Nepali Times Asian Paints
Economic Sense
Looking east


Less than two months ago this Beed dwelt on 'Action Asia\' (#244) and is tempted to discuss it again. People keep asking about the potentials in India, China and Southeast Asia, and will Nepal not benefit from their growth?

The rejection of the European constitution by France and Netherlands is a pre-cursor to the rejection wave, which means even economic integration will be jeopardised. This will make Europe think ahead. The integration of east European countries in the Eurozone will become more difficult. There are a few core competencies at making the European state a potential leader of the future.

The US is still trying to push its growth in terms of GDP but their knowledge base is becoming an issue. Foreign student inflow is decreasing due to stringent screening norms but American universities are suffering along with the potential loss of skilled manpower for the future. In the next 10 years, it would be interesting to see how many people from countries like China still send their students to the US. Highly educated global workers are already heading for home where they can earn at par and enjoy equal lifestyles.

United States\' biggest insurance has been innovation. It lost the car market to Japan but led in technology, it lost the hardware market to Taiwan and China but continued innovating on applications, constantly staying on top. With an eroding knowledge base that is not being replenished, will that competitive edge remain?

The current situation seems similar to that of the early 20 th century when the world looked at the US and Europe for development, trade and business. In terms of geography too, everybody wanted a piece of the pie in those regions. Today, the same is happening with future action poised between China and India\'s growth, the world is looking eastward again.

These countries together with the South and Southeast Asian countries, provide a marketer\'s dreamland. It is not selling the seventh pair of sneakers or the fourth tv set to a household. It is selling to households that are yet to have a tv or the first pair of sneakers to an individual. The combined middle-class potential of the two countries alone surpass the total population of Europe and the US. So does India or China need to look beyond their own territories?

With highly populated countries like Pakistan, Bangladesh and Indonesia also unleashing their own purchasing power, the focus will definitely be on this side of the world. Everybody is watching to see who will emerge the leader: democratically governed India with its known problems or centralised China with its unknown pitfalls.

And here we are in Nepal, wallowing in the muck of our own making, not seeing beyond the Himalaya in the north or the tarai in the south. We have two powerful locomotives right next to us, let\'s take our wagons out of the sidings and hitch ourselves to them. They will pull us out but we first have to set our political house in order.

(11 JAN 2013 - 17 JAN 2013)