Commentary: Can India Be the Next China? There’s a Better Question to Ask

The South Asian country might not become as big an industrial powerhouse as its neighbor soon, but it has the potential to rapidly grow its manufacturing sector

Workers install solar panels in a village in Kutch district of Gujarat, India, on Jan. 12. Photo: VCG

In the past couple of years, the economic fortunes and outlook for China and India have diverged. China’s economic recovery has been weak after the pandemic while India’s has been strong. China is also facing many structural challenges, including a rapidly aging population, while India has a relatively young and growing labor force and a far friendlier external environment.

Many investors are asking: Can India be the next China?

We think this question is not simply about whether India can grow rapidly over a long period of time and become as large and as rich as China today. That is not difficult to answer — with a population already larger than China’s, India’s economy will become as large as China’s today sooner or later.