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  • Aug 20, 2014
  • Updated: 6:25pm
BusinessEconomy

China's success in India's sacred space

India wants to beat China in trade and growth but the local market is offering a bigger variety of goods from the mainland that are cheaper

PUBLISHED : Wednesday, 21 November, 2012, 12:00am
UPDATED : Wednesday, 21 November, 2012, 2:34am

Indians right across the vast subcontinent and, indeed worldwide, last week celebrated Diwali, the festival of lights, Hinduism's biggest festival, with fervour, a blaze of lights and thunderous blasts of firecrackers.

But, perhaps unknown to most devotees of Lakshmi, goddess of wealth, and Ganesh, the elephant god revered as the remover of obstacles, this year had a special Chinese flavour.

That is because many of the fairy lights, sparklers, firecrackers and even images of the idols themselves were made in China.

China's participation in Diwali through its exports signals a triumph for international trade, particularly when Sino-Indian political relations are strained.

But Chinese success also points to corresponding Indian failure. It is not a simple matter that Chinese ingenuity and trading skills penetrated the sacred sphere in India, but also that Indian craftsmen, industrialists and traders had business snatched from their own backyard.

India's Prime Minister Manmohan Singh, up and coming leader Rahul Gandhi and planning chief Montek Singh Ahluwalia need to put their heads together and urgently look at India's economic shortcomings and to go beyond the conventional economic categories in trying to find remedies.

Visitors to Chandni Chowk, the main thoroughfare of Old Delhi - and five centuries ago regarded as the richest street in the world- as well as to other major shopping areas in New Delhi, could easily see that Chinese lights and fireworks had conquered. The Associated Chambers of Commerce and Industry of India even dubbed this as Chinese Diwali, estimating that Chinese sales had leapt by 45 per cent from last year.

But there were wider business lessons to be learned here.

Indian shopkeepers praised the Chinese exporters for their competitiveness on price. A string of 100 lights made in China was selling for between 40 rupees (HK$5) and 60 rupees, whereas the Indian version cost about 100 rupees. The Chinese also scored on innovation, casting the lights in shapes from fruit to stars.

What was more surprising was that Chinese manufacturers have also managed to penetrate the market for the production of the images of the gods.

Traditionally, these were made of clay by thousands of Indian craftsmen. But increasingly clay is being replaced by plastic and rubber icons, which have the advantage of being unbreakable.

China also produced Lakshmi lampshades, which can be used as lights and as images of the goddess.

Ganesh has always been recreated in a folksy way, including in a cricket-playing reincarnation, but this year careful devotees would have seen images of Lakshmi not only loaded with bling but with an inscrutable oriental face.

This is not just a quirky story about an Indian festival.

There are important economic and social issues at stake, along with the important question of India's battle to pull itself out of poverty and to emulate China as a potential economic superpower.

In terms of the more than damned lies called statistics, India is already winning and is chasing China hard. The OECD, the club of rich industrialised nations, recently pointed out that in terms of purchasing power parity, India has already overtaken Japan to become the third biggest economy in the world.

Such national and global aggregations, however, fail to measure the immense gaps between and within countries.

Per capita income in Japan, now displaced to the world's fourth-biggest economy, is about US$35,000 or 24th in the world in per capita terms; that of India is a mere US$3,600, languishing in 125th place.

The Indian figures mask the immense chasm between the rich and the poor. The same issue of the Hindustan Times newspaper that highlighted the Chinese success at Diwali also had a society page celebrating film stars attending a premiere, with many of the women wearing designer saris and weighed down with glittering jewellery.

The same society page also recorded Bollywood superstar Amitabh Bachchan giving a Diwali present of a new red BMW Mini Cooper S car, worth 2.4 million rupees or almost US$45,000 to his granddaughter Aaradhya. Aaradhya is just a year old.

Superficially, India and China share much in common, not least the appalling choking pollution, the glittering shopping malls and growing gaps between rich and poor. But India lags in myriad ways great and small. Growth has slowed significantly and was only 6.5 per cent in the fiscal year to March.

Becoming a slumdog millionaire is a chance in more than a million.

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