China and India represent two of the most important forces reshaping the global economy, but they have arrived at this moment having followed very different paths. China surged ahead through manufacturing, exports, and an activist, but authoritarian state. India, by contrast, followed a more uneven path, shaped by democracy, a robust services sector, and a different relationship between government and markets. 

A new book, Eclipsing the West: China, India and the Forging of a New World, by the British economist Sir Vincent Cable examines the bigger question of what the rise of China and India means for the future of the world economy—and the international order. 

Vince Cable is a British economist, author, and former politician who has spent decades thinking about the changing global economy. He served as Britain’s secretary of state for business, innovation and skills from 2010 to 2015 and later as leader of the Liberal Democrats. Before entering politics, he worked in government, international organizations, academia, and the private sector—including as chief economist at Shell. Today, he is a Professor in Practice at the London School of Economics in the School of Public Policy.

To talk more about his new book, Vince joins Milan on the show this week. The two discuss Vince’s first visit to India as a student in the mid-1960s, the contrasting reception to his writings on China and India, and the concept of “superstates.” Plus, the two discuss the ability of India to shape global order, Indian democracy’s “fork in the road,” and three possible futures for an emerging world of superstates.

Episode notes:

1.     Martin Wolf, “Best books of 2025: Economics,” Financial Times, November 19, 2025.

2.     “A Sixth of Humanity and the Dreams of a Nation (with Devesh Kapur and Arvind Subramanian),” Grand Tamasha, October 22, 2025.

3.     Devesh Kapur, “Why Does the Indian State Both Fail and Succeed?” Journal of Economic Perspectives 34, no. 1 (Winter 2020): 31-54.

Transcript

Note: this is an AI-generated transcript and may contain errors

Milan Vaishnav Welcome to Grand Tamasha, a co-production of the Carnegie Endowment for International Peace and the Hindustan Times. I'm your host, Milan Vaishnav. China and India represent two of the most important forces reshaping the global economy, but they have arrived at this moment having followed very different paths. China surged ahead through manufacturing, exports, and an activist but authoritarian state. India, by contrast, followed a more uneven path shaped by democracy, a robust services sector, and a different relationship between government and markets. A new book, Eclipsing the West, by the British economist Vince Cable examines the bigger question of what the rise of China and India mean for the future of the world economy and the international order. Vince is a British economist, author, and former politician who has spent decades thinking about the changing global economy. He served as Britain's Secretary of State for Business, Innovation, and Skills from 2010 to 2015, and later as leader of the Liberal Democrats. Before entering politics, he worked in government, international organizations, academia, and the private sector, including a stint as chief economist at Shell. Today, he is currently the professor in the practice at the London School of Economics in the School of Public Policy. To talk more about his book, I am pleased to welcome Vince Cable to the podcast for the very first time. Vince, congratulations on the book and thanks so much for taking the time.

Vince Cable No, thank you very much for inviting me.

Milan Vaishnav What was interesting about this book as I got into it was trying to sort of put myself in your shoes and you're reflecting over the course of a career where you've had multiple intersections with both China and with India. And you talk about how you first visited India as a student, I think it was in the mid-1960s, which kind of kicked off a lifelong engagement with the country. And later, of course, you spent time in China as well. I wonder if we could just start by asking you to tell us a little bit about your own personal relationship with these two Asian giants and how your relationship evolved over time.

Vince Cable Well, I think the deepest and longest relationship is with India. I went in the mid-60s, traveled around India on my own. And then I married a wonderful woman who of Indian heritage, lived with family, lived in Goa. So, I had a personal and then a professional interest in going backwards and forwards to India. I used to write for The Economist group about India for a couple of years, I think, and did... A creditable book with somebody you may have heard of called L. C. Jain, who was one of the leading Gandhian economists in India. So, you know, very long-standing interest, personal or professional. And then in the early 90s, I got that rather interesting job in Shell, responsible for scenario planning, and then as their chief economist, and they sent me both to India and China at about the same time. The decision in India was—do we set up a big Indian operation, they'd had bad experience in the past, corruption to be frank, and the question was: was I going to advise them to go back in with proper investment in the country and the positive outcome. And I was going to China at the same time and of course this was just in the middle of the, you know, the great building boom that was lifting Shenzhen from being a kind of sleepy fishing village to a vast metropolis. You know, the dam reforms were at full volume, they haven't yet got around to joining the WTO but you could see that China was moving at lightning speed and there was real development you could it tangibly, whereas in India... I saw the, you know, the big progress, economic progress over time, but of course it was more gradual.

Milan Vaishnav You know, you have written about both of these countries in the past, and one of the things I found so interesting in your book was this very striking contrast in terms of how your work on the two countries was received. So during the pandemic lockdown, you wrote a book called The Chinese Conundrum, and that book made the case for positive engagement with China on a variety of grounds, economic, environmental. And you say in the book that that book kind of earned you the label of a quote-unquote apologist. Now by contrast in the 80s and 90s, when you were writing enthusiastically about India's growth story, a growth story that took place under democratic auspices, your arguments largely fell on deaf ears. What do you think explains that divergence between the two reactions?

Vince Cable The Indian story, as you know, there is no barter publication, there's no censorship. My stuff was being published and read, but I don't think anybody, certainly in the West, really believed in the Indian growth story. I mean, we'd had the Manmohan Singh reforms, and they were beginning to take effect. But the idea that later became fashionable, you know India shining through the great growth story hadn't really taken off at that point, a lot of skepticism, problems in India, as you know. So there was, I think my optimism about Indian development wasn't really believed either in India or in the West. In China's case, I've always tried to be careful not to be too much of a hawk or too much of a dove. I like the idea that people should be owls rather than doves and hawks about China. And I did produce initially a book called The Chinese Conundrum before I did this Eclipsing of the West. And the reaction in China was sympathetic. Yeah, you've written a kind of balanced account, but nobody was going to risk their neck publishing it. I mean, there were too many passages that were uncomfortable to the authorities, so the state publishers politely declined. I found China quite an interesting and difficult place to express views. And I do, as it happened, have a Chinese social media account called Xiaohong Shu, Red Note, which has about a quarter of a million followers. So, I do manage to communicate in China, but the book wasn't allowed. It's published in the west, but not in China.

Milan Vaishnav One of the contributions that your book makes is to try and kind of socialize this idea of a super state. So, a lot of observers look at international politics and they talk about great powers or major powers or superpowers, but you say a more useful concept for understanding China and India is the super state, and I'm wondering if you could just explain to our listeners what is a superstate and what does that concept capture that the more familiar language of say superpowers or great powers does not.

Vince Cable Well, I think the old language about super states was sort of geopolitical. The Soviet Union, the United States, there was all the baggage around nuclear weapons…Super states I see primarily through an economic lens, China on purchasing power parity basis is now the biggest economy in the world. You can argue about how you measure these things, which on a par with the US, and India is the third. Long-term trends suggest that you know India's overhauling the other two. I know there's a lot of quibbling in India about the statistics and there's 7.8 percent growth mean anything like that but it's clearly growing very fast and, you know, a plausible look at the future suggests we're probably talking about three major economies of roughly equal size. In India's case, this doesn't necessarily mean being a superpower with global reach in a military or political sense, but simply a very major economy, you know, with impact on the rest of the world. It's already beginning to do that, you know, the sheer scale of the thing. So, my concept of the super state is sort of economically driven rather than the usual kind of geopolitical way of classifying countries.

Milan Vaishnav I mean, I found your analysis of the two economies to be quite interesting. And I mean that's really what the meat of the book is about. And as you're talking about the contrasting growth models of China and India, you argue that at least in one important respect, they belong to kind of the same family, which is that both countries practice forms of state capitalism. And I wonder if maybe you could just elaborate on that a little bit. In what ways, in your view, do the Chinese and Indian models converge? And where do you think their particular models of state capitalism fundamentally differ?

Vince Cable Well, they started off pretty much with the same model. I mean, Nehru famously identified with what he thought were the better aspects of Stalinist industrial development and the five-year planning system. Mahalanobis and so on was very much based on Soviet ideas about how you plan an economy and industrialize. So, you know, in a way they started with the same, you know, package of ideas. If you bring it forward to today, you're talking about economies which are roughly 50-50, you know, state, private sector. The state is very powerful as a regulator in both cases. In China's case, it's probably more systematic and, you know, more organized, but the state sector in India is very powerful too. The financial sector, much of it's publicly owned, but at the same time both countries have a very robust, highly competitive private sector, particularly small, medium-sized companies, millions of them, and going down to sort of peasant-level private farming. China's system of rural ownership isn't quite the same. They have effectively long leases, but they essentially peasant farm as much as the same model as in India. So the overall structure isn't greatly different. Where they've diverged is more about timing. I mean, the Chinese embarked on market-led, what they call reform and opening out on the Deng Chaoping shortly after Mao died in the of the 80s and it was very, very, quite dramatic. Systematic, it was consistent, and quite brutal. I mean, people tend to forget that Tiananmen Square events were partly caused by public reaction against decontrol of prices, which they did in a very radical way. So, the Chinese market reforms were tough, aggressive, consistent, and followed through. Whereas in India's case, after Manmohan's changes, they were more gradual, they had to accommodate the public reaction in a democratic system, and the big difference in the pattern of development that's emerged is that the Chinese conquered the world economy in manufacturing. It became the factory of the world, starting with labor-intensive manufacturers. India never really got into that. It didn't liberalize sufficiently radically. I don't think the ambition was ever to become a major low-cost manufacturer. That is the big gulf. India now has, I don't know, 3% of world manufacturing. In China's case, it's a third of the world manufacturing value added. It's a vast difference and that's where the reforms have taken them in different directions.

Milan Vaishnav So I want to just actually pause on this because you have these numbers in the book where you say, you know, just consider things like clothing, footwear, textiles, right? These are the kind of classic entry points into labor-intensive manufacturing. And over this large period you examine, India increased its share of world markets in these sectors from, I think, one and a half percent, give or take, to about 3.2. China's share soared from 1.3% to 37.5%, right? So, I mean, this is just orders of magnitude larger. And I wonder if you could just say a little something about what specifically China got right or maybe India got wrong that produced such radically different outcomes in labor-intensive manufacturing, because one would have thought, I mean given the vast pool of people that are in both countries and especially India now, that they could have taken advantage of this labor.

Vince Cable Yes. I don't think India never really opened up to the same extent. The Chinese basically threw open the door, welcomed in foreign investors, because a lot of whom were overseas Chinese from then Hong Kong, Taiwan actually, initially, then Western companies. Chinese have no inhibitions about it. They took the view, you know, we want to learn from foreigners if they can help us get access to world markets, no problem. So, they had these very ambitious economic zones, which provided a kind of platform for very rapid export growth. India never took it quite so radically. They did have some export processing zones, but there was always a reluctance in India to liberalize imports and always some inhibitions about admitting foreign companies and so liberalization in India didn't go anything like as far or as fast. And of course, when the Chinese pursued this policy consistently over time, of course the outcome is radically different.

Milan Vaishnav I guess just to push you a little bit on that, I mean, you know, I think there are a lot of people in the current government who take a different lesson, right, who say, well, we need to have a kind of state-directed type of development, which makes sure that we protect our infant industries, that we don't, say, enter into mega-regional trading deals like RCEP with China or the Trans-Pacific Partnership for that matter. We need to increase tariffs, we need to really double down on industrial policy. So, if you kind of take that prevailing view, why do you think they're learning the wrong lessons from the Chinese experience, if I could say that?

Vince Cable Well, protectionism, I think, has been very damaging to India. If you go back to the World Trade Organization, the big round which took place, I think 2008, 2009, India was regarded with the Americans as the big block. Their trade negotiator was nicknamed Dr. No. India was highly protectionist. The Chinese, on the other hand, were smart enough to see that World Trade Organization was their ally and it was throwing open Western markets for them to sell into. So, I think India had fundamentally the wrong mindset about international trade. It's slightly odd that a communist country should have got back to the basic principles of Adam Smith and comparative advantage and Ricardo, they understood that, whereas India together with Latin American countries was clinging to this idea that it should cut itself off from the world in trade and it would have been very damaging and inhibiting.

Milan Vaishnav And do you sense that, we're going to get into this a bit when we talk about future scenarios, but do you think the mindset has fundamentally changed where India now today in 2026 understands the need to be more externally oriented, to be export driven, to try and find ways of getting into global supply chains? I mean, how do you view the mindset of the government today compared to the mindset that you just described?

Vince Cable Well, I think it's moved in the right direction. Then of course, India has been very successful in certain types of exports, with software services, providing a comprehensive service to big corporations and so on. It does that very well. And it's beginning to try to track companies into global manufacturing supply chains. But it, it doesn't have anything like the same degree of that the Chinese had. And part of the, you know, the basis of protectionism is rooted in democracy, right? You have very powerful vested interests. I don't mean vested interests necessarily pejoratively, but you know farmers, right. And the Chinese have no compunction of, you know, throwing farming interests under the bus, as we say, if it gets in the way of policy. But in any, you can't do that. And, you know, big, big businesses in India have an interest in protecting their home markets, whereas in China, competition between the big corporations is ferocious. And in a way, there's an analogy between what the Chinese did and the Koreans did, who they sort of pioneered this approach to developing heavy industry and shipyards and in the car industry. And you've got industry protection and subsidy, but then they're forced to compete and compete in world markets. And India's never enforced that kind of discipline on its large-scale industries.

Milan Vaishnav Towards the middle section of the book, you review how India and China have done on a whole number of socioeconomic indicators. And one of the conclusions you come to is that on almost every indicator, to the extent that data is reliable, China outperforms India. But you do issue two important qualifications, and I thought it was useful to maybe go over those qualifications. The first is that, India is performing better than China did, when China was a comparable level of per capita income. And the second is, you know, China remains resistant to what you describe as Western notions of welfare, while India, of course, has developed an embryonic welfare state that actually this government, despite being described as right of center, has expanded upon. I wonder if you could just say a bit more about these two qualifications.

Vince Cable Well, on the on the latter, I mean, I always find it interesting talking to Chinese big businessmen. I mean they could have stepped out of the pages of Dickens, you know, the whole attitude, workers have got to work hard, they pay too much. We don't need all this namby-pamby stuff about labor protection. And that's, I think, you know, that's why calling it a communist country is extremely ambiguous. And the providing, you know, big businesses ultimately under the control of the Communist Party, the Chinese authorities have absolutely no problem in just letting them rip and letting market forces operate to the greatest extent. In terms of welfare provision, of course then in a way it's an extension of that and then sees approach at present. I mean, they could ease the slowing down of the Chinese economy, the almost depression that they're getting into by spending a lot on rural health and education and an embryonic welfare state, but they're very anxious to avoid the dependency which welfare state produces in their view because it would detract from the priority that they give to security concerns, whereas India is becoming in an embryonic way, a kind of welfare state. I think one of the great achievements of the Aadhaar system is this, you know, very small payments, but the idea that the very poorest people in society can get access to credit and, to some extent, benefits. I mean, that's a real social advance. That's not happening in China, probably never will. And this is where India's democratic system has its genuine attractiveness. I think where India fell very badly behind the Chinese in health and education at the primary level was that I think the model of decentralization in India with the federal system has meant that responsibility for these very basic human capital provisions was left to state governments. They neglected it, whereas in China, they may not have a welfare state, but they wanted one or two basic essentials. Even in the dreadful, chaotic period of Mao Zedong and the Great Famine and the Cultural Revolution, the one thing that they insisted on was getting primary school children educated, so that when the reforms came along, there were a sufficient number of Chinese who knew how to operate businesses, for example. And India, as I think Manmohan and others have fully acknowledged over the years, slipped very badly behind in this concern for human capital and basic health and education provision.

[…]

Milan Vaishnav I mean, there is this really interesting graph which features in the new book by Devesh Kapur and Arvind Subramanian, which you cite, and I think it comes from an earlier paper that Devesh published in the Journal of Economic Perspectives, and we'll link to both of those in our show notes, where it shows the United States, China, and India, and the share of public employment that exists at the federal, state, and local level. And one of the things you see is that China and the U.S. are very similar in that the bulk of public employment is really at the local level. They have relatively smaller federal and state governments. In India, it's exactly the opposite. They have very large federal and State governments and very small local governments. And I think, you know, when you talk about this issue of decentralization, I think one of the things that economists will point out is that local governments in India really haven't been empowered. And that's really where the rubber meets the road. And when you're providing, say, sanitation, potable water, health, education, it's really at that level that people can hold their representatives accountable. And that has been a big part of your failure. And I don't know if you have a view on that.

Vince Cable Yeah, no, I think it's a very important insight, the way that you've developed it, that the level of decentralization seems to me to be absolutely critical. And it isn't just India and China, I mean, we're having this big debate in the U.K. about the way growth has been stifled in the U.K. because of extreme centralization. And the Indian model, which concentrated decision-making in central government and state governments and neglected local authorities, panchayats, lack of discretion, inability to raise funds, I think was absolutely crucial. Whereas the Chinese, you know, we have this caricature that all the decisions are made on Xi Jinping's desk. But actually, when it comes to economic choices, the Chinese basically encouraged local authorities to do what they could do. And you've got promotion within the Communist Party for development and been able to show that, you know, you've attracted a couple of companies into an export processing zone. You've set up a science complex somewhere. The way they did it was, may not have been sustainable because in some cases it just involves setting off. Selling off land, raising the capital and using the capital for development. And of course, that land is now being used up around cities. A lot of local authorities are going bust, heavily in debt. And the Chinese system, which has worked brilliantly, is now beginning to get very seriously gummed up with domestic debt and the need to sort out the finances of local government, whereas India has never gone down that road.

Milan Vaishnav I want to stick with politics for a moment here because you argue that, you know, there are similarities in terms of the state capitalist model, but there are also similarities when it comes to the politics, right? And so there's, we have a kind of conventional contrast that we make between these two countries where you have, okay, authoritarian, one-party China on one hand and on the you have a pluralistic, multi-party India. And you say that conventional view can obscure important similarities between the two. I wonder if you could tell us a little bit about, you know, to what extent does a convergence you identify in the economic domain perhaps extend into the political realm? What are the similarities that you see there between the two.

Vince Cable Yeah, I don't want to stretch this too far. I mean, India is there's been some criticism of the way under the current administration, some democratic rights have been eroded. But India is still a democracy. Most of these international comparative indicators put India amongst flawed democracies or partial democracies. And China is at the other end of the scale. I mean it doesn't have even have phony elections like Russia. They just don't believe that the democratic system has anything to offer. So, in a very big, aggregated way, they are different models. But the similarities are several. I mean, one of which is, you know, you've got absolutely vast countries. I mean these are unimaginable scale for Europeans, you know, 1.4 billion people. And very diverse, extraordinarily diverse in language, religion, and other things. And the idea of territorial integrity, which is a polite, diplomatic phrase for clamping down very hard on minorities on the periphery who want to be independent, and the Chinese are particularly brutal about it, it has this in common with India, which certainly doesn't want another partition. So, a concern for territorial integrity is certainly one of the elements in common. I think the second is in such incredibly diverse countries, you need some kind of unifying ideology and the communist party in China provides that, Xi Jinping thought. I mean it may be terribly incoherent and very difficult to see how they reconcile it all with the rampant capitalism, which is what China is about these days. But nonetheless, there is a core of belief, of doctrine. And you sense that in India, consciously or unconsciously, an attempt to create similarly a unifying idea. I mean, it used to be the secularism of the Congress era, and now it's Hindutva and it's probably not very unifying, if you look at it from the point of view of the states in the South, but nonetheless it has the same basic objective, and a very understandable one. You know, how do you govern enormous, highly populous, very diverse societies? And in the respects in which I've quoted, you'll get similar response.

Milan Vaishnav I mean, I guess, you know, you sort of talk towards the end of the book about the future and we're going to get into some of the future scenarios, but let's just stick with the India scenario where you say India has essentially reached a fork in its road, right? You have one path that leads towards something you call messy but consensual democratic politics, while another path involves Modi and the BJP doubling down on their previous exploitation with autocratic government. It's now been two years since the 2024 general election in which the BJP came back to power, of course, without a majority and as part of a coalition. Given that we're now in September 2026, how would you assess the direction India has taken and do you think it is proceeding further down one path or the other as you see it?

Vince Cable Well, it's very difficult for an outsider to get their heads around this properly. It does seem to me virtually inconceivable that India could operate through the kind of very highly repressive type of regime you have in China. I mean, you know, they had a revolution. The Communist Party has been in power for over a century. They've got cadres who are... I know India has the RSS, but China has party cadres, 100 million very tightly managed structures. I think India is just far too relaxed, isn't the world? Some people say chaotic, but much more diverse, varied, irrepressible, I think. You know, the mere fact that under, you know, people call increasingly repressive government, you've had all the protests, the cockroaches and so on. It's very difficult to see anything like that happening in China, though, of course, there is a lot of protest in China. I don't know, the outside world isn't aware of it. You do get a lot of strikes and demonstrations directed at local rather than national government. But I think in terms of the fork in the road that you've asked me about... I found it very difficult to see India becoming an outright authoritarian state. There is always going to be a high level of flexibility. You still have states, particularly in the South, which operate on quite different principles and very successfully. So I think the diversity there is going to remain. The way in which China and India are now diverging paradoxically, is the fact that India is now growing so much faster, and we can go back to those arguments about whether we are talking about 8% or 6% or 4%, but it clearly is India is motoring, it could be doing a lot more, at the same stage of development, China and we're getting up to 10% growth, India's not there quite. Whereas India, whereas China is visibly slowing and struggling economically, I think a combination, I call it a combination of a crisis of communism and a crisis of capitalism, the crisis of capitalism from the collapse of a property bubble and the wealth effects that have flowed from that and weak demand and the crisis in communism from the waste of capital, the very, very high ratios of capital to output. They're now getting these very innovative high-tech industries, but a lot of Chinese industry and infrastructure is very inefficient in economic terms. So you've got a slowing economy and an Indian economy that's accelerating.

Milan Vaishnav I want to turn to the geopolitics because that's an important feature of the book. And one of the arguments you make, which is not one I think a lot of people take issue with is that the central geopolitical developments of recent decades have largely revolved around China and the United States. India has so far exerted far less influence over the shape of the international system. What would have to change in your mind for India to become a genuinely consequential shaper of global order.

Vince Cable Well, it will have to sustain the kind of accelerated development that we're now seeing. And if that's sustained over a decade or two, India just becomes a major force in the world economy, other things being equal. So it may not necessarily be at the same level of China and the United States in military terms, and there are frontier technologies like artificial intelligence where India isn't really. A player that's roughly, as far as I can see, roughly the same level as countries like the UK, which are using AI, but are not part of the stack. So, I think technologically, India is in a lower division, but economically, in terms of sheer size, and sheer size matters, it is becoming closer to parity with China and the United States. But there are so many tensions in the US-China relationship, it's very difficult to see where it goes. I mean, we've got this meeting taking place this week. Very difficult to see any meaningful agreement over AI, over disarmament, over nuclear parity issues. So the relationship between the established two superpowers is a very tense and dangerous one. Whether that leaves more or less space for the middle economies, which would include the European Union, Japan and India. Very difficult to say. Probably India becomes more effective if it strikes better alliances. One of the things I do talk about in the book is this idea of multi-alliance approach that India's developed. It's part of the Shanghai Cooperation Agreement of the BRICS. It's also part of that quad with the US and Japan. And I think that's rather clever, actually, if you're a...

Milan Vaishnav And we've seen summits and all of these organizations take place in recent months.

Vince Cable Yeah, well if you're number three and you're striving in the long term for parity, having multiple alliances, even if they're rather weak alliances, seems to be the right strategy to follow.

Milan Vaishnav You talked a little bit about the U.S.-China relationship and the impact on India, but let me ask you about the China-India relationship. We have seen Xi Jinping and Narendra Modi meet at the BRICS Summit in Delhi last week. This took place against the backdrop of, you know, I think some reasonable signs of a cautious improvement in bilateral ties. We, of course, have the boundary dispute which remains unresolved, but I think both sides do appear interested in trying to kind of stabilize economic and political ties to a certain level. From your view, is the strategic rivalry between China and India that has been playing out structurally destined to deepen, or do you think there's actually more room for accommodation than is commonly assumed by the experts.

Vince Cable Well, there are fundamental differences of interest, and I think they're primarily in the security area. One of the things which struck me when I go to Delhi, I talk to security guys, is this sort of, well, it isn't pessimism, but fatalism that India is inevitably a long-term adversary and therefore has to be. Have strong alliances with the West, even though they may not like the Trump administration. I think that on one level that's accepted, but there are practical areas and important areas where China and India have a lot in common. For example, working relations with Russia, very important in India's case, and in China's different reasons having a common position on global energy and climate change. They were both victims of climate change, but they're also two countries heavily dependent on coal. There's a backup fuel, probably the two countries that are now doing most in terms of solar development and renewables. A common interest in the Middle East, big oil and gas importers. And I think probably the most important one of all is not developing a common currency, which is unobtainable and makes absolutely no sense within the BRICS group, but diversifying payment systems so that they're not dependent on US sanctions, which could happen at any time. It's interesting. It seemed to me that the M-Bridge, which is this quite sophisticated scheme that has developed, so the Saudis have walked away from it, but India seems to be part of a whole group of bilateral type arrangements, which are not designed to weaken the dollar, but become independent of it, and that's a position they have very much in common with the Chinese. So these common areas are very important, and I think India would be foolish to walk away from. Having good workman-like relations with the Chinese. I mean, just the same kind of questions actually have been asked in places like Britain, where we've become hopelessly dependent on the United States and desperately wishing we weren't, and trying to build relationships back with countries like China. And India is at least starting off from a more manageable base.

Milan Vaishnav Yeah, well, I mean, I think it's not Britain alone. I mean you see that across Europe, right? And I think many, much of the impetus behind the EU-India Free Trade Agreement, for instance, has to do with not just questions in Delhi about the US relationship, but also the kind of rupture in the transatlantic relationship. So that's provided the logic for them to get together. I want to maybe end by just asking you, Vince, to kind of maybe sketch out for us, if you might, the three scenarios that you end the book with, where you kind of, you know, gaze out into the future and try and understand the kind of emerging world of super states. And could you just briefly tell us what you think the three kind of scenarios are and what each of them entails with respect to China and India.

Vince Cable Well, the first one was what I called the Global West, where you have hard or soft alliances between countries that identify as part of the Western democratic world. This was, I think, the world in the Biden era, the Obama era, NATO very strong, the And on one side you've got, you know, China, Russia, Iran, a few other smaller allies, but you have quite a sophisticated set of alliances being built up to compensate for the fact that the U.S. Is no longer an overwhelming hegemon. So you have a global West in a more sophisticated form, and India is absolutely crucial to that. That is now clearly falling apart, or we don't know permanently, but certainly for the moment, with the Trump administration marrying into alienating its allies, including India. And that's why I think most people's mental framework is around the second scenario, which is what I call multipolar. You know, you have the US and its sphere of influence in the Western Hemisphere, you have China and its neighborhood. You have India, you've got Russia. I think essentially those four groups, potentially others emerging around Turkey, for example, Saudi. The multipolar world is the language to some extent that certainly that China uses. I think it's very much the model that Trump has started to use and many of the MAGA people. The problem with it is, of course, in that kind of world, who is responsible for international public goods? You're having a lot of competition between different blocs. Who is responsible for the international rules of trade, maritime freedom of passage, the law of the sea, climate? Pandemic management much else, there is no one obviously responsible in the way that there was when the United States was the dominant hegemon. So that appears to be roughly where we are at the moment, but it's a very unstable and in a way unsatisfactory long-term concept. So you then get into a third, which is where things really start to fall apart. And you inevitably end up in disasters of some kind, you know, we can envisage a collapse of financial markets, a major global recession, which isn't dealt with in the coordinated way we had back in 2008. We can envise very serious climate emergencies that are not addressed because the fossil field economy as the US, the Russia, Saudi are not interested. You know, all kind of disasters that could occur and it may be that this third scenario that I call a downward vortex, the vortex scenario, is that it does lead as a result of experiencing disaster a re-engagement with ideas of multilateral cooperation because the alternatives are just too appalling to contemplate.

Milan Vaishnav My guest on the show this week is the economist Vincent Cable. He is the author of a new book called Eclipsing the West, China, India, and the Forging of a New World. It was noted as a best book of 2025 by none other than Martin Wolf, the lead economics commentator and columnist for the Financial Times, who also had this to say about the book, “In this extremely important book, Sir Vince Cable, who is an expert on economic development, analyzes the prospective rise of China and India. The former is already a superpower, the latter is one in the making. By the middle of the century, the balance of global economic and political power will have been remade. The West, he insists, must prepare for this transformation.” On this, he is unquestionably right. Sir Vincent Cable, thank you so much for joining us today. It's been a pleasure to talk to you. Congrats again on the book.

Vince Cable Thank you.