New Delhi: While the Indian stock market has crashed because of the Narendra Modi government’s benumbing incompetence and stupidity, China has emerged once again in a class of its own. The French president had barely left China hoping for gainful synergy with the glowing Chinese economy than the British prime minister made a beeline desperate for Chinese assurance in dire times of Brexit. Despite profound reservations about the Belt and Road Initiative (that France and Britain also share), Germany will be next in course once it settles leadership issues. As manufacturing powerhouses respectively in Western Europe and East Asia, Germany and China are competitors. If they put their heads together and work, it could seriously shake some plate tectonics.

The German economic recovery after World War II is well-known. It’s called Wirtschaftswunder. The recovery itself should not be surprising. After Otto von Bismarck united Germany and made it a nineteenth century Great Power in a space of merely two decades (which should count as a record of sorts), it competed with Britain, equalled and then surpassed the island nation as an industrial power. In doing so, it overcame a nearly fifty-year lag in the British pioneered Industrial Revolution. In addition to the industriousness of the German people (one of the hardest working people of the world to date and terribly thorough in whatever they undertake), Germany, or more accurately, West Germany, was gifted with world-class leaders in the era of its post-1945 rebirth, most distinguished of who was Konrad Adenauer. Germany’s accent on small and medium enterprises and steady and predictable economic policies (unlike under arch-tinkerer Narendra Modi) spurred on Wirtschaftswunder.

There is a further factor which spearheaded German growth. This is a factor shared with Japan but Japan has stagnated whereas Germany has not. Because of the infamy associated with Nazism and because of the German provocation of two world wars, first the occupying powers and later German leaders themselves discouraged an active role for Germany in geopolitics. German energies instead were redirected to economic growth and prosperity. In this, Germany never flagged while Japan has tailed off. If anyone could provide stiff competition to China, it would be Germany, and this is a contest worth watching in the coming decades.

The Chinese economic miracle is no less wonderful, however, although the pathways to it are substantially different from the high roads Germany took to industrial greatness. The origins of the Chinese miracle under Deng Xiaoping have been often discussed by this writer in this magazine but its comparability to America’s economic rise in the nineteenth century is rather striking and new to behold. The compelling quality about America’s rise is that it took place in relative quiet and isolation in the western hemisphere separated by a vast ocean from quarrelsome Europe. The American and Russian rise in the nineteenth century are often compared but there is really no basis for comparison other than that each of them had vast lands respectively to the west and east to expand. The American and Chinese rise in successive centuries is rather more comparable for the economic substance they commonly contain.

The Chinese economic rise started from the catastrophe of the Tiananmen Square troubles but it has charted a steady course since. At the centre of it all was Deng’s audacious genius who knew what China was capable of and went about arranging the world to meet its needs. China’s totalitarianism has probably made China’s runaway economic success possible but Russia’s disastrous economy makes a compelling counter-narrative as well. The remarkable thing is the peace and placidity with which China has grown commencing from the last decade of the Cold War all the way through to the present tensions in the Korean Peninsula and the South China Sea. As the manufactory of the world, China has most of the strings in its hands. It is extraordinary that Western Europe needs China more than perhaps China needs it. In their need, the French and the British have to smile and suffer while the Chinese drive hard bargains and extract geopolitical concessions. And there is India under Narendra Modi making one blunder after another in a race to self-destruction in a spectrum of fields ranging from geopolitics to geo-economics.

Editor’s Note: 1. After demonetization and an extortionate and messy GST, the economy has received a third shock in the form of a 10 percent tax on mutual funds and long-term capital gains. At this rate, Narendra Modi will kill the economy before he is done. This is a vampire government sucking your blood and mine with taxes, taxes and more taxes. For the immediate post-Modi government, its work is cut out to rescue the economy. This would only be possible with dramatic reduction and abolition of a variety of taxes, including the LTCG tax.

2. The Narendra Modi government suffers from an inferiority complex. It claims its healthcare programme to be the largest in the world with nothing to show. A test of a programme is its capacity to meet targets and to penetrate, in India’s conditions of abysmal poverty, the weakest sections of the population. India ranks poorly in planning and implementation. The scars of demonetization, for example, are still to heal. Largeness is not important. Governments cannot be in a Guinness contest. Programmes have to deliver, and the Modi government is distinctly infirm in delivery.

3. There is a story propagated by Narendra Modi that he twice applied to the Ramakrishna Mission to become a monk and that he was politely but firmly turned down both times. The Ramakrishna Mission’s gain has proved to be the nation’s loss.