RIC meeting

 The RIC meeting, drawn by Google Gemini:

More China is in a hurry

NBC reports
China's rising tech scene threatens U.S. brain drain as 'sea turtles' return home
Silicon Valley was "a little bit slow for us," said Shenzhen-based entrepreneur Jason Gui, one of millions of Chinese people who were educated in the U.S.

China is in a hurry

NPR audio

"Bob Wimmer is a scientist at the University of Kiel in Germany who built a radiation detector for Chang'e 4 {China's lunar lander on the far side of the moon}.  He says the speed at which the Chinese work is astonishing.

"European missions are extremely slow, the Americans are about twice as fast, and the Chinese are a factor of two to five faster than the Americans."

From the moment he got funding to the moment his experiment launched, was just over a year, which is nothing for a space mission.

"It is just incredibly intense."

---
We all have to speed up too, or else pay tribute to our new overlords. 

New Yorker: Making China Great Again

A long article but should be read.

Yan Xuetong is the dean of Tsinghua University’s Institute of Modern International Relations. At sixty-five, Yan is bouncy and trim, with short silver hair and a roaring laugh. When I arrived at his office one evening, he donned a black wool cap and coat, and we set off into the cold. Before I could ask a question, he said, “I think Trump is America’s Gorbachev.” In China, Mikhail Gorbachev is known as the leader who led an empire to collapse. “The United States will suffer,” he warned.

Over a dinner of dumplings, tofu, and stir-fried pork, Yan said that America’s strength must be measured partly by its ability to persuade: “American leadership has already dramatically declined in the past ten months. In 1991, when Bush, Sr., launched the war against Iraq, it got thirty-four countries to join the war effort. This time, if Trump launched a war against anyone, I doubt he would get support from even five countries. Even the U.S. Congress is trying to block his ability to start a nuclear war against North Korea.” For Chinese leaders, Yan said, “Trump is the biggest strategic opportunity.” I asked Yan how long he thought the opportunity would last. “As long as Trump stays in power,” he replied.

How far behind China is India?

Using the United Nations Human Development Index 2016 and associated data (available here), one can construct the following table, showing India's 2015 value and the years bracketing the period when China crossed that value.  So, for example, both China and India have young but  aging populations; India's median age of population in 2015 was 26.6 years; China had that value sometime between 1990-1995 (the data is given at five year intervals).

Human Development Index (HDI) is yearly, and so one can say that India's 2015 value of 0.624 was crossed by China sometime between 2003 and 2004.

One can see that India, per capita income-wise is about 10 years behind China, but in HDI is 13-14 years behind.  In some health and education indicators India is 25 years behind China.  By these measures, India is not getting increases in human welfare commensurate with its increasing income.

-->

Index	India 2015	When China
Human Development Index (HDI)	0.624	2003-2004
Demography-Median Age (years)	26.6	1990-1995
Education-Adult Literacy Rate (% ages 15 and older)	72.10%	before 1990
Education-Expected years of schooling (years)	11.7	2006-2007
Education-Mean years of schooling (years)	6.3	1999
Education-Population with at least some secondary education (% ages 25 and older)	48.7	1995-2000
Health-Infant Mortality rate (per 1000 live births)	37.9	1990-1995
Health-Life expectancy at birth (years)	68.3	before 1990
Health-Under-five mortality rate (per 1000 live births)	47.7	1990-1995
Gross Domestic Product per capita (2011 PPP $)	5730.1	2000-2005
Gross National Income per capita (2011 PPP $)	5663.5	2005-2006

A commenter asked for the trajectories, two are shown here:

Human Development Index 1990-2015 (light blue: China, dark: India)

Human Development Index 1990-2015: China and India

Gross National Income per capita (2011 PPP $) 1990-2015 (light blue: China, dark: India)

Gross National Income per capita (2011 PPP $)

The Paris Climate Deal

Getting all the countries in the world to agree to something like the Paris Climate Accord is quite remarkable a feat.  Part of the reason there are no legally binding actions in the accord is because they would never get past the US Republican-controlled Senate; and not having the second-largest emitter of CO2 be on board the accord would be a major failure.

All of the Republican POTUS candidates spit on the accord.  Americans who complain about the accord not being enough need first to tackle the opposition at home instead of pointing fingers at China and India.

Water use: top 10 countries in 2010

From an IMF publication (PDF):
The 'Agricultural Land Area' heading is wrong, it is the total land area of the country.  Noteworthy are that Pakistan is the most water-intensive (water used per unit of GDP) country, and that India's per capita water use is so much higher than China's. 

China-India comparison

In terms of size of economy in nominal dollar terms, India today is where China was in 2005. (I'm not sure I have it in constant dollars).   In terms of growth rate, China was clocking 10-11% growth rates around 2005, India is today at 7.5-7.8%.  In terms of trade, China's exports of goods and services in 2005 were 37% of GDP (World Bank http://data.worldbank.org/indicator/NE.EXP.GNFS.ZS/countries?page=1 ).  India's today (2013) is 25.2% of GDP.  Incidentally, China's today (2013) is 26.4% of GDP.   China's foreign exchange reserves reached a trillion dollars in October 2006.  India's today are around $350 billion.  China was running huge trade surpluses, India is running at a deficit.

China's growth around 2005 was very much export-led.  I'm not sure how to characterize India's growth.

In 2005, China's domestic credit to the private sector was 113% of GDP.  Today (2013) India's is 52% of GDP. ( http://data.worldbank.org/indicator/FS.AST.PRVT.GD.ZS )

Amitav Ghosh on the Opium Wars

From this review/interview:

Amitav Ghosh, the acclaimed 58-year-old Indian novelist, is describing his extraordinary Ibis trilogy which has just concluded with the publication of the equally stupendous Flood of Fire. A decade in the writing, this exciting, passionate and scathing account of the First Opium War deserves to stand as one of the outstanding achievements of 21st-century literature.

...
In Ghosh’s telling, English merchants’ expansionist policy of selling opium, grown in India by near-slave labour, and sold in China where there was a vast illegal market, did not simply mark the foundations of the British Empire. It signalled a new form of global trade and politics, laying the foundations of outsourcing, migrant populations and truly international foreign relations – all driven by advances in military technology and realpolitik.
...
“It’s strange that the world pays such little attention to the Opium Wars, but opium was perhaps the largest single trade of the 19th century. All the profits went to England. All the work was done by Indians. All the silver came from China which was consuming it. It was one of the most iniquitous things that has ever happened in the history of mankind.”

The Chinese rip-off of Pakistan?

Much is being made of the promised Chinese investment of $46 billion in Pakistan.

The plans envisage adding 10,400 megawatts of electricity at a cost of $15.5 billion by 2018. 

The China power deals with Pakistan are at $1.5 billion or so per 1000 MW of installed power.

In contrast, in Bangladesh,

"Reliance Power and BPDB today signed a MoU to develop four units of power plants to produce 3,000 MW of electricity with a cost of $3 billion," the company said in a statement. .....Adani Power will set up two coal-fired plants with a total capacity of 1,600 MW that will cost more than $1.5 billion.

The Indian companies are doing it in Bangladesh at $1 billion per 1000 MW.

This is consistent with Tata Power in Vietnam:

Long Phu 3 plant is also expected to cost roughly $2 billion, with a capacity of 2,000 MW.

Back to Pakistan:

The 1,320 megawatts coal-fired power plant, known as Port Qasim Power Project, near Karachi will be jointly carried out by Chinese Power Construction Corp with 51% and Qatar’s Al Mirqab Capital with 49% stakes in the project with a total cost of $2.1 billion.

The above is about $1.6 billion per 1000 MW, and this is without overhead one might think is contributing to the costs in other projects (e.g., setting up coal mining in Thar, or setting up railway capacity to transport coal from the port city Karachi to the interior of Punjab).

Same article, here's the Thar project, where mines will be set up to use coal relatively recently discovered in Thar:

The mining will cost $950 million while $1.1 billion will be required for power generation for the 660 megawatts coal-fired power project, he said.

$1.1B for 660MW works out to about $1.6B per 1000 MW.

It would seem to me that friendship with China is costing Pakistan 50% above the market rate for power plants. The friendship has to be indeed taller than mountains and deeper than seas for it to survive market forces.

I hesitate to call it the Chinese rip-off of Pakistan only because the Pakistanis have successfully extracted billions out of the US of A without giving anything substantial in return; and it may be in their nature to try to do the same with the Chinese.

PS: the cost in the US for a new coal power plant ranges from $3B to $6.6B per 1000 MW but I would expect costs in Pakistan to be more in line with Bangladesh and Vietnam.

Copenhagen Climate Talks: two points of view

Spiegel Online

How China and India Sabotaged the UN Climate Summit

What really went on at the UN climate conference in Copenhagen? Secret recordings obtained by SPIEGEL reveal how China and India prevented an agreement on tackling climate change at the crucial meeting. The powerless Europeans were forced to look on as the agreement failed.

Times of India:

How India saved China from isolation at Copenhagen

BEIJING: India foiled an "ambush China" strategy of western nations including the United States at the climate change talks in Copenhagen last December. This is why Chinese leaders now regard India as a crucial partner in the global arena, Jairam Ramesh, minister of state for environment said here on Sunday.

Head in the Sand

The Chinese government is taking the attitude that if you can't talk about a problem, then the problem won't exist any more.

The Asahi Shimbun reports that China has banned reporting on 18 subjects.

The banned subjects include: foreign criticism of China, in particular currency issues; the difficulties faced by university students in finding jobs after graduation, food safety and rising prices of cooking oil, problems with vaccines stored at the Ministry of Health, high medical fees; disparity of wealth; reform of the registration system separating urban dwellers from rural residents (Hukou); forecasts of appointments for Communist Party leaders; expansion of autonomy at universities; the collapse of school buildings in the 2008 Sichuan earthquake and delays in reconstruction; the beating death of a steel plant president in Jilin province; collusion between police and gangsters in Chongqing; rising real estate prices and the housing shortage; real estate developers trying to increase land prices.

"Most of the subjects that people are interested in have been banned. We don't know what to report on," said an official at a Chinese newspaper.

Country Trade Comparison - Pakistan, India, China

World Bank

Four measures, for the period 2006-2009:

1.
TTRI (MFN applied tariff) - All Goods
Trade Tariff Restrictiveness Index (MFN applied tariff) - All Goods -This indicator reflects the equivalent uniform tariff of a country tariff schedule that would maintain domestic import levels constant.

Lower value/rank closer to 1 means fewer tax & tariff barriers to imports.

Pakistan 12.2 (rank 103)
India 12  (rank 102)
China 5.33 (rank 63)

2.
MA-TTRI (applied tariff incl. prefs.) - All Goods
Market Access -Trade Tariff Restrictiveness Index (applied tariff incl. prefs.) - All Goods - This index reflects the equivalent uniform tariff of trading partners facing the exporter country, that would maintain the imports of the trading partners constant, including preferential tariffs.

Lower value/rank closer to 1 means fewer tax & tariff barriers to exports.

Pakistan 7.26 (rank 117)
India 3.47 (rank 70)
China 3.9 (rank 75)


3.
Ease of Doing Business - Rank
2010 Ease of Doing Business - Rank - This indicator represents a country’s overall business climate based on seven indicators, three of which are also reported in the WTI database: Starting a Business, Enforcing Contracts, and Closing a Business, (1 best -183 worst)

Pakistan rank 85
India rank 133
China rank 89

4.
LPI - Overall
LPI - Overall - This indicator reflects the overall perception of a countrys logistics based on over 1,000 responses to a survey of logistics performance. The overall LPI was aggregated as a weighted average of seven key areas of logistics performance (1 worst -5 best).

Pakistan 2.53 (rank 111)
India 3.12 (rank 47)
China 3.49 (rank 27)

----------

Surprisingly Pakistan is the easiest place to do business.  Either the World Bank is smoking something good, or else Pakistan's political instability and its reputation of being Terrorism Central is eroding its one major competitive advantage.

Also, Pakistan would do well to use its diplomatic capital trying to dismantle barriers to its exports rather than constantly harp on Jammu & Kashmir.