Transcription
I went to China in 1990. Coming from Southeast Asia, we were brought up with Chinese people in Malaysia. But in Africa, I met Chinese from China who were actually supporting the liberation struggles. China didn't have boots on the ground, but was providing a lot of aid, medical nurses, medical officers, doctors, and other types of support. So, I was very interested in what China was doing despite still being very poor.
When I learned about Hong Kong, I went to China. I was staying at the Beijing hotel. You didn't even get your own key. I had a spatoon under my bed. It was a very different place. There were hardly many cars, or lots of bicycles. People were very poor. But I could see a sense that something was changing rapidly.
After four years, I managed to find a way to open the first, I think the first, international environmental consulting firm in China with support from senior Chinese government officials. When I met them, I realized that they had a vision of what China should be, but they knew it would take two or three decades to actually fulfill.
Around 2000, the international media, as part of the geopolitical sort of demonization of China, was making out that China was a catastrophe and everything was going to be very bad. But clearly, in the work we were doing as consultants, mainly working for multinational companies, I was getting a bit of an insight into also what policymakers in China were having to deal with. It was very clear that the scale of the problem was one that no other country had ever encountered.
We were doing some of the due diligence on some of the big M&A deals when foreign companies, Europeans, Americans, were coming in, buying out. And they had due diligence procedures that required and to identify all the environmental liabilities. And so from that point, I could see what the real scale of the problem was. And even me, with my knowledge at that time, felt this was an insurmountable problem that would take a huge amount of time for any country to overcome.
Then around 2005, as China began to bid for the Olympics, and I was in Tiananmen Square on the night that China was awarded the Olympics, and we couldn't see change that was beginning to take place. And China used the Olympics, and dare I say, the criticism that it was not going to be a success, was all going to be polluted, as motivation. The Olympics served as a catalyst for mobilization, but also experimentation with large-scale policies.
Starting from about 2006 onwards, through the next 10 years, China worked relentlessly through scientific knowledge and engineering capabilities that it was able to mobilize society. Today, we know where China stands, both in terms of electric vehicles, renewable energies, and the stream and river. People are swimming in it. The most important thing the Chinese were able to do, which is a reflection of the political system, was to make decisive steps to move certain very polluting industries. There were no negotiations. It was dictates because the scale of the problem is so large. Many of these were also state-owned enterprises. So the government had the power, but they also took the risk in terms of displacement of people. So I remember one, which was a large electric company manufacturing electric appliances, lighting, and all of that, 10,000 people completely moved. Right. And then the steel mill. So that's the first one.
The second was essentially beginning to put in place the infrastructure that enabled the issue of mobility to be addressed, but also planning ahead in terms of therefore bringing about clean vehicles. In 25 years, China has built more high-speed railway networks than the entire world combined. The United States has not been able to build one high-speed railway track, mainly because the political system does not allow to make decisions. The reforestation program goes back to the 60s.
In my book, The Sustainable State, I argue that in the 21st century, the challenge of what is loosely called sustainable development will be the most profound political economic challenge for all nations, particularly the large countries of the developing world. And to do that, we would need a very strong state. And therein lies the more controversial discussion about democracy as is practiced in say, Western liberal democracies, and other countries, the post, the previously colonized countries who've adopted the same model, and the inability to execute because of the consultation processes. And I argued that China would, that we would have to do something very differently.
I provide a case study of a province in China where the desert was being converted into green areas starting in the 1960s. And I actually been there, worked on a project there to see how people were given land, and it was not about money. The Chinese government was able to mobilize the populace and then do land reform and give them access to the land through the planting trees, but it was 20 years of hard work. And that again is a political system that helps, helps do that.
So, China has grown the largest amount. There can be criticism about the monocultures, but if you look at the cities, and I was in Hangzhou yesterday on the EBMAS, it's a bit like Singapore, but Singapore is small. But every square inch of every available public space is a tree.
Being of Indian origin, I've been very interested in because India is also large like China. India is probably the country that's most threatened by the convergence of the existential threats that we are faced with. And I've said this for a long time. India has one-third of the landmass of China. Its population is now going to exceed that of China. And going there frequently, we've all seen talked about the new India that is defined by the traditional metrics of exports and all of this. And the per capita GDP, India is still pretty low compared to China. So in terms of the environment, India sadly is so far behind.
When we go back and look at 15, 20 years ago, China had some of the most polluted cities in the world in terms of air quality. Today, India outranks the whole world in terms of the most amount of polluted cities for air quality. But it's also important to understand that quite often people talk about air quality. Water quality in India is terrible as well, and mainly because of sewage systems and all of that not being in place.
If you went to China 20 years ago and you saw the toilets, you would be, we'd all joke. You just don't go. Right. Today, you can go to toilets in small towns in China, and even airports, and the Star Trek. You can smell the deter away. Toilet cleaners have metrics like three flies and you're out. All of these sorts of very stringent conditions to improve it. Water quality in Chinese rivers have improved tremendously. This is not to say there's not a lot more work to be done. But if you look at the main rivers in India, the Ganga, the Brahmaputra, and all of those, water quality has not improved. They have got worse, in fact, because of the population, the industrialization. So it's not simply about air quality. It's water. Yes, it's soil degradation, and not to mention the sort of impact on the most disenfranchised large amounts of the population.
Now, even as I say these things, and I imagine you have Indian audiences listening to this, and I've spoken in India about this, immediately there is a reaction, particularly from middle-class elite Indians. And I think they are part of the problem that they have essentially desensitized themselves to the tragedy of the commons. But let's not forget as well that GDP growth does not, in fact, take into account pollution. So when many of these countries are now put their GDP growth, which is where they get their rankings in terms of what the World Bank and the IMF, pollution is not counted for at all. We just say that China did have the same problem. It was affecting its growth, but its GDP continued to grow, but the damage was much more widespread and not accounted for in GDP growth. But the Chinese recognized that and decided to essentially take action.
There are lots of lessons to be learned in terms of what to do, and in terms of the ability of the state to be extremely omnipresent, the state to be draconian in some of its measures. Sometimes the state has to be omnipresent, and it has to take very tough long-term measures and leave aside the interest of those with private interest. Now, that's what the Chinese were able to do. The problem for India, it's political. So there are lots of lessons it can listen, can copy, it can look at. The problem is implementation. And the problem of implementation in India is the institutions are weak. And democracy, I've argued this, does not sit comfortably with the need to make long-term decisions that have implications on what people think of as particularly those with vested interest as their rights to to grow.
So the fundamental difference is the Chinese political economy and the system allows it to do things that a liberal democracy like India is unable to do. But then we can define what is a liberal democracy and what isn't. And I would argue outcomes are the things by which you measure results. Then India is perhaps not really a democracy because it's not able to get the outcomes that should fulfill the sort of results that you want from good governance, which is supposedly why people say democracy is worthwhile pursuing in that form. India is not lacking in scientific capability. It has the scientists, it has the knowledge. So can China help, maybe with some of the advanced technology because it had a head start? But I don't think anyone can help India. Only India can help itself. And that is because it's a political issue.
So I've long stated that sustainability is essentially about political objectives. And a lot of people misconstrue this and they think it's something to do with the environment. The challenges we face in terms of whether it's climate change, air pollution, hazardous waste, it's an outcome of the economic policies we pursue. Our economic policies worldwide today are essentially at war. And this, I'm not a green hugger, panda hugger, or a member of Green Peas, but it's science and acceptance of macroeconomic realities. The economic model that we have pursued for the last 50, 60 years and push relentlessly is essentially at war with planetary constraints and people. The Chinese understood that much earlier, and now they are using technology to handle it in their own country.
So the Chinese can't do anything in India. The Indian government has to be able to have a system of governance that allows it to enforce. Fundamentally, the solutions to these problems are not technological problems. The question is a political problem. And the reason to answer your question that India has not been able to is because the political system does not allow for an impartial assessment of these issues and to bring the best minds together in a way, if I could use the word, is corrupt. Just like the United States financial system is a corrupt system at right now. It's essentially also militarized to the point of view it's corrupt. The Indian political system in terms of dealing with these economic issues is corrupt. It's weak. The best Indians are all there, but they are marginalized by the political system and the vested interest of big business. Large Indian businesses, not all, many are good, like companies like Tata, but many are essentially running rough shot about rules because the system is corrupt. And China is not free of corruption, but environmental regulations and infringement, the punishments are severe.
So the question of pricing our consumption of goods and services, the problem we have today worldwide, and I mentioned the sort of liberal neo-economic model, is that the entire economic model is premised on pursuing overconsumption by underpricing resources and access to resources. So when you mentioned water has always been underpriced, and it's not a question of pricing it out of the reach of the poorer people because you can do differential tiered pricing, these more complicated governance and economic issues, but you have to price it properly because otherwise you abuse it. So you're right to say that it's not about free power. It's even in my country, in Malaysia. Economists in the country know that subsidies for petrol and gasoline is not in the interest of the country, or also in the interest of the long-term sustainability of the lower income groups. So it's pricing it properly so that people use it judiciously, and then the government using the revenues from proper pricing and taxation to create the equity that one needs.
So in India too, I would argue that the first thing to do when it comes to water is you have to mandate sewage systems, and then you start pricing for water discharges, water usage, and industrial water use. It's not just in India, across the world, particularly in Asia, Africa is totally outpriced and illegally used. One of the most water-stressed countries in the world is Pakistan. And Pakistan is not a small country, peak at about maybe 350 million to 400 million people, is of the most water-stressed because a lot of groundwater has been used. And farming in Pakistan will come under increasing stress as groundwater aquifers start to diminish. So in India, it's the same thing. You have to price. But it comes back to strong institutions, governance, rule of law. And I hate to say it, Indians have been desensitized to the lack of rule of law, particularly in protecting public goods and common goods. And this is the failure.
And coming back to China, a lot more work to be done, but those protections are now there. Pricing is in, and they're using technology in many ways to ensure that it becomes a lot stricter and monitoring is carried out all the time. For instance, in places where water is scarce, there's a pricing mechanism for water. So, everyone is charged. And what they've also done is start and put in place, even in small towns, to protect rivers, sewage systems. Towns which are a thousand kilometers away from Beijing, in the last 20 years, sewer systems built in, and everyone has to pay a rate charge for all of these things. So this is the behavioral change that you begin to see in societies where the pricing mechanism begins to be put in place. And that's what in many ways transformed Singapore too.
One area that is not discussed a lot is the nightmare of urban solid waste management, which in India is now completely out of control in many areas, which has health consequences, river consequences, and waterways in many ways. There too, you have to start putting in the infrastructure and then pricing it. You hardly see any litter anymore in any Chinese streets, and this is a country with a billion people. What happened is pricing, enforcement, education, monitoring, changed behaviors in a space of 10 years. That's what needs to happen in places like India. But you start putting the infrastructure, pricing things properly, and then enforcement.
In fact, when my first book came out, I was interviewed on Hard Talk, and about liberal neo-liberal economics was the then the Reserve Bank head of India, Raghuram Rajan. And because he is so much in that system, that we would need to curb the rights of people to certain types of excesses that essentially in large urban areas create gross pollution that therefore affect everybody else. Car ownership is not a human right. But governments think that you need to have a car industry and flood the cities and the roads with cars to have development. The old theory that industrialization is kickstarted by having the automotive industry, it's a complete disaster now. So we've argued that we need to price these things in ways that would help public transport systems be developed. And in a small way, you can look at what Singapore has done, but through road pricing, it has essentially taxed the privilege of private car ownership. And that's essentially the only choice we have.
And so in countries like India, a completely remodeled way of looking at how do you create prosperity rather than think about growth is essentially the essence of how we need to look at the next 25 years of the 21st century because we will have 10 billion people, and the current trajectory is not going to be reversed, unless we reverse our complete ideas about what is prosperity, what is growth, and what do people in large developing countries have as basic rights.