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© 2012 Sanjeev Sabhlok's revolutionary blog
[Note: I wrote a longish post but with an accidental stroke, without saving it on WordPress, lost it! I'm not going to re-type it. (It is horribly frustrating, for a person with RSI and eye strain, like me, to lose my typed work!)]
Basically, all I want to note that in 12 out of the past 20 centuries, India was the RICHEST region in the world (there were no "countries" then). In the remaining 8 centuries, it was the world's 2nd richest region. Only in the 19th and 20th centuries – and now – has India not been in the top two nations in the world.
See
b) List of regions by past GDP (PPP)
Source: Angus Maddison's pathbreaking 2007 book.
Spreadsheet (from http://www.visualizingeconomics.com/cool-data/): vertical-file_02-2010 (XLS)
I note that these estimates might not be 100% robust but in my view, at the level of aggregation we are talking about here, they are VERY CLOSE to the truth.
CONCLUSION
The rules of the game changed between 1400 and 1750. Just like big companies that do not change with the times, die, India almost entirely lost its capacity to innovate by around 1750. Others, earlier far behind, rushed ahead. Every Tom Dick and Harry, including Japan, South Korea, Hong Kong, Singapore, Taiwan went ahead.
India continued to lives in its dreamworld, as confused as Islamic cultures are about their precipitous downfall. Tragically, till today, most Indians REFUSE to recognise that the rules have changed long ago. The competition is no longer the same. It is 10 times tougher.
India can NEVER become No.1 in the world again till Indians realise that they have to play with the new rules.
That means, among other things, discarding caste, stopping the constant religious babble that destroys peace and harms relationships, and the economy. That means building systems that are incentive-compatible.
That India should be doing AT LEAST TEN TIMES better than today is obvious. But achieving that requires a significant change in policies and governance – which have to be radically different to what we have had over the past 60 years.
Unfortunately, none of the existing political parties in India have the remotest clue how to get this to happen.
And so, once again, if you are serious about a very prosperous and successful India, read BFN; join FTI. There is NO other policy known to mankind that can help India achieve its potential; or rather, its natural right.
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Sad that you lost the original longish post. Would have loved to read your analysis in-depth.
Sad that you lost the original longish post. Would have loved to read your analysis in-depth.
The region of India had high GDP as a percentage of total world GDP in past because the population of the region reflected the output in those times. Since industrial revolution, productivity of each individual went up by orders of magnitude, in the west, the sparsely populated place of the world.
With the advent of these new technologies the production did not directly depend on population size. India was absent in this important development.
Thats why per capita GDP is a better representation of a countries economic health. India even today lags in technology adaptation which is going to hamstring it from leapfrogging to a much higher productivity, which ultimately leads to wealth creation.
The region of India had high GDP as a percentage of total world GDP in past because the population of the region reflected the output in those times. Since industrial revolution, productivity of each individual went up by orders of magnitude, in the west, the sparsely populated place of the world.
With the advent of these new technologies the production did not directly depend on population size. India was absent in this important development.
Thats why per capita GDP is a better representation of a countries economic health. India even today lags in technology adaptation which is going to hamstring it from leapfrogging to a much higher productivity, which ultimately leads to wealth creation.
Thanks Raj
That’s a valid point. Indeed, the rules of the game have changed. I’ll shortly put out a broad perspective on this issue which I call the obstacle theory of development. The real purpose of development (and government policy) should be to remove obstacles to reaching the technical frontier.
Theoretically nothing stops India from recovering its erstwhile status. Practically, there are hundreds of issues.
Regards
Sanjeev
Thanks Raj
That’s a valid point. Indeed, the rules of the game have changed. I’ll shortly put out a broad perspective on this issue which I call the obstacle theory of development. The real purpose of development (and government policy) should be to remove obstacles to reaching the technical frontier.
Theoretically nothing stops India from recovering its erstwhile status. Practically, there are hundreds of issues.
Regards
Sanjeev
India is run by politicians and businessmen who run it by their own rules.
Until 1990 India was closed economy, only after government decide to open our economy opened for outside world.
So nothing will happen because the politicians are not doing anything.
India will NEVER become a superpower or a developed state.