- 2018-11-12
New Engine of Global Growth: Three Indian Regions
Perhaps the biggest unanticipated consequence of the last millennium was the accidental collision of Columbus and the discovery of the American continent in 1492. The Genoese explorer originally tried to explore a sea passage to Asia-a passage that was not discovered by Portuguese explorer Vasco da Gama until 6 years later. Dagama did not cross the Atlantic Ocean westward, but sailed southward, then turned eastward, opening a sea passage from Europe to the fabled East India (Indies), thus realizing the dream of Columbus.
Da Gama’s historic breakthrough in 1498 was the beginning of the decline of Venice, the distribution center of Asian commodities at that time: since then, the lucrative Eurasian land Silk Road trade has increasingly given way to maritime trade via the Indian Ocean and the Atlantic Ocean. The land caravan post city, which became prosperous by the passenger flow brought by land trade, lost its status as a middleman. The British and Dutch East India companies squeezed out the Venetians and other middlemen to become the Amazon of their time... Unlike Amazon, they also made huge profits later!
More than 500 years later, at the beginning of the third millennium, the hopes contained in East India may once again be about to be realized.
China’s gross domestic product (GDP) is still growing at an alarming rate of more than 6% per year—because China is already the world’s second largest economy, "the starting point is not low", this rate is impressive and Can not be ignored-at the same time, there is also a growth story following China or emerging from the south of China. From now to 2050, the Three Indies region, which is basically but not entirely located in the countries surrounding the Indian Ocean, is most likely to become the main growth engine of the global economy.
This is almost a mechanical prediction: thanks to favorable demographic conditions and productivity growth, the rise of the region is stable. These two basic DNAs of economic growth will jointly promote the advancement of the three India regions.
What are the components of this new global growth engine? It has 3 flywheels: Indochina (also known as Indochina), modern East Indies and the Indian subcontinent. The Indochina Peninsula includes Vietnam, Laos, Cambodia, Thailand, Myanmar and Malaysia. The East Indies include the Indonesian archipelago and the Philippines, as well as East Timor and Brunei, as well as Sabah and Sarawak in Malaysia.
The Indian subcontinent includes India, Pakistan, Bangladesh, Sri Lanka, Maldives and Nepal. Singapore, located in the center of the region, can already claim to be the trading hub of the region.
These three regions have 2.4 billion people, almost one third of the global population: 270 million people in the Indochina Peninsula, 375 million people in the East Indies, and 1.75 billion people in the Indian subcontinent. It includes 7 of the 20 most populous countries in the world, including India, which will become the world's most populous country by 2025.
The inherent demographic advantage of the region is that almost all of the labor force is not only low-cost in terms of dollar hourly wages, but there are also a large number of semi-skilled and skilled workers. It also has more than half of the young people in the world. This explains why countries like Vietnam, Indonesia, and Bangladesh have won the latest round in the “Great Race” for the settlement of new factories. The "Made in India" initiative put forward by Indian Prime Minister Narendra Modi has put India on the list of popular manufacturing bases.
The Observatory of Economic Complexity at the Massachusetts Institute of Technology recently proposed an economic theory that seeks to explain the mystery of economic growth. Their "The Atlas of Economic Complexity" (The Atlas of Economic Complexity) clearly marked the Indian Ocean Basin as the region most likely to grow the fastest in the foreseeable future. Supporting and leading this forecast is India, which is expected to have an average annual GDP growth rate of 7% for the ten years ending in 2020.
The prediction is confirmed by The Conference Board, a corporate think tank: They also view the Indian Ocean Basin as the region that may record the highest productivity growth in the next 10 years.
The Chinese, known for their ability to learn from history, recognized these predictions and restarted the ancient concept of the land and sea Silk Road connecting eastern Asia and Europe. This initiative involves large-scale investment in transportation infrastructure in the Eurasian "Silk Road Economic Belt" and the Indian Ocean "Maritime Silk Road".
3. There are many other business advantages in India. Many countries in this region are proficient in using English, the common language of business all over the world, and the legal systems of many countries are derived from English law. There are many very entrepreneurial ethnic groups: Hadhrami, Ismaili, Gujaratis and overseas Chinese.
The region will use solar and wind energy resources to greatly benefit from the upcoming renewable energy revolution. At the same time, it will also explore the second stage of this revolution: the use of renewable energy for seawater desalination.
In due course, other countries adjacent to the region-especially several countries in East Africa, Australia, and possibly even the Middle East countries in the post-oil era-will be captured by the gravity of this new engine. Indeed, some countries such as Kenya and Ethiopia have already felt its gravity.
In 1498, when Vasco Da Gama first arrived at the Asian port, Calicut, India, he was surprised to find that he was in the busiest trading port on earth. Since then, the oceanic center of global economic gravity has first turned to the Atlantic Ocean, and now it is gradually turning to the Pacific Ocean. By 2050, the Indian Ocean Basin centered on the Three Indias region is likely to have begun to reproduce its past commercial glory.