The economic wisdom of the East

Prime Minister Narendra Modi’s visit to China, Hong Kong, South Korea and Mongolia is of strategic importance. The Chinese question is much too complicated to write in a column. With the agreement to have access to the port city of Gwadar in Pakistan, in a geographic sense the encirclement of India is complete.

Born as I was in the foothills of the Salt Range, in the Punjab province of Pakistan, it becomes difficult to convey the importance of this area — undivided India’s first line of defence.

This issue will be discussed in the times to come, we hope and expect, on a non-partisan basis given its critical nature. But the argument given by New Delhi experts that South Korea’s interests in India only started from the 1990s’ liberalisation phase is factually incorrect.

In a real sense, the South Koreans adopted the Japanese MITI (Ministry of Internal Trade and Industry) model of strategic planning. This model is essentially based on close cooperation between industry and government in manufacturing and trade policies.

South Korea’s historical inspiration comes from the atrocities of the Japanese occupation; it wants to outdo the Japanese model on its own terms.

In the late 1980s, an emissary was sent to the then Prime Minister Rajiv Gandhi. He argued that going by South Korean strategic analysis the decade of the 1990s would belong to India and they would like a team to come and touch base. I was sent with the then Industries Secretary Otima Bordia.

I asked the then governor of the central bank how they factored in comparative advantage in their industrial and planning strategy. He said, “Forget comparative advantage. We decide what to do and then do it well.”

South Korea, it would appear, was not as persuaded by the World Bank as it was by Mahalanobis, except that the accent was on export promotion rather than import substitution!

Hak Chung Su, the then Secretary of South Korea’s powerful Economic Planning Board, became a friend and invited me to the Asian Development Bank when he was its Vice-President, to reflect on India’s successes in the late 1980s.

I quoted my South Korean story in an invited piece in the ADB’s journal and it was made famous by Robert Wade in his well-known paper in Foreign Affairs on the East Asian miracle.

The South Korean connection is, therefore, three decades old and we should look forward with some expectation to its revival, thanks to the high level visit.

Mongolia is again at one of those crucibles which can be of great significance. In an official visit to this agonisingly beautiful country, I was intrigued by the fact that a number of Mongolians bore my surname, ‘Alagh’. It turns out that it is a Mongolian name. Chenghez’s nephew Bodi Ali Khan who ruled for four decades was Bodi Khan Alagh. The word ‘Alagh’ means bravery in Mongolian! As we get pressed on our borders it is important to see ourselves as a part of a larger adjoining world. As the crow flies, Kunming — the capital and largest city in Yunnan Province, Southwest China — is only an hour’s flight from Arunachal Pradesh. The tribals there are the same as on our side and a little probing shows how well they are informed of what is going on across the border.

Buddhism is popular with the youth; religion is not suppressed any more, but is not really kosher with the establishment. They are vegetarian and that variant of Chinese food uses a lot of red chillies -- a boon for Saurashtra, from where a lot of them come. One day we will have the vision to see the Brahmaputra to the Mekong as concentric circles of influence.

Until then, it is good to go there in peace and friendship. ‘The Hindi’ as we are called in West Asia can be loved, provided he leaves his conceit at home.

The writer is Chancellor, Central University of Gujarat and a former Union minister

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