DANCING ELEPHANT MENACING DRAGON- A TALE OF TWO ASIAN GIANTS

One day in 2001, a report from Jim O’ Neill, an analyst with Goldman Sachs, New York, made the world sit up and take notice. The content of the report that O’ Neill wrote were to make significant impact on the World opinion in the years to come, with the perception that most people in the developed countries had of countries, that were mentioned in the report collectively called BRIC (Brazil, Russia, India and China, with South Africa added later, the acronym became BRICS), drastically changed and suddenly two of the Asian Giants mentioned in the report viz. India and China became sensations in the developed countries with analysts from leading Financial Institutions falling over each other to catch a slice of the pie. Traditionally both the countries have very strong historical and cultural roots that go back 5000 years and more and some shared traditions which lay emphasis on family ties and respect for elders. The question that is being asked everywhere across the world is that whether eventually these two countries will come to command the pole position in the world economy or fall by wayside and become “fallen angels” of BRICS. Four Hundred Years ago, these two countries together accounted for nearly 50% of the world’s GDP. Today China’s GDP is four times that of India. As is often the refrain amongst the high and mighty of the financial world that “ the Dragon will fly over the Elephant “ there are pertinent issues that need to be addressed before the unraveling of the growth story related to these two countries. There is already a disturbing trend that is being noticed in the economies of these two giants, the inflated and over hyped expectations of the investors, the multifarious agencies singing paeans of glory and the people of these two countries together are making it increasingly difficult for the economies to grow at the scorching pace that they maintained for almost two decades.