia.org/wiki/Economy_of_India and http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PPP... )
From the average individual's perspective, it's more about per capita GDP.
Democracy in its core is the reason for the slow infrastructure, government and social reforms because its like moving a big elephant. China on the other hand is able to be quite nimble with communism. Its interesting. I dont advocate communism because it sounds great in theory but rarely works practically, but it is working for China.
http://en.wikipedia.org/wiki/List_of_countries_by_income_equ...
Moreover, I remember listening to one of The Economist podcasts where someone had done audited Chinese firms more strictly where they don't write off the cheap (free) land government provides, or other give aways. Turns out on a whole Chinese firms are destroyers of capital and not creators. Crudely speaking, they take land and convert it to output X. The value of X tends to be lower than the value of the land.
to topple: verb [ no obj. ] overbalance or become unsteady and fall slowly [ with obj. ] cause to fall in such a way
india rising does not cause japan to fall, in any way.
also, there's a certain triumphalism in such headlines that is, i contend, unworthy of a confident nation and of HN.
last but not least, the measure used is highly flawed, given that the headline seems to aim at india's rising "standing" in world affairs. when you do that, the actual exchange rate counts, not PPP. and there, the picture looks a little different.
just to be clear: none of which is to detract from india's great progress in the last 10 or 20 years, or from its talented population. it's just that this article/headline strikes me as cheap.
Moreover I've often seen the Times of India publishing most of BBC (India region) stories from the day before. Might as well follow that.
> '...but per-capita income of India is so low'
No one has said otherwise. Having a big economy has many advantages and India is expected to grow for decades to come.
> '...but go to Indian cities and you'll see rampant poverty'
So? Poor people migrate to cities in search of opportunities. Unlike China there is no mechanism in India to put restrictions on rural migrants.
> '...gap between rich and poor in India is growing'
Show me one country that is growing 5% or more where the gap between rich and poor is decreasing.
1. India has a family centric society , where welfare of the family gets priority than the welfare of the nation, which is one of the factor for rampant corruption (IMO).
2. The infrastructure is poor.
3. The divide between rich and poor is high! (income inequality)
4. The Public sector is very slow to respond to the growing needs of infrastructure! They have no clue at all!
5. There is still caste system in rural India, where they don't respect fellow country men as a human being.
6. The politics is only for the rich and heirs of powerful politicians (the parliament is filled with sons and daughters of old politicians read:family business)
India has a long way to go!
If you wander around a big city in India you'll see wild dogs and malnourished children, enormous shanty towns and slums. How this nationalistic rag called the india times can proclaim "victory" as having "toppled" Japan is beyond me.
Also - claiming that Russia and India are coming to the aid of European countries is completely ridiculous. India currently receives £1billion + in aid from the UK.
Having a "big" economy because there are 1 billion citizens within that economy doesn't mean anything in itself.
http://elibrary.worldbank.org/deliver/5080.pdf?itemId=/conte...
It is excellent.
And here is the thrilling conclusion:
“China clearly scores well on the pro-poor growth side of the card, but neither Brazil nor India do; in Brazil’s case for lack of growth and in India’s case for lack of poverty-reducing growth. Brazil scores well on the social policies side, but China and India do not; in China’s case progress has been slow in implementing new social policies more relevant to the new market economy (despite historical advantages in this area, inherited from the past regime) and in India’s case the bigger problems are the extent of capture of the many existing policies by non-poor groups and the weak capabilities of the state for delivering better basic public services.”
When do you think is the Right Time to start that "optimization"?
Despite what embittered historians say, the rich and powerful learnt plenty of lessons from the French Revolution. The only reason why some people remain obstinate about it is that they can't really be bothered to see beyond their lifetimes.
I'm not convinced revolutions have much to do with income inequality, but rather the absolute level of poverty among the poor, the opportunities they have to improve their lot, and the input the average person has into the political process.
The other indexes do not capture the true nature if income inequality in these modern times. Comparing the top 10% of income earners with the bottom 10% washes things out because the truly rich are a very small group. They are a mere fraction of the top 1%.
While its true that most european countries have slightly lower GINI, they also have a higher 10% ratio (highest to lowest) than India.
So it's pretty hard to argue from the actual statistics that inequality is the outstanding problem of India as it is often made out to be.
But it's perhaps true that the contrast is more visible in India than elsewhere - with slums next to high rises.
I think the reason for this is that growth is relatively narrowly focussed around a few metros, which then attracts a big influx of job seeking rural population. The other big countries never had such a big rural population to begin with.
But there is this "PPP" thing, which turns India GDP to $4 trillion. Which one is more relevant in this case?
To compare total GDP figures on a PPP basis for two countries, and when one country has 10x as many people doesn't really make sense.
What this comparison says is:
(Total GDP of Japan/Cost of Living in Japan) < (Total GDP of India/Cost of Living in India).
The Japanese economy is still 3x bigger (in terms of total GDP), and has 10x higher PPP GDP per capita, or about 30x the GDP per capita.
It's calculated based on prices paid in India and in Japan or the goods needed to live on; for this reason it's most useful as a measure when looking at per capita incomes to see what a typical person's share of adjusted GDP will buy them. PPP adjusting in theory shows that an Indian in India can enjoy the lifestyle of someone earning three times as much in Japan (provided he buys Indian goods at Indian prices). On the other hand, as soon as you start looking at GDP per capita [adjusted or not] it becomes obvious that Japanese people are on average much, much richer than Indians because Japan's similar level national income is shared between far fewer people.
As an aggregate measure of the economic output PPP adjusted GDP is not entirely useless either as a crude adjustment for labour costs: India can build a lot more skyscrapers for $1.377 trillion (or $1 billion) than Japan could and Indian output is arguably undervalued by raw GDP measures which simply looking at the prices paid. But effectively it's saying that India as a country produces more value than Japan if people were prepared to buy Indian goods at their Japanese value. As there's plenty of opportunity for trade between India and Japan, it's probably fair to say that Indian output probably isn't worth three times it's Indian value to the Japanese, otherwise they'd be buying it all up. Therefore the true value of India's economic output lies somewhere between the $1.4bn at low Indian domestic prices and $4bn at inflated Japanese domestic prices (trade isn't perfectly efficient), still behind Japan.
Yes the country is plainly less rich than Japan and the first world, and it shows in big cities. Even comparing big cities in China to India there is a big gap.
But here is what you are missing: as total wealth in India is growing there are indeed some places (which the casual tourist driving around will not see) centered in Mumbai, Bangalore, Delhi that are super rich. One way to spy on it is visit one of the "five star" hotels like JW Marriots etc -- they are numerous, massive, and full of quite rich people with loads of servants and fancy places to live.
By the way, you can find loads of disgustingly miserable poor places in the rich USA too. Maybe they all have sewers and electricity but that's about all that separates parts of the rural US (deep south) or bad urban poverty (right nearby me in NYC) and some villages in India.
Even the poorest place in the US has access to electricity, clean water, sewage disposal, trash disposal, law enforcement, emergency response, phone service, broadcast television, postal service, and the list goes on. This is definitely not true in India or China, and there is a long way to go before they reach that level.
But you are wrong about most of this not being available in most places in India. Maybe sewage isn't great and emergency response sucks, and phone is wireless not landline. But there is definitely postal service and TV! You must be kidding.
But the main point --> a few bits of infrastructure like what you list does not make people happy, comfortable or rich. You can be very poor and miserable here in the US and many millions of people would be much better off if they lived in Mumbai, where at least stuff is cheaper to buy
Second, I wasn't suggesting that only the US has all of these services, and cities in India do not. I was saying that every city (even the poorest) in the US has all of these services, whereas there are many cities and villages in India and China who are lacking some or most of these services. Outside of the major cities in India, would most small villages have these services? I don't think so. I have driven across the United States, and seen towns of 1000 people that have all of the services I have in Los Angeles.
http://journalism.berkeley.edu/projects/border/elpasocolonia... http://www.sos.state.tx.us/border/colonias/faqs.shtml
And two New York Times articles from July:
http://www.nytimes.com/2011/07/08/us/08ttconditions.html http://www.nytimes.com/2011/07/10/us/10tthealth.html
And
Many homes, built without regard for indoor bathrooms or plumbing, are treated as substandard or dilapidated by housing inspectors. These homes cannot pass inspection to qualify for hook up to water lines
It is not that these services are not available because the government is unable to provide them. In these cases, the government will provide these services in areas zoned for residential use, and where buildings have passed inspection. Ironically, the fact that these people do not have access to certain infrastructure is a sign of how modernized the US is...not only do we provide the infrastructure, we also have a system in place to ensure its safety and quality.
Nothing like India, though, where you don't have to go out of your way to find really exceptional poverty and deprivation.
I think you are confusing the availability of infrastructure with the ability to pay for it. Anywhere in the US that is zoned for residential use will have access to clean water, sewage, trash pickup, mail, broadcast television, landline phone, police, fire, etc. So this garage, if it is in a residential area, and is up to code, will have access to these services, assuming the owners or occupants are willing and able to pay for it. I could go live in the garage at the Playboy Mansion, and I wouldn't have running water or heat their either. That says more about my personal living conditions than the infrastructure the government provides.
As I tried to say above, I agree that it's a denial of reality to equate India with the U.S. along the "poor infrastructure" axis -- based on some particularly bad examples. I believe we're in agreement about that.
Please, just stop. You have no clue. I've lived most of my life in poor parts of the US. Now I live in a posh area of Pune and jog through slums fairly regularly. There is no comparison.
Just one stat for comparison. In the US, 70% of poor people own a car, and 25% own two cars. In India, 1.5% (as of 2006, it's probably more like 2-3% now) of all people have a car, and marginally more own a scooter.
http://www.census.gov/prod/2008pubs/h150-07.pdf
http://en.wikipedia.org/wiki/List_of_countries_by_vehicles_p...
The 5'th percentile in the US is richer than the 95'th percentile of India.
http://economix.blogs.nytimes.com/2011/01/31/the-haves-and-t...
In India (maybe every developing country), as you mentioned, poverty is lack of stuff. You literally don't have enough to eat.
In US (maybe every developed country), poverty is the lack of HOPE.
Its very very weird. I cannot understand why some "poor" person in USA feels poor when they get to eat, have shelter, drive a car, get to rant at their Congressman/woman etc.
Have you ever seen a desperately thin homeless person in the US?
There is no doubt India will become one of the richest economies, but right now we have so many problems we must fix. This headline gives the illusion that everything is just about perfect.
I dont think any country at any time was "perfect" and I dont think the headline is conveying that in any form
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nomin...
The culture and workings of the society, the low benchmarks for satisfaction and happiness is what keeps them happy.
The huge number of festivities also plays a part. :)
Yeah, no. The HPI is not a measure of the happiness of a nation, it's a measure of self-reported happiness per unit of "imposition on nature." And according to that index, we should all strive to be like the Dominican Republic, Vietnam, Columbia, and Cuba. No thanks.
GDP does'nt take any of that into account.
I'm also not convinced self-reported happiness is accurate across cultures. How do you control for cultural variations in the question "are you happy?" Diverse cultures have deep differences of understanding when approaching that question.
What's subjective to you is pretty objective to me - the health impact of unhappiness, for example, will reflect in healthcare costs. Which btw makes up 15% of US GDP. Now is that even real GDP or just a manufactured problem - with doctors and lawers and insurance guys all making money off of health problems of consumers.
See this - http://en.wikipedia.org/wiki/File:International_Comparison_-...
For the same baseline level of internal well-being, people will respond to the question "how happy are you?" differently depending on their culture. Do you understand how this presents a problem when measuring happiness across cultures? That is why I refer to it as subjective. Cultures change over time, so a change in the HPI might simply be a reflection of that.
That being said, I do not believe that just because a measure is subjective, it is useless. Of course it's useful. It's just important to understand what exactly you're measuring.
So taking into account cultural variations is meaningless when what I'm interested in measuring is the end result.
See the distribution of worldwide obesity here - http://wiki.medpedia.com/Image:World_map_of_Male_Obesity,_20...
and
http://www.healthyfellow.com/241/weight-loss-news
Probabaly from driving cars and watching too much tv and computers.
http://articles.timesofindia.indiatimes.com/2010-10-28/man-w...
Should a woman marry her rapist?
KALPANA SHARMA, Oct 28, 2010, 12.00am IST
When a rapist offers to marry the victim, one would think it's the perfect solution. But isn't this victimization of the victim all over again?