[AbbeFaria]

Here’s my take as an Indian having lived in cities like Mumbai, Hyderabad and Bengaluru

1. No manufacturing expertise in India, we aren’t a manufacturing powerhouse despite having similar levels of population as China. We have always prioritised services. That has an inherent limit.

2. Local governments here are powerless. I don’t have the source for this but only about 3% of public spending is done by local governments at the municipal level. Even for “rich” cities, local governments although are wealthy they are always controlled by whoever has power at the state level. It’s why Indian cities have such decrepit infrastructure vis a vis China.

3. Caste based politics and more recently freebies based politics. Recently, state governments all over India have been all out bribing voters with cash transfers if voted to power. This won’t bode well for long term financial stability. This is also short term thinking at its finest. They have run out of ideas.

4. Weak rule of law. There’s a huge backlog of cases in our justice system right from Supreme Court to the local courts. Doing business in India can backfire in spectacular ways (inordinate tax demands by union government etc).

Entire studies can be done but these are top 4 things keeping India where it is.

[JumpCrisscross]

No. 4 doesn’t really make sense as a disadvantage relative to China.