Racing the elephant against the dragon

By C.R. AND THE DATA TEAM

IN 1991 India's finance minister presented a budget to India's parliament that would change the economic history of his country. His reforms dispensed with mounds of the red tape that reined in Indian growth, and opened up many industries to foreign capital. But India was a late-comer to the liberalisation game; China had been opening its economy since the 1970s and accelerated its efforts in the 1990s. China's reforms have been the more successful; except for a brief period in 1999, the Chinese economy has consistently outperformed its smaller neighbour. But that picture may soon reverse. Official statistics published on February 9th revealed that India’s GDP rose by 7.5% in 2014, a shade faster than China’s over the same period. Later this month Narendra Modi, India's prime minister, is likely to push new reforms. India also enjoys a demographic advantage. Whereas China's workforce began to shrink in 2012, more than half of India's current population is younger than 25. India, rather than China, may henceforth be the symbol of rapid emerging-market growth.