Why India didn't grow as fast as other Asian countries

The ‘what ifs’ of Indian development are many and varied. Embarking on a kind of time travel, some observers will point out that India had a per capita income comparable to Korea’s, say, some six decades ago, and to China’s before Deng Xiaoping began his bold reforms in the late 1970s.

- RAHUL JACOB

In A Sixth of Humanity, a book by Devesh Kapur and Arvind Subramanian, the authors posit this development paradox in a poignant and perceptive way: “Every successful case of growth surge and success in the post war period in Asia has been associated with dramatic surges (about 20% or more) in clothing and footwear exports.” Korea, for example, saw annualized growth rates of 30% in apparel and 70% for leather and footwear in the two decades after 1962, its year of economic takeoff. The comparable figures for India after 1980 are 12.7% annualized growth in apparel and a relatively measly 5.4% in leather and footwear.

The whimsy of ‘what if-ery’ often overlooks that both these East Asian countries had achieved much more in education and health, as well as relative gender equity, which boosted their world-beating growth. In addition to being blessed with a government supportive of small business, China also had a more entrepreneurial diaspora, heading firms in Taiwan and Hong Kong, which had long been superlative exporters.