These days, our shores are awash with books on emerging economies. At least one new book hits the stands every month. These are mostly written by Americans. Of late, some Indians who have made it big in the United States have also jumped into the book-writing business. Morgan Stanley's top executive Ruchir Sharma's book 'Breakout Nations' stands out in this clutter of books. It is one of the most fascinating books on the world's new economies.
Like most authors writing on new markets, Ruchir Sharma gives importance to China and India, dubbed as the twin engines of future growth. He gives a country-by-country account, and knows how to tell his story lucidly. He avoids dry statistics and economic theories and gives an interesting personal account.
Sharma does not give sermons from a distant America or Davos. He spends one week every month in an emerging market to gain first hand, grassroots experience.
The book starts out with a trip to China. Sharma analyses China's growth story, which some call a miracle. He is not overawed by that country's sudden emergence as an economic leader. He is fair both in praise and criticism of the methods adopted by China to achieve its goal.
Sharma's analysis of the Indian market is fascinating. His Indian background gives him insights that a Western writer would never be able to glean. Even though he appreciates our urge to emerge stronger, he warns that we should not take our growth story for granted. India has just a 50 per cent chance of becoming a breakout nation (exceeding expectations of 7 per cent GDP growth) in the coming years, he says. His India-China comparison looks objective.
Sharma's chapter on Brazil shows his command over the subject, his clear head and his ability to link things. He devotes 70 per cent of his analysis of Brazil's success story to a comparison of the country with its major trade partner China. He rues Mexico's crony capitalism and its ill effects. He has a similarly dim opinion of Russia.
After a decade of rapid growth, the world's most celebrated emerging markets are poised to slow down. Which countries will rise to challenge them? Sharma attempts to answer questions like this.
As an introduction in Amazon rightly says, 'To identify the economic stars of the future we should abandon the habit of extrapolating from the recent past and lumping wildly diverse countries together. We need to remember that sustained economic success is a rare phenomenon. As an era of easy money and easy growth comes to a close, China in particular will cool down. Other major players including Brazil, Russia, and India face their own daunting challenges and inflated expectations. The new 'breakout nations' will probably spring from the margins, even from the shadows. Ruchir Sharma, one of the world's largest investors in emerging markets for Morgan Stanley, here identifies which are most likely to leap ahead and why.'
'Breakout Nations' reads like a travelogue, a business travelogue! It takes the readers from China to India, Eastern Europe to Russia, Indonesia to Sri Lanka, Nigeria to South Africa, and Mexico to Brazil. He weaves a great contemporary economic story linking dozens of emerging economic powerhouses across the globe.
This is among the best books to understand the emerging world and its positive and negative aspects. Sharma matches the brilliance Thomas L Friedman, author of the widely cited 'The World is Flat'.
This book has been published by Penguin.
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