Will India Recover?
A few days ago, the following tweet was retweeted approvingly by many Indians, no doubt out of a sense pride and patriotism. “Look, look,” they seemed to say, “Look, how great India was. In 1870, India’s GDP was higher than UK, US, Russia, Germany, France and Italy. In fact, India’s GDP was over four times that of Italy.”
Countries by GDP, 1870 CE ($ billion) China: 189 India: 134 UK: 100 US: 98 Russia: 83 Germany: 72 France: 72 Italy: 41
— The Int. Spectator (@INTLSpectator) December 26, 2014
I can’t fathom what motivates such mindless jingoism. Only those incapable of basic arithmetic are prone to such idiocy. As the late great John McCarthy used to say, “He who refuses to do arithmetic is doomed to talk nonsense.” Nothing significant can be gleamed from raw numbers alone. At the very least, aggregate numbers are meaningless unless one contextualizes them. The simplest contextualization requires that you normalize them. I wrote about it here in Aug 2004:
. . . any raw number is essentially meaningless. We need to normalize the raw numbers before they can be meaningful. For instance, India is the largest producer of milk and produces 38,945,021 gallons of milk a year as compared to Denmark with only produces 1,045,983 gallons a year. India therefore produces 30 times more milk than Denmark. But that is meaningless unless one also knows that India’s population is 300 times that of Denmark. The proper normalization in this case is per capita milk production and consumption. That is, you take the raw milk production numbers and divide it by the respective population numbers to get the meaningful statistic that Indians only produce 10 gallons per year per capita while Denmark produces 100 gallons per year per capita.
It is simple arithmetic and those who refuse to do arithmetic are doomed to speak nonsense.
(Disclaimer: All the numbers above are straight out of a hat. They are definitely not accurate. They are for illustrative purposes only. The exact numbers are left as an exercise for the interested reader. For all others who are basically lazy like me, the fake numbers should suffice. You gets what you pays for.) [Source: High Population Considered Necessary but not Sufficient for Poverty.]
So let’s do the basic arithmetic and then see how India stacks up against those other countries in 1870. To save time, let me illustrate what I mean by deriving the normalized GDP figures for India and US only for 1870. India’s population was around 306 million (this site puts it at 306 million) and that of the US was around 38 million (this site puts it as 38,558,371 with astonishing accuracy). Per capita GDP in 1870 thus works out to be $438 for India and $2,579 for the US. Thus the US per capita GDP appears to be almost six times that of India.
Here I am merely illustrating a point that I keep making that raw numbers are meaningless. I don’t know where @INTLSpectator got those GDP numbers but to me they do sound suspect because the implied India’s per capita GDP of $438 in 1870 does not appear realistic.
I believe that in the past — perhaps a thousand years ago — India was not significantly poorer than the rest of the world, and perhaps it was richer. But it was impoverished by forces internal and external. Then a series of unfortunate things happened: the British Raj and after they left, the Congress raj of Mr Nehru and his progeny. Nehruvian socialism basically buried India. Will India recover? I don’t know. But I suspect that it will take the kind of policies that we are unlikely to see.