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Business News/ News / World/  Asia’s ordeal with colonialism

Asia’s ordeal with colonialism

Singapore-based economist Prasenjit Basu on how a collective history of Asia enables us to understand why East Asia succeeded while West Asia is in disarray

Prasenjit Basu seeks to free Asia’s history from what he perceives to be the coloured lens of European colonists.Premium
Prasenjit Basu seeks to free Asia’s history from what he perceives to be the coloured lens of European colonists.

Singapore: Prasenjit Basu is a Singapore-based Asia economist, an academic and commentator whose new book, Asia Reborn, presents a compelling and comprehensive story of the continent—its ordeal with colonialism, wars, and famines in the 20th century to its present-day resurgence and renaissance.

“A continent that lay supine and exploited in 1900 had been transformed by 2017 into an industrious, dynamic and increasingly creative force capable of taking humanity to new heights in the 21st century. An Asian renaissance of the kind unfolding today was incomprehensible 100 years back," says Basu.

In Asia Reborn, Basu presents a modern economic and political history of the whole of Asia, told from an Asian perspective. He looks at the historical narratives rising from the divergent histories of Taiwan, South Korea, Singapore, Hong Kong, Malaysia, Indonesia, China and India. And binds them cogently into a unified story of Asia in the 20th century and its rise from the ashes. Basu seeks to free the continent’s history, from what he perceives to be the coloured lens of the European colonists, who deliberately fragmented and distorted it, to put across a more favourable narrative of their colonization.

According to Basu, nobody else has yet assessed, collectively, the 20th-century trajectories of the Indian subcontinent, Central Asia, South-East Asia, North-East Asia and West Asia, and its impact on the world today.

“A collective history of Asia enables us to understand why East Asia succeeded while West Asia is in disarray (see Syria, Iraq, Iran, Afghanistan); how the partition of India contributed inexorably to the rise of Al-Qaeda and ISIS," says Basu. “Why Soviet overlordship left Central Asia’s economies overdependent on primary-commodity exports; and why South Korea was able to absorb technology from the same Japanese collaborators (Nippon Steel and Mitsubishi Motors) far more effectively (into POSCO and Hyundai Motors) than Malaysia was (into Perwaja Steel and Proton)."

According to him, the second half of the 20th century in Asia is better known as the era of the emergence of prosperity in the East. But this is an incomplete picture that his book seeks to redress. “Asia’s present conflicts, conundrums, and challenges cannot be understood without the context of what happened in the first half of the 20th century and this remains largely unexamined or misunderstood."

Basu is a former chief economist for South-East Asia and India at Credit Suisse First Boston, chief Asia economist at Daiwa Securities and global head of research at Maybank group.

His book provides a nuanced understanding of how Asia threw off the colonial yoke in the 20th century which holds lessons for it in the 21st century. According to him, one Asian nation stood out from the rest. “Japan was able to adapt the best of the West while retaining its cultural moorings and incubating nationalism among Asia’s exiled nationalists, from Jose Rizal to Sun Yat-sen to Rashbehari Bose and Artemio Ricarte."

Japan also paved the way, in his view, for an ideal development model. “In 1930-35, Takahashi Korekiyo demonstrated how capitalism could survive after a Great Depression—through policies that came to be labelled as “Keynesian". Sadly, Nehru admired Stalin and ignored his other great contemporary, Takahashi."

Asia Reborn takes the view that the legacy of the impact of Europe’s colonization on Asia is exaggerated, while that of Japan—which ruled over Indonesia, Malaysia, Singapore, Taiwan, Korea, and half of China—is underappreciated. “These nations fared far better and indeed rose to become economic giants due to Japan’s governance. In contrast, Britain-ruled colonies, including India, remained impoverished and became bankrupt."

“In the 21st century, Asian countries need to delve into their own success stories to find nuggets of policy wisdom and development models that enabled it (Asia) to succeed against all odds in the 20th century," he notes.

Basu also explains in his book how India needs to seriously consider some of the lessons from Asia’s—and its own history—to become the next Asian powerhouse.

Edited excerpts from an interview:

One of the central themes of your book is comparing the colonization of Asia under Japan and Britain. And the vastly different impact left by both on modern-day Asia. What was the key difference?

Japan’s role in 20th-century Asia was akin to Napoleon’s in 19th-century Europe that enabled him to effect widespread institutional changes that helped “modernise" Europe: codifying civil law, strengthening administrative structures, upgrading technology, etc. Similarly, although Japanese wartime atrocities receive wide publicity in the western press, the role of Japan in nurturing nationalism in the countries it conquered, and in building the institutions of modern economic development (especially in Taiwan and Korea) is often obscured. East Asia is dynamic and independent today because Japan stood tall against Western imperialism between 1905 and 1945, helping incubate nationalism across Asia. In contrast, West Asia was smothered longer in the colonial embrace and suffers civil wars that are legacies of that embrace.

While the institutional legacy of Japan is under-appreciated, the allegedly positive legacy of European colonial rule is much exaggerated. Eventually, European imperial powers built some railroads, a few desultory highways, and some rudimentary ports; they decidedly did not educate the populations of their Asian colonies (in contrast to their white-populated colonies in Australia and Canada). In the popular press, democracy and railroads are still routinely referred to as legacies of European rule in Asia. This book will show how ludicrous such claims are.

How did India fare differently under Britain versus the Asian colonies under Japan and why?

India fared terribly under most indices, as compared to its Asian counterparts colonized by Japan. In Asia Reborn, I examine an intriguing question as to why is that the parts of Asia colonized by Japan—Korea, Taiwan, Northeastern and Coastal China—were the most industrialized and socially advanced in terms of literacy and life expectancy at birth in 1950 and remain so today, while the parts of Asia colonized by Britain the longest—West Bengal, Bangladesh, Bihar, eastern UP (Uttar Pradesh), Odisha, coastal Andhra Pradesh, coastal Tamil Nadu—are the poorest.

The clear and often overlooked answer that emerges is that Japan focused on literacy and education; reformed agrarian structures; developed effective infrastructure; and invested in genuine industrialization, while Britain primarily focused on only looting the parts of Asia it conquered. As a result, Britain turned Bengal from the most industrialized region of the Mughal empire into an economic basket case by the 1940s. Also, India’s life expectancy at birth in 1950 was only 32 years—lower than the African average of 38; China’s 41 (despite three decades of civil war) and Taiwan’s 54 (after 50 years of Japanese rule). And India’s literacy rate, too, suffered terribly. It was 14% in 1947, while Taiwan’s was over 60% in 1945. Coincidentally, India’s literacy rate was the same as Iraq’s in 1958, the year the British-installed puppet monarchy was ousted from Baghdad.

What other contrasts does your book draw between Japanese and European imperialism and consequences on modern-day Asia?

While European imperialism was based on the principle of divide and rule, which has left its malign imprint across erstwhile European colonies—from Iraq and Syria to the Indian subcontinent, Myanmar, Sri Lanka and Malaysia—the Japanese introduced Bahasa into Indonesia’s schools and Tagalog into those of the Philippines, binding them as nations for the first time, while also giving independence to Myanmar, Vietnam, Laos and Cambodia—which the British and French could never completely undo. Hence, the deliberate destruction caused by European colonizers in the social and political environment of their colonies was largely the reason for rampant poverty in the colonies. The British, Dutch and French colonies were bogged down in social conflicts with little attention given to modernizing economies, unlike the Japanese.

India continues to struggle with the legacy of Partition and the modern-day threat of terrorism from its neighbour. You trace the security and economic problems of current day South Asia, especially Pakistan, and lay it squarely at Britain’s doorstep. Please explain.

Indeed, one cannot look at terrorism in South Asia today without squarely looking at Britain’s role in creating the conditions for it to fester and ripen. The creation of Pakistan was integral to Britain’s grand strategy. The problem for Britain was that the North West Frontier Province (NWFP) had elected Congress governments in both 1937 and 1946, and the NWFP delegation had entered the Constituent Assembly of India in December 1946 (defying the Muslim League’s call to boycott it).

If they were to ever leave India, Britain’s military planners had made it clear that they needed to retain a foothold in the NWFP and Baluchistan, because that would provide the means to retain control of Iran (where BP’s predecessor, the Anglo-Persian Oil Co., owned oil reserves), Iraq (where a British puppet monarchy enabled tight British control of Iraqi Petroleum Co.) and the potentially oil-rich British protectorates of Kuwait, the Trucial States (now the United Arab Emirates), Bahrain and Qatar.

The sordid story of how Nehru caved into Dickie Mountbatten’s sly entreaties (with more than a little help from Edwina) to persuade him to agree to a referendum in the NWFP—boycotted by Ghaffar Khan’s Khudai Khidmatgars—is one of the great tragedies of the period. History would have been different if this had not transpired. Badshah Khan himself was largely confined to Pakistani jails for the rest of his life, in order to ensure that the ISI (Inter-Services Intelligence) could subvert the peaceable Khudai Khidmatgars and instead train vast cadres of jihadi terrorists—first the mujahideen led by Gulbuddin Hekmatyar, then the Taliban and Haqqani network, and later Osama bin Laden’s Al Qaeda.

What economic lessons can India draw today for its development based on your book?

If India is to succeed with ‘Make in India,’ it needs to draw lessons from Japan, Taiwan and South Korea’s approach to industrialization—while mitigating the Achilles Heel of East Asian industrialization (the repressed financial sector).

With an abundance of labour at every skill level, India still has the capacity to belatedly achieve an industrial revolution, especially if it rapidly reforms its labour market. The South-East Asian economies, led by Singapore and later emulated by China, sought to attract FDI (foreign direct investment) by multinational corporations (and overseas Chinese businessmen to China). The more appropriate model for India will be the model of Japan, Korea and Taiwan. Like them, India has a large entrepreneurial community that can be induced to participate in industrial development.

The key is to:

• a. Ensure real estate as an alternative means of wealth creation is minimized;

• b. Credit is directed to those with a demonstrable ability to create world-leading and export-oriented businesses, rather than to property speculators;

• c. The bureaucracy develops long-term expertise in key areas of industrial development (skills training, labour market flexibility and redeployment, technology imports and research and development) and public enterprises are led by specialist managers with long-term mandates to make them world-class (and to privatize partly or wholly if that is the only means to turn around a chronic loss maker).

Additionally, our Constitution hobbles social development (public health, nutrition, education, etc.,) by making them all state subjects, while giving all the revenue-raising power to the centre. This is a problem that Japan, Korea, and Taiwan never had to confront.

Without universal literacy, and the basic levels of health and sanitation necessary to a modern existence, we cannot expect to achieve the 10% annual economic growth that our demographics should be delivering at this stage. That land reform in India was uneven is an impediment (relative to Japan, Korea, and Taiwan), but not insurmountable. But rapid industrial growth is still needed to move people from low marginal-productivity agriculture to labour-intensive manufacturing (the first stage of industrial development that India has largely skipped). Vietnam, Bangladesh, and Cambodia are now demonstrating that labour-intensive manufacturing still has a role.

The self-serving consensus that has emerged in India about robotics and artificial intelligence precluding the basis of labour-intensive manufacturing is empirically unsound, in my view. The need for labour market reform identified in the Bharatiya Janata Party’s 2014 election manifesto still remains relevant today, although it has only been modestly implemented in five states.

What is your projection for Asia in the 21st century in the coming decades?

The 21st century will be Asia’s century, but the financial fragility of its erstwhile economic behemoths (Japan and China) will prevent any single Asian nation from dominating the world (thankfully).

The cultural links across Asia, however, should help bind the region more closely together, even as some ancient nations (like Tibet) find a renewed voice in this century. Asia and the US will need to cooperate far more than the Pax Americana of the 20th century allowed.

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Published: 01 Dec 2017, 03:48 AM IST
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