Reflections

I’ve been reflecting a little and have some observations about the differences between China and India as they continue to grow economically.

Both of these countries have seen an unprecedented transformation from mostly poor and agriculturally based economies to a new hotbed of economic growth and social change.

Hundreds of millions have been lifted out of poverty, yet hundreds of millions still remain in deep poverty. Seventy percent of India’s population lives in villages like the Kavis village I visited, where there is a lack of electricity, running water or access to health care.

Both of these countries are going to continue to rise. Even if India is slow to modernize its infrastructure it will plod along like a supertanker and still make progress – it just won’t grow as quickly. I mentioned earlier that India is a country of contrasts – it’s also a country of contradictions. While the image of India’s college system is turning out high numbers of outstanding engineers, the primary school system is not functioning as it needs to. Only 15 percent of India’s students even reach high school, and only 7 percent graduate.

India is expected to overtake China as the world’s most populous country in 2030, with 1.45 billion people. Today, half of India’s 1.1 billion people are under age twenty-five. India’s population challenge is to create enough jobs for those of working age today because if it doesn’t educate its youth and create jobs for a fast-growing population of workers, it will never have the ability to break the cycle of having large masses of people in poverty.

China also is facing an issue of the disparity and widening gap between the poor and wealthy. This will become a more serious social challenge as the booming urban areas outdistance the rural areas.

In my interactions with the Indian people I sense a deep sense of pride – pride in their work ethic and culture, but also pride in knowing that their country has catapulted to a top world economic power that the United States and others are paying attention to. Many Indians educated in the United States used to stay there for high-paying jobs and bright futures. But now they are eagerly returning home in greater numbers, knowing they can enjoy a good lifestyle and remain connected with their families.

Of course, years ago the Chinese government was worried that if it let its citizens leave the country they might not come back, but this is no longer the case. Many younger Chinese educated outside of the mainland are eager to return, are optimistic about the future, and intend to take care of their parents and grandparents.

In the end it’s not a question of China or India, but as someone told me it will be China “plus” India. It’s just a question of how each of these countries addresses some immediate challenges that will determine their long-term success.

The Blue City

Last night I took a midnight overnight train from Jaipur to Jodhpur, which is about a six-hour train ride west towards Pakistan. The train was an hour late arriving (very common here) so it actually left at 1am. I was glad I had reserved the sleeper compartment with air conditioning, which made it comfortable enough to get some sleep.

Trains are very popular modes of transportation in India and the general admission tickets with no reserved seats are popular because it’s so cheap – maybe a dollar or two for a similar trip. I watched another train leave at midnight and the general admission cars were packed 4 people to a seat, people sitting on the floors, people standing in the aisles around the people sitting on the floors, the luggage compartment was packed full with people on all three shelf levels and of course there was the usual large number of folks hanging onto the exterior railings as the train started off.

My first stop Jodhpur was Meherangarh Fort, an immense fort that looks like as if it is growing right out of the high ridge it sits on. It is still run by the maharaja of Jodhpur.
http://www.reisebilder.ch/indien/jodhpurfort_e.htm

The view from the fort overlooks the city, which is largely made of cube shaped buildings painted blue. There are historical/cultural reasons for the blue color but it is apparently also thought to repel insects.
www.en.wikipedia.org/wiki/Jodhpur

Yesterday in Jaipur I visited three forts that are also built on ridges just outside the city (Amer Fort, Nahargarh Fort and Jaigarth Fort). But in the center of town I met a young entrepreneur and shopkeeper named Babbal. He is in his lower 30’s and part of the emerging middle-class in India, as he recently established a contract to provide bed sheeting for 37 stores of a New York retailer. Of course a large number of middle-class Indians are those from the fast-growing knowledge economy with a focus on a strong educational background.

The heat has been fairly intense and close to 100 degrees these past few days. The city of Jaipur actually only turns the water supply on for residents and businesses for a two-hour period in the morning and for one and half hours in the evening. I don’t think this is related to the heat this year, but is general practice. I also noticed several power outages during the daytime hours. Businesses and people with computers typically have backup batteries that kick in because this can happen frequently.

The Pink City

I could tell you that the key to driving in India is simply remembering to tap on the horn every 15 seconds and maintaining camel eyes (just looking straight ahead like you don’t see anyone else) because that’s what drivers here do. But it’s much more than that and you need to have nerves of steel.

The over 130-mile drive from Agra to Jaipur is not for the feint of heart and it was an interesting experience. It took me about 6 hours moving on a frequently congested narrow road, that included camels, herds of goats, tractors, buses, industrial trucks, bulls bathing in large mud holes on the road’s shoulder, motorcycles carrying up to 4 people, overloaded jeeps and vehicles carrying 25 passengers or more hanging off the sides and sitting on the roofs. The photo is one such diver we encountered on route.

After experiencing road transportation in India it is very evident why an economist told me there are three constraints to India’s continued growth: Infrastructure, infrastructure and infrastructure. It takes an inordinate amount of time to get from place to place in India, whether by road, rail or even air.

The government has built 3,355 miles of highways, with another 1,600 under construction and an additional 3,700 miles planned. The massive growth in domestic and international air travel is why dozens of new airports are being built or upgraded. All together India will spend about $150 billion infrastructure between 2005 and 2010. China invested more than that ($200 billion) in the year 2005 alone. Of course it is easier to get things done in a command control economy.

I hired someone for the drive to Jaipur but there was no way I could rest with the horns constantly beeping as we passed vehicles and obstacles by the slimmest of margins. Pushpendre and Sunil were brothers who took turns driving and only understood a few sentences of English – so we listened to music tapes as I snapped photos along the way.

I made one stop at Fateh Pur Sikri, which has interesting architecture and is the tomb of a Muslim Saint.
www.sscnet.ucla.edu/southasia/Culture/Archit/Fateh.html

Jaipur was painted pink to welcome the Prince of Wales in 1876. There are beautiful forts high on hilltops and the Rajasthani food is wonderful, especially for vegetarians. However, there’s also overcrowding and high unemployment in this city of 3 million.

I had dinner tonight at Chokhi Dhani, which means ‘special villlage’ and emphasizes Rajasthani food and entertainment like puppets, magic shows, acrobatic dancing. I went with Gopal Khanna’s (State of Minnesota CIO) brother Deepak. I sampled Pakoras (fried snack) and Chana Chor Garam (chick peas, chili pepper, lime, and salt). Deepak’s son is headed to the University of California Santa Barbara in a few weeks for graduate studies in electrical engineering. Another example, of a high-achieving Indian headed to the U.S. for higher education.

Last night I was received by the Mayor of Agra, who had heard of my India Center initiative at the U of M and wanted to acknowledge my efforts in broadening a Minnesota and India connection and collaboration.

Thanks for posting the comments to my travels !

The Other Side of India

Today was an amazing experience and I’m sure I will not adequately present a vivid enough account of what it was like.

My morning began by visiting with the poor and proud villagers of Kavis village just outside of Agra. The drive to get there took me past camels, donkeys or oxen pulling carts and small mud or straw huts along the fields used as silos to store harvested crops or cow dung, which is used for cooking. This was truly a very rural setting among those making between one to two dollars per day.

It was the first time that many of these villagers had seen an American and it was the first time one had come to their village. I was immediately swarmed by dozens of smiling children and friendly people eager to get their photo taken when they saw how my digital camera worked. Only a two or three were able to speak English. I met one gentleman who said he was over 100 years old.

They proudly gave me a tour of their village showing me where they pumped water, milked cows, cooked over a small fire, made pottery cups for drinking, and even a shop that cut glass lenses for eyewear. Their home structures were mostly red brick, but there were also concrete and stick-framed rooms for homes. It looked to me like there were few floor structures other than dirt. I was told I would see “raw village life” and I certainly did.

There was no privacy in this village – there were open doorways to homes with villagers, dogs, cattle and goats milling around.

About a half mile down the road I participated in a ribbon cutting ceremony to officially open a new healthcare camp. The medical team from the Shanti Mangalick Charity Hospital now uses this location to perform health care checks on the villagers – especially exams for eye disease. About 50 percent of the patients have cataract eye disease, which needs to be treated or there is a risk of loss of eyesight.

Dr. Mahesh Mangalick, who initiated my visit, is the administrator of the hospital and arranges treatment of cataracts through very simple and economical sutureless surgery with appropriate lens implants. Very low fees area charged, mainly to cover costs of materials and operation related expenses. A mere $50 can help cover the total costs for both eyes, but these poor villagers cannot afford even this amount.

We gathered in an area where large colorful tapestries were strung out to create a tent and were welcomed by girls singing Indian songs in Hindi. I then spoke briefly to a crowd of about nine hundred after meeting the member of the Lower Assembly in the State Legislature of Uttar Pradesh, who was present as an additional host. Over eight hundred received a health or eye exam that morning.

Next, I joined the village elders for lunch and discussed their chief interest in gaining ideas and suggestions to improve the yield of their crops. Of course, I wasn’t very helpful in this area, but I have to admire the can-do spirit and strong optimism that these people project.

Minnesota connections:

Dr. Mangalick first met staff from the University of Minnesota’s School of Public Health about 10 months ago and since that time has received some grants to get computers for maintaining patient health records. They’ve also begun hosting visiting staff from the School of Public Health. There’s even a new side office painted in gold with a University of Minnesota sign above the doorway that reads “University of Minnesota Visitors.”

I also toured the hospital, which is stark by American standards. I met several new mothers and their tiny babies that were delivered in the last 24 hours. They’re all together in a large room of hospital beds, but there is no air conditioning to help with the intense outside heat and humidity. Needless to say, this hospital is performing admirably for the citizens and villagers in the Agra area.

Last night, I enjoyed the hospitality and had the privilege of dining with the family of Vikash Lall, who is the nephew of Minnesota’s state CIO, Gopal Khanna. It was an all-family affair with Vikash’s wife, two daughters and father and mother.

Vikash said he definitely sees a noticeable expansion of middle-class Indians moving up the economic ladder. It will take time but hopefully it’s this emergence that will eventually provide opportunities to poorer areas of India, such as the Kavis villagers.

On the Road

Today our group drove by bus from Delhi to Agra, the home of the Taj Mahal, which is named one of the Seven Wonders of the World. The drive took over 4 hours on a busy road with moving commerce, such as trucks carrying bananas or goods to be sold.

There is much to see outside of Delhi. Our route took us past elephants, camels or donkeys pulling carts, cows and bulls in the streets, and two men charming cobras with their flutes. In the midst of all this were people riding bicycles or motorcycles, cars weaving in and out of traffic and multitudes of people milling along the roadway at small roadside shops.

Yesterday, I was able to meet with members of parliament and learn more about India’s democratic structure.
• The lower house members are elected to terms of five years and members have a 65% re-election rate
• 10 percent of members are women
• Like the United States, India has a federalist system with strong state governments
• Voter turnout is about 55%, although voter participation is two to three times higher by people in the lowest economic segments
• The combined number of 3.2 million elected officials from all levels of government in India is more than the combined total of all elected representatives of all other countries in the world.

Higher Education
Indians have a high personal savings rate of about 34% (in the U.S. it has even been a negative number!), but most use this savings to pay for education, such as studying abroad. The 80,000 students currently studying in the United States makes India number one in our foreign student population – China is second.

There is a current need to build 1500 new universities if they were to provide a college education for those students showing the ability to attend. This is another reason why my initiative establishing an India Center at the University of Minnesota presents opportunity for both Minnesota and India.

Energy
There are many similarities and differences on the energy front for China and India.

Unlike China, India does not have coal natural resources so it must import vast amounts to create electricity. Today India imports 100 million tons, but by 2030 the number is expected to be 1 billion tons. This presents a real environmental concern and is another reason why India is looking to wind and nuclear energy supplies. Interestingly, the Indian company XXX is currently working closely with Minnesota in developing wind energy in Southwest Minnesota.

Also, unlike China, only 55 percent of energy needs are for commercial economic development purposes. And, due to inefficiencies in transmission lines and theft anywhere between 18% and 50% in some cities of energy generation is lost in transmission transfer.

Like China, ranks high as a world consumer of energy and the trend is moving them higher, as currently 57% of the Indian rural population doesn’t even have access to electricity yet.

Well, of course the Taj Mahal, built by 20,000 laborers in the 1600’s is beautiful. I also see great beauty and opportunity at every turn as I learn more about this country.

Country of Contrasts

My first impression of the world’s largest democracy is that it is indeed a country of contrasts. With 1.1 billion people, 750 million Indians live on $2/day or less (350 million of this group on less than $1 dollar/day) and there is a huge growing middle class population of 350 million -- more than the entire population of the United States.

This is evident on the streets of New Delhi where you see the vibrant activity of congested streets and people packed on sidewalks, while at the same time there are children begging for money. In many ways it’s a sensory overload.

Major roadways are crammed with cars, autorickshaws and bicycles, and then a cow will come and walk across the road and completely block traffic.

While at a meeting with the Indian Foreign Minister today, I noticed monkeys climbing all over the Defense building.

Yet, India is on the move with 9 to 10 percent economic growth rates fueled by a strong financial banking system, healthy IT and service sector and a confident entrepreneurial class.

In 1996, India had just 300,000 mobile phones nationwide, but by 2007 there were 150 million and now there are 6 to 7 million being added each month!

The people are extremely friendly and it was mentioned several times that they share the same values as our American democracy. The top news story on the BBC here was about the tragic bridge collapse in Minneapolis and whenever someone learned I was from Minnesota they expressed great sympathy for the situation in my state.

My favorite food is the tandoori chicken and lamb which is flavorful and cooked in a hot tandoori oven. And, it’s still monsoon season here, so we’ve had some rain and the humidity is extremely high. On the day I arrived our bus drove through 1 to 2 feet deep water during a major rainstorm.

From the proliferation of the internet to strong new job creation it is clear that India will take an important place not only in the global economy but hopefully Minnesota’s future.

Last Day In Beijing

Over the last two days I have visited with officials from the Foreign Ministry, the National Council for Social Security, walked through a rural village, visited the 2008 Summer Olympic site, and met with Li Fan, the nation’s leading democracy activist. He is a very inspiring individual.

Li Fan speaks of his goal to directly elect the President by 2020. His approach is to accelerate a political-reform process that lags behind the economic changes already remaking the country. It’s these economic changes that are evident when you look around – new cars, internet cafes and coffee shops, and many restaurants fueled by increased numbers of middle-class consumers.

Of China’s population of 1.3 billion, 800 million live in the rural area, but many are moving to the cities seeking employment and economic opportunity. There are now boomtown cities that are home to roughly 120 million migrant workers who have moved to cities looking for employment. The cash income for a family moving to the city can be the same in one month, as they would normally earn in a year in the rural areas.

Thus, the economy is leveraging that growth to reduce poverty and improve people’s stand of living.

One thing I’ve learned is that the number of people to people contacts and relationships between the United States and China is exploding in number. And, these activities are not being coordinated at an official level by the national governments, but instead on an individual basis, such as Eden Prairie’s recently established relationship with Loudi, China.

In particular, student exchange programs are very popular and the U.S. is the first destination choice among Chinese students. Ironically, my family is currently hosting two Chinese exchange students in our home from Beijing – Jingbin Yang and Ting Wang. They arrived one week before I left on this trip as part of a two-week program with Eden Prairie Oak Point Intermediate school. My own daughters have greatly enjoyed the experience and the exposure to Mandarin and the Chinese culture.

Other interesting tidbits:
• China’s population is aging: today there are 16 workers for every retiree, but in 15 years there will be 1.5 workers for every retiree. Here is an area where the one child policy has grave conditions for social security, as there aren’t enough workers to support the system.

• I met with Yue Sai Kan, known here as “China’s Oprah.” She is a successful media star, businesswoman and role model to women gaining economic freedom, which hopefully will someday lead women into playing a larger political role in China’s future.

• China’s biggest foreign policy concern is not allowing Taiwan to declare independence, but instead seek reunification to one China.

• All three of Minnesota’s higher education institutions (the University, state college system and Minnesota Private Colleges) have strong relationships and programs with Chinese higher education institutions.

The food is outstanding – in particular I enjoy the spicier dishes, like the Szechwan beef that included special peppers that actually make your tongue tingle like having novocain from the dentist. Dinner last night included Peking Duck and the fish in the photo above.

Preparing to leave for India next!

Energy Demand

As you would think, it’s the economic growth that has created the dramatic shift in the energy profile of China. It’s not just that more people are driving cars, it’s the fact that industry is itself is responsible for 70% of China’s energy consumption (compared to less than 25% in the United States).

Coal is abundant here, which is both a blessing and a curse. Large coal reserves provide a fairly cost-efficient method of generating electricity, but this comes at a price environmentally. Every 7 to 10 days a new coal plant is built in China to provide energy for a small city.

I met with Dr. Pan Jiahau, of the Chinese Academy of Social Sciences, the Executive Director of Sustainable Development, and he shared some statistics.

Energy Consumption of Coal
1990 – 650 million tons
2000 – 1.3 billion tons
2006 – 2.6 billion tons

This is a doubling in the past three years alone. And, during the same timeframe steel production has more than tripled. As a producer, China is now the world’s largest steel exporter. China has also now surpassed the United States as the largest producer of CO2 emissions in the world.

Once again, in the area of energy and the environment it’s the lack of enforcement that is a big issue because local officials are compensated for promoting economic growth. I was told that local officials would rather pay the fines for emission violations because it is cheaper than paying 25% more in energy costs alone to run the emission cleaning scrubbers on the coal plants. But if you measure progress by growth rates, this will eventually conflict with sustainability.

In the picture above, I met China’s General Manager of the Tang Energy Group, which is number two in the world market for manufacturing wind turbine blades to generate wind energy. He was very familiar with the opportunities of expanding wind energy production in Minnesota, as it is one of three states where his company and others might consider expansion.

In fact, he believes that in two years China will become a major manufacturer of wind turbines and will be looking for a state in the U.S. to setup a manufacturing base. This could be a natural Minnesota connection and opportunity.

Also, someone on the blog asked me how Chinese officials are handling the export issues and quality control criticism of faulty toy products, and tainted dog food and toothpaste products. The short answer is very seriously. Again, the big issue will be enforcement and hiring an adequate number of inspectors.

Growth and Challenges in China

My interest in China first peaked after my very first visit to the country in 2005 for a Young Leaders Program with the National Committee on U.S.-China Relations, a non-profit organization promoting cooperation and understanding between the United States and China. They recently celebrated their 40th anniversary and are involved in a variety of education and teacher exchange programs and were responsible for sponsoring the historic visit of China’s Ping Pong team to the United States and what became known as Ping Pong Diplomacy.

www.ncuscr.org

When I saw China for the first time that year, my initial reaction was “Wow!” – there was so much development and activity evident everywhere.

As I walked the streets of Beijing today I can say I feel the same way:
• In Beijing alone there are 10,000 construction projects currently underway;
• China will build 40 additional airports by 2010;
• In 1989, China had just 168 miles of expressways, by 2010 it plans to have 40,000
• China now exports in a single day more than it sold abroad during the entire year of 1978.
• In 1997, China had just 10 million cell phone subscribers, but today there are 500 million – many more than every man, woman and child in the U.S.

In the photo above, I met with several environmental leaders today who explained in greater detail how this development is of course having not only an environmental impact on China, but on a global basis:
• 16 of the world’s 20 most polluted rivers are in China;
• 320 million Chinese people do not have access to safe drinking water;
• 90 percent of shallow aquifers are contaminated

A big issue is that while the Chinese leadership is focused on water quality issues, the problem comes from enforcement because a local official’s success is measured by the level of local economic growth. Thus, they are quite willing to go against the laws and rules for their own interests at the expense of the environment.

At a business dinner meeting tonight I met an American gentlemen (married to a Minnesotan) who works with several Minnesota companies in connecting their engineers and their “know-how” with Chinese companies. He said it’s the smaller and medium size businesses with 100 to 500 employees where there is great opportunity because these companies provide a needed “value-added” component to manufacturing processes that can’t yet be done in China. This is where American jobs continue to grow.

And, he emphasized that there is also a strong value in having Minnesota students learn Mandarin and Chinese culture. I’ll continue to be an advocate!

Delays and Detours

I finally made it to Beijing after flight changes and delays. I was supposed to fly to Beijing directly from Newark, NJ originally. However, my flight from Minneapolis to Newark was canceled so alternative plans were made to head to San Francisco and then catch an international flight. That worked fine, but after arriving in San Francisco I learned my next flight to Beijing was delayed an additional five hours. So after some long travel time I arrived very late Sunday evening in Beijing.

It feels like current Minnesota summer here – very humid and warm!

Background and Just Starting Out

Well, I’ve never written a blog before, but I thought this would be a good opportunity to do so and share some of my experiences during my upcoming travels to China and India.

I’m traveling to China and India as part of a fellowship program with the Aspen Institute -- the Aspen Institute Rodel Fellowship in Public Leadership. (link here) I am honored and privileged to have been selected for this two year Fellowship, which began in December 2005, as it is truly a tremendous experience.

There are nineteen of us traveling and all are elected to different levels of government around the country. They include some pretty neat people, many of whom will continue to rise in leadership positions both at the federal and state level.

Go to this link to see a list of my Rodel class:
www.aspeninstitute.org/site/c.huLWJeMRKpH/b.1041157/k.585C/Rodel_Fellows_Inaugural_Class.htm

There is a lot of talk about China and India being two of the fastest growing economies in the world. I hope to share some of my personal observations because there’s nothing more credible to drive home the need to reflect or focus on a particular issue than personal experience.

For several years, I have taken an active interest in promoting Minnesota’s connections with these two important world economies. First, it was promoting Mandarin language opportunities in Minnesota schools and more recently I initiated the creation of an India Center at the University of Minnesota.

We start in Beijing, China for three and a half days and then go on to India. Before leaving Minnesota I met with several University of Minnesota professors and leaders as well as business people who are enthusiastic about the proposed India Center, current Minnesota connections and future opportunities. So, while in India I will have additional personal meetings, learning about their health care system, economy and culture.

So, over the next two weeks I’ll make some journal entries when I am able to get internet access.