Gurgaon is a flashy new city that bills itself as a high technology hub, is the home to a slew of multinationals and has a vibrant upwardly mobile population. It is also a satellite to Delhi and feeds off the Indian capital much like Tianjin feeds off Beijing.
If you are lucky with traffic, the trip from Delhi to the Gurgaon offices of Huawei, the Chinese provider of telecommunications and IT solutions, can take as little as half an hour.
Huawei’s office is on the fourth floor of a shiny new commercial park. It is here that, in the middle of an interview with senior management, the lights go off.
"[Power cuts] happen here very frequently," said Ramdev Sharma, chief technology and marketing officer at Huawei Telecommunications (India). "I think four times a day."
The cuts are not a big problem for Huawei which, like any other technology company in India, has backup power. But they are an indication of how much further the country’s economy has to go before it can stand comparison to China.
In many superficial ways, India and China are indeed similar. They are the two most populous nations on the planet. Both have histories that dwarf almost any Western country. Even the capitals are similar. Both Delhi and Beijing are generally unfriendly to the pedestrian, crowded and plagued by nightmarish traffic.
But it is the differences that are most salient. China launched its economic reforms in 1978. India waited until 1991 and, for a decade afterwards, developed at the "Hindu rate of growth" of 5% or less .
Despite talk of India’s current growth, the country is still far behind China in many respects.
For example, China’s infrastructure is much more comprehensive. Per capita consumption of electricity in 2003 was 1,379 kilowatt hours to India’s 435 kwh.
In 2004, China had 499 mobile phone subscribers for every 1,000 people compared to 85 in India. Last year, China was adding 5.37 million new mobile phone subscribers per month to a pool of over 400 million while India was growing at a rate of 4.69 million from a base of about 80 million. Meanwhile, China had some 352 million fixed line telephones in 2006 to India’s 49 million in India. China also had double the number of internet users.
More significantly, Indian industry represented only 28% of GDP in 2005 compared to almost 50% in China. At the same time, India’s merchandise trade was also 28% of GDP. In China it was 64%.
But it is the size of each economy that best illustrates the disparities. China’s total GDP hit US$2.2 trillion in 2005 while India’s was US$785 billion. This is similar to China in the early 1990s and, to most economists, it is a fair representation of how things stand.
At the end of the 1980s "China had no private ownership, no legal framework for investment, no foreign direct investment whatsoever," said Jonathan Anderson, of chief Asian economist at UBS. China was in a recession and "things looked bad."
Change started from the bottom up. Guandong and Fujian provinces looked for ways to take advantage of Hong Kong money and economic reform just spread.
Similar things are happening in India, with states like Haryana coming up with creative ways to attract investment and re-invent themselves as industrial hubs.
Along the streets of Delhi (and Gurgaon) it is hard to escape the general feeling of optimism.
"Indian growth is purely spontaneous entrepreneurship," said Harpreet S. Puri, chief executive of Business Links, a company that links Indian and Chinese businesses. And, if China can offer India a picture of things to come, the future does indeed look rosy.
"There is major development taking place. Five years back if you wanted to drive to another city there would be roads with potholes. Today they have four-lane and six-lane highways," noted Pranay Dhabbai, COO of Haier India.
"It’s not as rapid as in China. It is not as visible because in China you wake up and suddenly you see a flyover… [But] India is a country that has a brilliant future for anyone to come and do business."
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