When I heard that Pratibha Devisingh Patil, the Indian president, was coming to China to help forge closer business links between the world's most populous and second-most populous nations, I was reminded of a story told to me a couple of years ago by a contact at a major European bank.
He had travelled to Mumbai, India's financial hub, with a delegation from the institution. They landed at the airport, and three hours later, after a sweltering drive through desperate poverty and some of the worst traffic in the world, they pitched up at their destination. The welcome was warm, but the three-hour journey was long enough for the executive to make his decision to continue to favour China in his firm's strategy and keep India on the back burner. India is just not there yet, was the message he brought back to the management board.
Discussions about India and China generally examine their relations as a kind of race, one in which China is way out in front in most categories, from GDP growth to poverty alleviation to success at luring foreign direct investment. On paper, India has so much to offer that would seem to give it a competitive edge: an established legal system; the high level of spoken English; and an abundant supply of cheap labour - Chinese labour is getting expensive these days, especially if you are looking at it from Europe, with its flagging euro currency.
However, India is also crippled by its caste system, an overweening bureaucracy bent on regulation and a poor skill set in terms of the overall populace. But what is perhaps more interesting is the growing closeness between the world's two most populous nations. India has long looked enviously at China's success and Ms Patil's visit marks the latest stage in an effort by India to learn from China and develop their bilateral relationship.
Ms Patil is the first Indian head of state to travel to China in a decade, which shows there is still work to be done almost 50 years after the two countries fought a brief border war. But the tone has been upbeat. Hu Jintao, the Chinese president, has said the visit would boost "mutual understanding and friendship and advance the development of the China-India strategic partnership". One of the highlights of her visit was advertised as the first major brainstorming session of the India-China Business Development Forum tomorrow.
Despite the gains, irritants remain. There are trade issues, and China has two major territorial claims: one in Arunachal Pradesh and the other in Ladakh district in India-controlled Jammu and Kashmir. The Chinese were also angry about the recent visit by the Dalai Lama, the Tibetan leader, to Arunachal Pradesh. These tensions aside, the country's have ever more in common. The president's visit will build on Mr Hu's state visit to India in 2006, which produced a 10-point strategy to expand and intensify a strategic and co-operative partnership between the countries. Manmohan Singh, the Indian prime minister, came to China in 2008 to further underline this growing closeness.
Ms Patil said in a recent interview with China's official Xinhua news agency that as developing nations, India and China had similar approaches and viewpoints on many global issues, and she believed the two countries could also co-operate in the reform of international financial institutions. India and China have worked together smoothly within such international frameworks as the Group of 20 developed and emerging economies and the so-called BRIC countries, which also comprises Russia and Brazil. And the two countries famously co-ordinated with each other at the UN Copenhagen summit on climate change.
But on economic issues, it is such co-operation that stands out, not the divisions between the countries. Chinese companies are building airports, power stations, roads and factories that India needs to help expand its economy. Perhaps if the roads are functioning, then the big investors will feel more comfortable in adding India to their development strategies. Though it will still be some time before India's expansion comes at China's expense.
@Email:business@thenational.ae
