This weekend, as India’s political class roils in rhetoric at political rallies, 376 members of the Communist Party of China’s Central Committee closeted in a hotel in Beijing will mull the next wave of gaige kaifang or very simply reforms. President Xi Jingping articulated the quest rather unambiguously when he took charge as the need to “push forward the great cause of socialism with Chinese characteristics, and strive to achieve the Chinese dream of great rejuvenation of the Chinese nation”. The invocation of hallowed memories of a bygone era—of the days of the ming-huang or the brilliant monarch—and the spirit of the ultimate game changer Deng Xiaoping is simply reflective of a new politico-economic model—of national ambitions built on individual aspirations.
It is not without reason that the Chinese people have billed this weekend to be as significant as that of December 1978. The pundits believe that China is at the cusp of a great opportunity and a possible political disaster. China is caught in a bind in its export-led economic model and political model. The Chinese leadership views it differently as an opportunity to retrieve its global position prior to the 19th century. And instead of wallowing about the chasm between aspiration and reality, the Chinese leadership of Xi Jingping and Li Keqiang have chosen to deploy the legendary idea of mozhe shitou guo he or crossing the river by feeling the stones. On the table for discussion are reforms in administration, land, banking, interest rates, state enterprises and of course the much-maligned and controversial hukou or internal migration policy. The Chinese leadership is wedded to the great Chinese experiment of a socialist market economy even as it preaches the permanent revolution.
To get a sense of the occasion and the potential magnitude, one must travel back in history. Thirty-five years ago, at a similar plenary in December 1978, Deng Xiaoping liberated China from the ghetto of ideology. As he famously said then “poverty is not socialism”. He propelled the idea of four modernisations and dismantled the ghettos of ideology and pursued a more open system to enable China to secure income and geopolitical security.
Since then, GDP growth has averaged 10 per cent a year, lifting over 500 million people out of poverty. Interestingly, China focused first on agriculture as the first step in Deng’s formula of modernisation. And although a decade behind India’s Green Revolution, the Chinese liberated agriculture from Communism by introducing the family responsibility system which was really a euphemism for privatising dividends of growth and invested in research and technology to achieve yields three times that of India. It then focused on building manufacturing competitiveness by opening up foreign direct investment to induct technology and skills competency. Yes, it built trillion-dollar reserves through exports and is the world’s factory. But more important is the qualitative migration up the value chain. For instance: from an importer of arms, China is among the world’s top exporters of arms.
Nothing though quite tells the story as the transformation on the ground. In 1978, China had a per capita income of around $210 while India’s per capita income was around $190. In 2012, with a population of 1.3 billion, China is the world’s second largest economy with a $8.5-trillion GDP and a per capita income of around $6,000. Deng taught well. He said: “Economic planning is not tantamount to socialism, because economic planning is also practiced in capitalist countries; the market economy is not tantamount to capitalism because a socialist country can also have a market economy.” Despite the moniker of “a Communist nation”, he made it kosher for the state to enrich China and the Chinese to aspire enrichment. Unsurprisingly, Harvard professor Erza F Vogel, who has authored the authoritative biography of Deng Xiaoping (1904-1997), believes no other leader in the 20th century did more to improve the lives of more people.
The story of China’s transformation is often derided by critics for the lack of political freedom in China—particularly by politicians in India. It is true that individual liberty is pretty much a phrase for the lexicon in China. But it is also a fact that China leads India on every human development indicator. Doubtless, China is no democracy. But what does it say about a democracy like India that lags China on every human development indicator —from malnutrition to literacy to mean years of schooling.
It is often argued that decision-making in an autocracy is easier than it is in a democracy. The argument is seductive. Ease or risk, however, is relative to the context. Consider the risks Deng Xiaoping took. He could easily have been ousted or indeed outmanoeuvred just as he had outwitted Hua Guofeng. Mysterious deaths and air crashes are part of folklore in autocracies. The saga of Defence Minister Lin Biao who tried to stage a coup against Mao—and who was found killed in an air crash in Mongolia—was not from a too-distant past. China could also have splintered as the Soviet Union into 15 countries after glasnost. That it did not fragment and prospered is a testimony to Deng and to the Chinese leadership that followed him. More importantly to the idea that economic growth delivers political stability and sustains power. It is a lesson the Indian political class struggles to comprehend.
Shankkar Aiyar is the author of Accidental India: A History of the Nation’s Passage through Crisis and Change
shankkar.aiyar@gmail.com