I had the privilege of working under Vince Cable as a civil servant when he was the Lib Dem Secretary of State for Business, Innovation and Skills (BIS) in the first few months of the 2010 coalition government of David Cameron. For departments across the government, the switch from 13 years of Labour took some adjustment.  But here was an economist who had worked in the private sector and with international experience, so in many ways the transition looked easier than was arguably the case for other parts of the Whitehall machine. Less need at least for even making the case for evidence -based policies…

Now, using evidence and statistics galore, Sir Vince Cable, no longer in active politics, is himself making the case for taking stock of the implications of the unquestionable  rising importance  of India and China.

The recent crisis in the Middle East may of course be complicating this narrative. But although recent developments could well lead to lower growth for all, for a while at least the impact could be worst for the West. In truth it remains unarguably the case that these two huge countries with roughly similar billion-plus populations each are climbing up the income and technological scales, challenging US dominance and leaving an increasingly uncompetitive Europe lagging behind. 

Population growth differences matter here in terms of future growth scenarios. As the book argues, falling fertility rates and an ageing population are impacting growth prospects and government budgets across the globe. But for these two countries any differences in their population growth will be crucial in determining their relative superpower position. This will be particularly the case if China, as is expected, continues to see its numbers shrink while India enjoys further rises in its younger working population 

And a more febrile world environment could, of course, slow growth in any case. Important to remember that both leaders, Xi and Modi, have been relying on the increased prosperity of the last few decades for support for what look like increasingly illiberal domestic policies although India of course  still preserves  its democratic image. However, if, as Cable argues, it is economic success that has given legitimacy to the regimes, this may now become slightly more elusive with  the uncertainties emanating from the recent Middle East and Gulf crises. Indeed, the two ‘Development Men’, as the book calls them, may be losing their aura. China, for example, has already reduced growth expectations over the course of the next 5-year plan and is facing further issues from a continuing property market fall out and rising youth unemployment. 

But it remains the case that with the US hegemony waning, including in the overall payments and trading system, many countries and regions in the global south, but more widely too, are increasingly moving to China’s and India’s spheres of influence. Indeed, what this book tells us, with much statistical and graphical detail, is how crucial these two countries will be in shaping what emerges as the new international economic architecture, including on that relating to the environment and security.  And this, after hardly any involvement by either of them in the setting of the post-WW2 international order which has served us for the last eight decades or so.  Quite a turnaround.