Even as China closes the gap with the US on artificial intelligence (AI), the tide could again be turning. China remains a poor country with a nominal per capita income of $13,800 compared to US per capita income of $91,880—nearly seven times that of China. With China’s GDP slowing to around 4 per cent a year and the population ageing, will China grow old before it grows rich? – Minhaz Merchant
China was the world’s largest economic and demographic power for most of history. Its dynasties—from Han 2,000 years ago to Qing in the 20th century—regarded their country as the Middle Kingdom. Foreigners, including traders and soldiers from the West, were dismissed as barbarians.
Between 1644, when the Qing dynasty seized power, and the end of the 18th century, China was a global hegemon. The West’s rising powers in the 1700s, Britain, France and Spain, sought China’s silk, porcelain and tea. By the late 1700s, Qing China was at the peak of global power and wealth.
As the Industrial Revolution took off in Europe in the 1770s, isolationist China fell behind in science, technology and industrial production. Neighbouring India had meanwhile fallen to British colonial rule. India and China did not share a border. Tibet was an independent state till the early 1700s. The Himalayas were a shield between the two Asian giants.
China and India had not fought a war in 2,000 years. Ironically, it would be the British colonial conquest of India that would lead to what became known in China as its “century of humiliation” following the Opium Wars in the mid-1800s.
The British exported opium from its Indian colony into China. As a result, both India and China suffered simultaneously at British hands. Indian farmers in Bihar and Bengal were forced by the East India Company, a front for the British Crown, to grow opium poppies in place of food crops for export to China. That caused food shortages and famines in India and opium addiction in China.
The British forced China to accept Indian opium as payment for Chinese tea, for which there was great demand in England. Chinese tea had earlier been paid for in British silver and gold. Now it would be paid for in Indian-harvested opium. The British thus caused famines in India and opium addiction in China while bolstering its silver and gold reserves.
The Opium Wars were inflicted by Britain on China between 1839 and 1860. They forced a weakened Qing dynasty to sign unequal treaties and cede Hong Kong to Britain. In a brutal coup de grâce, the British extracted reparations (euphemistically called financial indemnities) from China, rather than compensating China financially for land and trade, further impoverishing it.
The Qing dynasty fell in 1912. It would take another 100 years for China to again rise as a global power in the early 21st century, threatening the hegemony of the West, now led by the United States, a progeny of the British Empire and inheritor of the violence Britain had for centuries inflicted on the world.
In an irony of fate, it was the US that rescued China in the 1970s from poverty and revolution by allowing it free access to its proprietary technologies. China’s GDP in 1979, when Beijing and Washington first established diplomatic relations, was a trifling $0.18 trillion. US GDP in 1979 was $2.63 trillion. The gap was 15:1.
By 2012, when the US fully woke up to the geopolitical threat China posed, China’s GDP had soared nearly 50-fold to $8.67 trillion, second only to America’s GDP in 2012 of $16.25 trillion.
But now, even as China closes the gap with the US on artificial intelligence (AI), the tide could again be turning. China remains a poor country with a nominal per capita income of $13,800 compared to US per capita income of $91,880—nearly seven times that of China. With China’s GDP slowing to around 4 per cent a year and the population ageing, will China grow old before it grows rich?
As The Guardian reported: “China’s economy is showing signs of extending a slowdown with a slump in industrial output and retail sales in July, adding to pressure on Beijing to intervene with measures to support activity. After the world’s second largest economy posted one of its lowest quarterly growth readings on record in the three months to June, the latest figures suggest it continued to falter in July.”
China’s premier Li Qiang meanwhile suggested: “Currently, the problem of insufficient domestic demand remains prominent, some industries and enterprises are facing increasing difficulties, and uncertainties in the external environment are rising. We should actively stabilise external demand, expand mutually beneficial international economic and trade cooperation and promote balanced trade development.”
There is a twist in the tale. As China’s population halves to 650 million by 2100, according to UN projections, its per capita income will double. So, China could grow both old and rich at the same time—not unlike ageing, wealthy Europe today, which had tormented it centuries ago.
What about India? China’s fall in the 1800s from global hegemon to the mercy of Western powers is instructive. As India rises, chaotically but with certitude, it must seek partnerships with both the West and China across technology, trade and defence.
But it must remember their histories. China fell to Western duplicity, rose by exploiting Western technology, and is now falling again because Mao Zedong’s one-child policy during the 1966-76 Cultural Revolution, which killed 30 million Chinese, consigned China to demographic Armageddon.
The West’s history is even more ignoble. It rose from tribal Anglo-Saxon barbarism to engage in violence and plunder where it could.
In India it could.
That lesson must be absorbed by Indian leaders as the country rises. Build partnerships with all but remember that success has many enemies—both at home and overseas, to its west and east. – Firstpost, 21 August 2026
› Minhaz Merchant is an editor, author and publisher.
Filed under: china, india, USA | Tagged: chinese demography, chinese economy, european colonialism, india-china relations, US-china relations | Comments Off on China’s fall, rise, and fall again – Minhaz Merchant
