India and China are both growing; that's where the similarities end

China and India are in a struggle for a top rung on the ladder of world power, but their approaches to the state and to power could not be more different.

I met with a Chinese friend who was visiting India on business two days after last month's terrorist attack on Mumbai. He was shocked as much by the transparent and competitive minute-by-minute reporting of the attack by India's dozens of news channels as by the ineffectual response of the government. He had seen a middle-class housewife on national television tell a reporter that the Indian commandos delayed in engaging the terrorists because they were too busy guarding political big shots. He asked how the woman could get away with such a statement.

CHINA and India are in a struggle for a top rung on the ladder of world power, but their approaches to the state and to power could not be more different.

Two days after last month's terrorist attack on Mumbai, I met with a Chinese friend who was visiting India on business. He was shocked as much by the transparent and competitive minute-by-minute reporting of the attack by India's dozens of news channels as by the ineffectual response of the government. He had seen a middle class housewife on national television tell a reporter that the Indian commandos delayed in engaging the terrorists because they were too busy guarding political big shots. He asked how the woman could get away with such a statement.

CHINA and India are in a struggle for a top rung on the ladder of world power, but their approaches to the state and to power could not be more different.

Speaking of the global financial crisis, Sonia Gandhi recently applauded Indira Gandhi's bank nationalization of 1969, saying that it had given India 'stability and resilience'. Like the Bourbons of France our political class neither learns nor forgets anything. I don't think Sonia Gandhi realizes quite what she was saying. India's bank nationalization delivered neither growth nor equity. Any public sector bank manager will tell you how loans were diverted to friends of politicians rather than to commercially deserving farmers. Bad debts of banks rose alarmingly in the 1980s and moral hazards persist.

One of my earliest memories is of a visit to a lending library. We lived in Shimla and I had discovered a circulating library near our home. Since my mother would not let me borrow a comic, I picked up my first copy of Enid Blyton. When we got home, my overbearing uncle thundered: “How can you let the boy read this trash!” Blyton may not be Shakespeare but with her I began my love affair with reading. When my kids were of that age they too found a lending library at Kemps Corner in Mumbai. When our family meets nowadays, we don't ask, 'how are you feeling?' We ask, 'and what are you reading these days?'

Nothing causes as much anxiety in a family as when someone falls sick. 65% of India's poor get into debt and 1% fall below the poverty line each year because of illness, according to NSSO 2004. The answer, of course, is health insurance, but only 6% of India's workers have it. Free public hospitals are not an option as two out of five doctors are absent, and there is a 50% chance of receiving the wrong treatment, according Jishnu Das and Jeffrey Hammer's study. This tragic state of affairs is, however, set to change dramatically with Rashtriya Swasthya Bima Yojana (RSBY), a visionary national health insurance scheme, which provides Rs 30,000 'in patient' health benefits at a premium of Rs 600, which the government pays if you are poor.

The persistent attacks of terror on Indian cities by Islamist fundamentalists and on Christians in Orissa by Hindu fundamentalists have spread fear, re-opened old wounds, and polarized us. India's economic rise is threatened as much by religious fanatics as by the global financial meltdown. This raises an insistent question: Will our 21st century be the story of an India turning middle class or will it get derailed by religious wars?

When you teach people for two generations not to respect the property of others you are bound to have a tragedy. Singur is 50 km northwest of Kolkata where Ratan Tata made the surprising decision to set up a factory for the world's cheapest car, the Nano. Bengal's image may have improved but it still has a poor work culture. But its chief minister Buddhadeb Bhattacharjee is a charming man. He sees himself as the Deng of India, and he persuaded Tatas with an attractive plot of 1000 acres.