Edward Luce's "In Spite of the Gods"

I have just finished reading "In Spite of the Gods: The Rise of Modern India" by Edward Luce.  Luce is currently the Washington Bureau Chief for the Financial Times, but is the former South Asia bureau chief, and is married to an Indian woman.  He comes at the story of India from an almost completely economic point of view, which is what I was looking for. The economic growth of India is a revolution.  Since 1991, when economic reforms were enacted, India has turned itself from an economic backwater to a center of global technology.  But, it is not an entirely rosy story.

India is advancing rapidly - and this book, at five years old (published in 2006), at times feels as though it is becoming overtaken by events.  For example, time has shown it to be overly rosy about financial deregulation.  Luce writes that "India has nothing to fear from further financial deregulation".  However, when the crisis in 2008 hit, India's removal from global financial markets have allowed its growth to continue with only a small interruption.  He also shows more optimism about the India-Pakistan peace process than was warranted.  He hoped that Prime Minister Manmohan Singh's overtures of peace with then President Musharraf would yield an agreement.  Instead, the Mumbai attack in 2008 closed that process down.  Only now is it restarting.

He is optimistic about India over the long term.  First, India is beginning to enter the time of its 'Demographic Dividend'.  This means that it will have more people of working age - between 18 and 65 - than dependents; a young population, but with a declining birth rate.  The East Asian Tigers used such a dividend to grow very fast.  He also says that India's diversity and its democracy make it resilient.  He compares it to an 18-wheeler.  Not necessarily fast or efficient, but the loss of a couple of tires will not throw the vehicle into the ditch.

The biggest threats to India's continued growth and prosperity, according to Luce, are Hindu Nationalism and a complacent governing class.  Luce spends several chapters discussing the Bharatiya Janata Paty (BJP), its relationship with its militant wing, the Rashtriya Swayamsevak Sangh (RSS), and how it creates a toxic atmosphere for the Hindu-Muslim relationship.  I am not convinced that the BJP needs to be characterized as anything more than a conservative, religious party, like a Christian Democratic party.  But - both major parties do have certain factions that do not seem wholly rooted in democratic ideals.

The second threat, I think, is more pernicious.  There is a danger that the Indian governing class will determine that further growth and economic reform is not needed. Just because India has a middle class of between 200 and 300 million people, they will grow complacent.  Unfortunately, that will leave the country with between 700 and 800 million impoverished.  But, because of caste divides and urban-rural divides, many of the ruling elite look at the problems of the poor as separate.  Luce paraphrases the Bhagavad Gita as saying that in India the intentions are more important than the outcomes.  He goes further into saying that many Indians confuse a good argument with a responsible governing position.  In my experience with South Asians at conferences, this has been the case - they do tend to filibuster better than any South Carolina Senator.

Luce also has a lot to say about the environmental, energy, and population challenges that India faces.  I am planning to do some more research tomorrow, and will put up a blog post about those tomorrow.