This post that I'm writing today is about a book called CHINDIA How China and India Are Revolutionizing Global Business. When I saw this book at Barnes and Noble, with the trusty gift card that I had at the time, I realized here is a topic that I know absolutely nothing about. After reading the book, I have learned a lot, and it was more than just worth my time and money. Author Pete Engardio did more than just a good job. After reading the entire book, I have no idea if Mr. Engardio is a Democrat or Republican. I have to admit, I like that because his lack of a bias towards one or the other amounted to an excellent read. In fact, CHINDIA is light on opinions, but is overwhelming with facts. Mr. Engardio tells us how it is, and yes, from time to time he will make predictions.
So why China and India? Why wasn't this book called Frermany or Argentazil? It's because China and India compose roughly one third of the world's population, even though combined they compose less than ten percent of the total land area of the globe. Japan has made some great breakthroughs in their economy, however Japan's population isn't large enough to pack as much of a punch as China and India. You might have heard the saying "It's not the size of the dog in the fight, but the fight in the dog." Maybe that's not entirely true. China and India are like two siblings, both with their own strengths to be complementary to the other. Also, as two siblings, they resemble each other in many areas. China has the hardware, India has the software. China has all the resources that they need to trade products all around the world (which creates a large deficit here in the US) and India has some of the brightest minds on Planet Earth. If you have never seen a single item that you have bought that said MADE IN CHINA, I worry about you. Likewise, India has a college called the IIT (Indian Institutes of Technology), and it's possibly harder to get into than vet school. The IIT breeds the greatest minds that you can ask for. Also, India's technology services make it truly shine as a country. So, the way that I look at it is India has the brains and China has the brawn.
One issue that came up was a question of morality. China's labor costs are extremely low. When Chinese workers make a product and it is shipped here in the US, it still sells for less than products made here in the US! CHINDIA commented on the fact that Chinese vacuum cleaners have caused some employees of Hoover to lose their jobs. What is the best approach economically? What is the best approach morally? If we, as customers buy these cheaper Chinese vacuum cleaners, people at Hoover lose their jobs, and we validate the harsh conditions for Chinese workers. But, if we as customers boycott them then we are limiting global trade, and that should be done at a bare minimum. My feelings are that we should buy these Chinese products, but at the same time we should be aware of the fact that more than half a billion Chinese (that's more people than here in the US) live on less than two dollars a day. Also, simultaneously we should be willing to hire former employees of Hoover to work in another job.
Mr. Engardio does also comment on social issues. China's healthcare system is horrid, and SARS certainly did not help. Also, you've possibly heard of China's one child policy. Married couples can have only one child, and eventually that will increase the retiree/worker ratio which will be another difficulty for China. In India, kiosks are king. Kiosks is how business is going to flourish in India. Also, India's population is much younger than China's. One unfortunate similarity between India and China is their overwhelmingly poor standards of pollution control. For more information you can check out http://www.time.com/time/specials/2007/0,28757,1661031,00.html
In the times of slavery here in the United States, cotton was king. Now, in China, coal is king.
After it's all said and done, Mr. Engardio predicts a winner in this battle between China and India. He predicts that India will win. With its youthful population, he thinks that India will become the ultimate force to be reckoned with.
This book helped me to be familiar with a subject I knew practically nothing about previously. The main theme is this. We, as people of other countries besides China and India, cannot ignore those two. The two combined will have colossal influence for decades to come on the global economy, and businesses must accept that, or even better, use it to their advantage.
