Global Themes

On Globalization & Venture Capital

India vs. Israel: A lazy, half-baked comparison

Earlier last week, Shefaly  alerted me to this FT article by TN Ninan,  editor and publisher of Business Standard (one of India’s leading business newspapers) comparing India and Israel.

                     india-flag.gif                       israel-flag.gif   

In the article, Ninan noted that:

“…it takes a quick visit to Israel to put these signal achievements (of the Indian software industry) in perspective. At dinner in Tel Aviv with the man who advises Israel’s prime minister on economic policy, the subtle point is made to us that those armies of people walking every morning into the campuses of Infosys and Wipro are not in the same category as the large numbers of high-tech entrepreneurs being turned out by Israel.

…Israel has no fewer than 3,000 high-tech companies, supported by a flourishing venture capital industry that buys into garage-scale enterprises and takes them public once they have reached a certain scale. Last year alone saw foreign investors coughing up $10bn to buy into just 30 Israeli tech firms.

…more than a third of Israel’s total exports in some years have come from the high-tech area, and 20 per cent of the revenue earned by the electronics industry is ploughed back into R&D – some of which is a spin-off from the country’s massive investment in defence research.

…when you are told that firms in Israel have developed the voice over internet protocol (VoIP), Intel’s multi-core processor, the cellular telephone and most of Microsoft’s Windows NT operating system, and that the world’s electronics giants have invested much more in Israel than in India, Bangalore’s very creditable record begins to pale.

To be sure, Indian companies and the Indian branches of international firms have been doing more high-end work in recent years and helping to develop cutting-edge technologies useful for a range of industries. But for every product development claim that you can make on behalf of India, Israel can perhaps make a matching if not superior claim…”

Ninan’s footnote profile mentions that he is an award-winning journalist but this particular report was far from any award-winning news-story.

At the very least, it could have done with a little more homework…and in any case, a comparison between India and Israel is not simply apples and oranges…it is just PLAIN BAD.

Why do I say that?

The two countries have been on vastly different growth trajectories, have had very different business environment for several decades and share very little in common when it comes to development challenges…

To make it a more “apples with apples comparison”, you need to factor in (on the Indian side) an impoverished population of several hundreds of millions, stage of development, questionable government policies, problems of national identity, challenges of running a democracy on an empty (or partially-filled stomach) etc etc…Once you do that, India (surprise) begins to look much much better…or may be it is just the proud Indian in me rushing to India’s defense?

You decide.


P.S. I hope Barak is still talking to me after this!

May 12th, 2007 Posted by | India | 33 comments


  1. Shantanu, thanks for the hat tip and I am glad you wrote this. In my view, although the article suffered from obvious shortcomings, it did have the potential to influence many, since it did appear in the FT. A comment from someone like you, who works in innovation financing, clarifying how it is a bit of horse excreta is of course very welcome. You are of course more subtle in your expression 🙂

    I agree with you not just on account of being a ‘proud Indian’ to borrow your words, but because the argument suffers from several shortcomings not uncommon in TN Ninan’s writing in general. As earlier conversations on your blog – notably with Krishna and with Simon Lazenbatt – might show, my love for India (or for that matter for my adopted country, the UK, as evident on my blog) is not unadulterated and blind. Part of loving something is to know its faults and shortcomings. Tough love? May be. Certain and reliable love? Yes, and despite evident faults.

    Ninan’s article is not an argument, it is a rant. That is where much of the problem lies.

    The article also refers to the 3rd *I*, Ireland, which was largely if not entirely a beneficiary of all the European subsidy that MADE it capable of competing.

    In case of Israel too, the country’s innovation financing is considerably from funds from elsewhere (I was the lead UK adviser on a EC project on regulation reform for innovation financing/ VC where we also had a team from Israel..). Dare I say that being a ‘manufactured’ nation versus being one that has – in IT lingo – a ‘legacy’ problem also leads to something that renders India and Israel incomparable! Also it is harder being a functional democracy – which resists every urge to bomb its neighbours or its other constituents, with whom one may have disagreement; this makes India’s problems very different from Israel’s.

    A harder context is not an excuse, of course, but Ninan’s article is devoid of any kind of nuance. Black and white are two attractive and certain colours on a palette, but they pale in comparison with the spectrum of a rainbow spectrum and many, many shades of grey. I know which one I prefer, even if the starker choice makes for a clearer and easy-to-write article.


    Comment by Shefaly Yogendra | May 12, 2007

  2. Looks to be an article rustled up in a hurry. Too many mix ups. Science & Technology has been muddled up with IT outsourcing prowess skillfully monetized by a few companies – where employees are just billable numerals. No mention of India’s achievements in the field of Aeronautics and Space research, Sattelite launches, Cryogenic fuels (with the likes of ISRO, DRDO, CSIR)- all while per capita income is $ 350, less than $1 a day, that is – Perhaps Ninan had taken the Israeli hospitality too seriously that made him care less for perspective.

    Still better would’ve been a peep into history. The State of Israel came into being in 1948 created by waves of wealthy, highly educated immigrant Jews from Europe desirous of setting up a Zionist home, buying up lands from Palestinians – aided by the Balfour declaration of 1917 and restricted by the White Paper of 1939 introduced by the British. This limited Jewish immigration over the course of the war to 75,000 and restricted purchase of land by Jews, perhaps in response to the 1936-1939 Arab revolt in Palestine.

    Contrast this meticulous selective creation of a welfare state with that of a hurried carving up of India in 1947 – – the creation of Pakistan and the mess that followed ; engineered by the same British while wanting to exit in a hurry but totally clueless to deal with the multi-ethnic, multi-lingual culture, with its long history and a rich heritage. When they were clueless, they just destroyed. Something like what US and UK did recently in Iraq and the mess that they leave behind. Quite a habit. Isn’t it ?

    The commonality is the British colonialism and its aftermath. In one country they did well to selectively permit the well educated, wealthiest of communities (relics of the Holocaust with complete world sympathy, quite deservedly) to come in and create a land, with a continuous grant of economic support from the developed world – with a powerful lobby even today that winks to their excesses in the West Bank and the Gaza even today.

    In the other, they just wanted to heave good riddance after the mess that they helped create.

    Look at the net results from Iraq – large scale destruction, hanging of a despot, No WMDs discovered, all just for some shock and awe to mask that ill- conceived design to control oil assets. And now a PM who leaves Downing Street in a hurry to clutch the low hanging millions of the lecture circuit, stage managed by the spin doctors well in advance.

    Just that a few hundreds of dead soldiers might be turning in their graves while he lectures on.

    Comment by Krishna | May 12, 2007

  3. A bit disappointed by Shefaly’s and Krishna’s response which is very typical of most us proud (and maybe at times insecure) indians. If one separates the fact from the article then it is quite clear that Israel’s record in terms of IPR development is much better than India’s. Yes they have the full support of DARPA and other such agencies that US funds but the point is that their IPR development track record is better. Lets just focus on on that and not give justifications and be in denial about most things that we usually are. The same bloody arguments… Britishers this, Americans that, JUST 60 years after independence, legacy systems….god!!!!! I think we need to fix a deadline for such justifications. 🙂 Time to move on from our attachment to our legacy thinking.

    Comment by Indiamusing | May 12, 2007

  4. Indiamusing,

    I like the idea of that deadline too. But I am a bit fixated on numbers I often see in our annual Defense Budget – $12.5 billion per year on the last count. To put in perspective, that is $ 11.36 per Indian in an year – while 45% of our population lives with just under $1 a day.

    Yes, *same bloody arguments* ! Because it hurts. I want that money for our infrastructure, education, healthcare and development. Can you help me ?

    Bulk of it is spent on defending ourselves against Pakistan (who gets millions of $ in aid to fund this on the pretext of being an “ally on War on Terror”) and its relentless insurgency across the “line of control” (instead of a demarcated Border – yet another colonial fallout) – including maintaining armed forces at Siachen Glacier, at an altitude of 5,753 meters, the world’s highest battlefield.

    Show me another rich country forced to stay impoverished and having to waste its resources on defense when it has starving millions ?

    I would never have an issue if you stop at appreciating other’s achievements. I react only when you compare – because I feel hopelessly helpless.

    I hope I’ve made myself clear.

    Comment by Krishna | May 12, 2007

  5. I wonder if TN Ninan meant to do a broad comparison of the IT and Technology sectors in both the countries? This is just a thought.

    Otherwise Shantanu your point about apples and oranges is a valid one.


    Comment by Kamla Bhatt | May 13, 2007

  6. Indiamusing, if the causal and contributory pathways to a ‘result’ cannot be understood, the ‘result’ cannot be replicated or even fairly compared. Nowhere is this truer than in comparative policy that is enforceable and measurably effective.

    In your hurry to suggest you are disappointed, it is quite evident you did not read my comment at all. It is just good practice to read something you wish to be seen to critique.

    In my argument, which focuses on ‘framework conditions’ in all 3 countries in Ninan’s article, I do not blame anybody, British or American, nor do I exhibit the kind of blind love that afflicts many other ‘proud’ Indians, which is a term I borrow from Shantanu and use within quotes, because frankly one can hardly be proud of something one did not have much choice! In fact – and Krishna will probably know this from earlier conversations here too – my love is rather tough and objective ‘love’ which regularly means that both sides of any argument regularly misunderstand my points and think it is right to flame me. Go ahead, it is largely a free world.

    You clearly misread the use of the term ‘legacy’. India is a country with history and diversity. Which means that the legal and societal frameworks have complexities, which do not plague Israel (which I call a ‘manufactured’ nation). It is important to understand the causation and background before anything workable can be suggested policy-wise.

    The IPR commercialisation track record may be apparently better, but having closely studied their framework conditions (for the European Commission advisory project I mention) alongside an Israeli team, I am aware of the dominant funding routes and do not see that as ‘homegrown’ Israeli. Of course, any criticism of Israel is hard (see Shantanu’s PS) to make, without its being dragged into directions the original comment never intended, so discussion is muted and the best objective discussion happens in closed, mostly academic, fora.

    So I agree with Krishna in that Ninan did not just highlight, he compared. And that is the primary weakness of the article, and that is what most comments here are reacting to.

    Kamla: If a journalist’s intentions have to be guessed or deduced rather than articulated clearly, he is not such a great journalist, is he? Whatever he meant to do, it is a hash of an argument…

    Comment by Shefaly Yogendra | May 13, 2007

  7. Shantanu

    Nothing wrong with having pride for one’s home and rushing to its defence, but where was the attack? Seems to me that the usefulness of such articles is not in their scientific accuracy but rather in their ability to expose perceptions and foster debates which in many ways produce better results than having “fair” comparisons.

    All nations compete with each other over resources. If India wants to have more of Intel’s investment dollars it needs stronger arguments than those appearing in the article or in your post. Asking Intel to take into its considerations the hundreds of millions of India’s poor and deprived might not be the most effective strategy.

    In any case, Israel and India have discovered the obvious truth. Cooperation is a much better strategy than competition. Read more here:

    Bottom line: National pride does not sit well with being a victim. Israel and India are proud nations and so are their sons.

    Comment by Barak | May 13, 2007

  8. Shefaly and Krishna: Thanks for your thoughtful and well-articulated comments – as always.

    IndiaMusing: The point was not to justify India’s achievements* (under-achievements?) or deny that we have done awfully on many fronts (I liked Shefaly’s term: “tough love”!). Israel’s achievements are well recorded and the praise is well deserved. The point I was trying to make is that its a bad comparison – period.
    As for moving away from “legacy thinking”, all I would say is that it is not easy to forget several hundreds of years of subjugation and history in the span of a *just* a few generations…but a deadline seems like a nice idea (in theory, at least!).

    Kamla: Who knows whether TN had a broader comparison in mind – it is not apparent…might there be a “next instalment” in this series?

    Barak: Thanks for writing in…I agree that there was no “attack”…I should have perhaps put an exclamation mark after “rushing to India’s defense”. It was meant to be a light-hearted remark.
    You are quite right in saying that all nations compete for resources and in this era or global competition, we need better arguments than India is a great country because it has 1.1bn people or a 5000-year history or millions of poor people how need all the help that they can get (I have said this before: we – as in India and its government – simply cannot outsource basic socio-economic development).
    As regards India and Israel, I am glad that we have gotten over the relationship we had through the 50s right until early 90s. Strategically speaking, there is probably no other country in the world today whose interests are so closely aligned with India (I make this remark very carefully) and in the words of one of India’s foremost political thinkers from ancient times (Chanakya), Israel and India are “natural allies”. So cooperation is natural and very welcome.
    P.S. I like your bottom line!

    Comment by Shantanu Bhagwat | May 13, 2007

  9. Shefaly

    I am responding to your comment no. 2 above. Warning: The response contains some strong language 🙂

    You wrote:

    “The State of Israel came into being in 1948 created by waves of wealthy, highly educated immigrant Jews from Europe desirous of setting up a Zionist home, buying up lands from..”

    Huh! Wealthy indeed! I am sending you back to the history books to get your facts straight. Poverty in Israel was not much different that that in India for quite a long time. The conditions the early settlers faced were lethal. Struggling with famine, plague, complete lack of resources, surrounded by enemies and ruled by the Ottoman and then British empires, neither one of them particularly sympathetic to the Zionist cause. Indeed, there were waves of immigrants after 1948: Survivors of the Nazi concentration camps and refugees from the Arab countries, none of them particularly blessed with wealth, higher education or other useful skills. It is an undeniable fact that the Jews built their state from scratch with no help from the outside. Not even from DARPA.

    You say:

    “Contrast this meticulous selective creation of a welfare state with that of a hurried carving up of India in 1947 – – the creation of Pakistan and the mess that followed ; engineered by the same British while wanting to exit in a hurry but totally clueless to deal with the multi-ethnic, multi-lingual culture, with its long history and a rich heritage”

    Again, history tells us a different story. The British left Israel in a hurry too, leaving behind a big mess. A day after their ships set sail back to the UK, seven Arab states invaded the newly born State of Israel. In the years leading up to 1948, there was no meticulous creation of anything except Arab armies and the aggressive interference disallowing the Jewish population to arm and defend itself against mounting Arab violence. Israel won that war against all odds seeing 10% of its population lose their lives. It bootstrapped itself from the terrible economic situation that the war created and again, DARPA was not a factor.

    And you add:

    “The commonality is the British colonialism and its aftermath. In one country they did well to selectively permit the well educated, wealthiest of communities (relics of the Holocaust with complete world sympathy, quite deservedly) to come in and create a land, with a continuous grant of economic support from the developed world – with a powerful lobby even today that winks to their excesses in the West Bank and the Gaza even today. In the other, they just wanted to heave good riddance after the mess that they helped create.”

    Shefaly, this is the point were mere inaccuracies turn to pure fiction and perhaps worse. “permit, well educated, wealthiest, grant of economics support, powerful lobby, winks to their excesses…and in the other, they just wanted to have good riddance”

    What is left to say? Bring out the handkerchiefs. The same old story we heard for two thousands years: Powerful wealthy Jews, controlling the world with their money and (secret?) powerful lobbies, while we the poor and uneducated suffer because they are (choose one depending on your particular situation): [Russians, Germans, Polish, Christians, Muslims, Palestinians, Lebanese….].

    It is my opinion that the successful nations are those who look inside to find out how they can help themselves. The unsuccessful ones are those that forever look for blame and responsibility elsewhere. It is also my opinion that the world will do best to move on from this pathetic “blame it on the Jews/Zionists” favourite argument. Victims are such a turn-off.

    Does this all sound like personal and perhaps a trifle emotional?


    Comment by Barak | May 13, 2007

  10. Barak: I can see you are busy at your keyboard today!!

    On a serious note, thanks for the clarification. I have long felt that Israel’s history is very poorly explained to foreigners and popular *perceptions* about Israel are not necessarily due to malevolence but more because of a partial understanding…

    I think I may be an odd person here because of at least two reasons:
    1] my family background (my father was in the naval reserves and my father-in-law in the air force – so there was a lot of discussion about foreign policy, WW-II, Middle East, Asia, Israel and strategies of warfare around the dinner table – in fact, one of the earliest non-fiction books I read was on the “Six-Day War” written by an Indian general.
    2] my training in the foreign service (we studied world history in great detail)

    But I should really let Shefaly respond…

    Comment by Shantanu Bhagwat | May 13, 2007

  11. @ Shefaly – You repeatedly qualify the usage of the word `proud’ before your nationality by a caveat (a) it’s borrowed from Shantanu (b) you feel you can hardly be proud of something in which you didn’t have a choice.

    How do you feel about your ancestry ? Did you have a choice there ? Do you `hardly’ feel proud of your lineage or is it `tough’ love there too ?

    @ Barak – The issue is one of pointless comparisons that distorts the picture to the average reader. Anyway you might be aware that Intel has already committed $1 billion additional investment in its new project near Chennai, India and I don’t think that’s a decision driven by debates in the blogosphere. It’s got more to do with economics, efficiency, maintaining its own stock price (if not earnings growth) and the need to compete with AMD’s of the world.

    Comment by Krishna | May 13, 2007

  12. Barak,

    Those were my comments you’ve reacted to. Spare Shefaly to whom you’ve mistakenly addressed. So let me field that.

    History of Israel as is being made out is what I got to use. But the issue here is not of the glory of victimisation and seeking an excuse, because India does not need an excuse. India has enough resources to grow on its own and will, even as it has to do it with quite a heavy baggage that it cannot shed. And in anycase the industry and enterprise of Israel is well known. The argument and the defense was against asymmetric comparisons.

    Thanks for the clarification on History of your country which I have a great regard for.


    Comment by Krishna | May 13, 2007

  13. Krishna

    Indeed I am aware of it. Can’t say I have a deep knowledge or understanding of India and Indian affairs but I often share an office with Shantanu and as you might guess, India comes up from time to time in the conversation…

    Comment by Barak | May 13, 2007

  14. Barak, you were responding to Krishna’s comments, not to mine. 🙂

    Comment by Shefaly Yogendra | May 13, 2007

  15. Krishna: My point is that when we do very little to shape something such as our family’s ancestral achievements, we need to feel humble, not proud, by association. So I am humbled by my being of Indian origin, by the immense beauty of India in all respects, by my ancestry and my family’s liberal traditions, but I can hardly take credit for all these. Which is why I qualify that it is a term I borrow, as I do not usually use it. It is a subtle difference which is lost on many, especially those who do not know me except through my occasional comments on blogs.

    As for pride, that is something I strictly reserve for something I have achieved on my own. Mostly I think one has to get on with things rather than start to rest on one’s laurels.

    Comment by Shefaly Yogendra | May 13, 2007

  16. Shefaly

    I am still learning how to use blogs. I thought the line above the comment indicates the author and now I understand one has to scroll to the end. I will ask Shantanu to edit the names and my sincere apologies for jumping (or was it dumping) on the wrong person…

    Comment by Barak | May 13, 2007

  17. Barak, please don’t worry. That is ok. 🙂

    Comment by Shefaly Yogendra | May 13, 2007

  18. Barak: I made the same mistake; Sorry Shefaly.

    In the meantime, Krishna did respond (although his comment was mistakenly caught in a moderation queue) – it now appears at no. 12.

    Thanks everyone.

    Comment by Shantanu | May 13, 2007

  19. Krishna

    Now that your comment has been duly restored to number 12, all is in well in this blog. Seems like the British Empire managed to leave behind a bit of repair work to be done but what would life be without a challenge? And truth to be told, it left behind a lot of progress too.

    As long as we all drive towards morality and compassion in everything we do, the future will be better than the present. Indians, Israelies, Palestinians, all have a right for basic and dignified existence which unfortunately is not yet in their grasp.

    Thanks for the way you took my comments. Big of you.

    Comment by Barak | May 13, 2007

  20. Krishna asks:

    “Show me another [other than India] rich country forced to stay impoverished and having to waste its resources on defense when it has starving millions ?”

    Israel is forced to be financially responsible for the impoverished Palestinian refugees (UN considers Israel to be the occupier, therefore responsible) while simultaneously spending $68 Billion defending itself from attacks by those very same refugees. That’s just under $10,000 per person on defense, compared to India’s paltry (by comparison) $11.36 per person. (You can half Israel’s amount if you add in the 5M Palestinians to Israel’s 7M citizens.)

    Israel is engaged in 2 hot wars – Hamas/Palestinians, and Hezbollah/Lebanon, as well as a pending conflict with Syria, and potentially even Iran.

    Israel has been at continuous war since its inception in 1948, and is surrounded by countries/armies sworn to its destruction, and therefore has no choice but to spend money on defense.

    India has the 3rd largest armed forces, with 1.3 billion active troops, and an additional 1.1 billion reservists.

    Facing only a cold (lukewarm?) conflict with Pakistan, India (as you alluded) chooses to spend money on defense, rather than on improving the economic, health and welfare of its population.

    As to the tone of the original article, both Israel and India have some amazing achievements of which to be proud, and I agree with the other comments regarding apples-to-oranges comparisons.

    Comment by Jack Poller | May 13, 2007

  21. Shefaly,

    @your comment no.15 – “it is a subtle difference that is lost on many, especially those who do not know me except thro my occasional comments on blogs”

    That…doesn’t sound humble at all. It sounds more like trying to cover your goofup and you did a lousy job at that. Normally people admit openly by saying “oops…I shot at my foot” and bite their tongue thro cool smileys in a sporting way…well, but then chivalry is not for wimps.

    In blogs, we meet a lot of smart people. Over time we may also be smart. Prejudgment is suicide. Assumption is hara-kiri. Get a few more snubs and all will grow up. Till then people waste time trying to build a larger than life image and the slower they are in correcting themselves, give more time for others to unravel them…completely.

    Bob Sutton and his character comes to mind…:)

    nobody has the time or inclination to `know’ or even wanting to. It’s all just hip shooting and over time people will try to be

    Comment by Krishna | May 14, 2007

  22. Sorry about the last sentence. It should read –

    Nobody has the time or inclination to `know’ or even wanting to know a fellow commentator. It’s a hip shooting space and we’ve gotta’ learn to hit the ground running. Do it fast, do it smart…that simply is it !

    Better luck next time.

    Comment by Krishna | May 14, 2007

  23. My humility is reserved for my origins and why I use the word ‘proud’ with qualifications, not for anything else. Even so I would not use Bob Sutton’s description on people I only converse with online – because that is not the opposite of humble, that is just lack of basic decency. Not that I care much for anyone thinks..

    Comment by Shefaly Yogendra | May 14, 2007

  24. Tut-tut !

    Comment by Krishna | May 14, 2007

  25. Shantanu I agree, in my disappointment 🙂 I overlooked that you were just trying to say that its a bad comparison. And Ms. HooHaa (ala al pacino) Yogendra 🙂 in your retort you overlooked the fact that I was not talking about the WHY but only talking about the same justifications being used over and over again by us Indians.

    Comment by Indiamusing | May 15, 2007

  26. “Just when I thought that I was out they pull me back in.”

    Comment by AL PACINO | May 15, 2007

  27. Jack: Sorry, for some reason your comment was mistakenly identified as spam. I have restored it at # 20.

    Everyone else: We may have more comments coming …I have emailed the link to TN Ninan 🙂

    Comment by Shantanu Bhagwat | May 15, 2007

  28. Hey Jack,


    Your Fund flow statement considers only application of funds, not Source. How much of the Israeli defense spend is met out of internal accrual and how much is funded by largesses and borrowings. Either way, you lose.

    If it’s met thro internal accrual (tax $) like India is forced to, we are wasting resources. It is systematic wealth destruction.

    If it comes from borrowings, we are miring ourselves in a debt trap. Sometime in future, the liability will come back to haunt us. Nobody gives anything away for free.

    If it comes from largesses in the short term, you are being misled. The millions of $$ Israel gets from overseas, goes back to buy ammo which is mostly US/European war exports. It’s just plain roundtripping of funds. You’ve to call that bluff and plug that leak sooner or else risk being taken for a royal ride.

    Realize that for US/European Arms factories, Asia is both (free) testing ground and market. If somebody tries to broker peace here, it’s bad for their business. They’ll go any lengths to keep the fire burning.

    Now do your math and get some perspective. Aren’t they all (India,Israel,Palestine,Pakistan and all) fools ? Wouldn’t you like them to reconcile their differences, see reason and grow up ? Imagine if these billions are spend on infrastructure, healthcare, education, ecology – would US / Europe stand a chance against Asia ? That’s the point.

    Comment by Krishna | May 16, 2007

  29. Jack,

    You said “Facing only cold (lukewarm?)conflict with Pakistan, Indian chooses to spend money on defense etc…”

    You seem to know little. Pakistan is a nuclear power, remember that. There’s this real threat of the nuclear arms falling in the hands of Islamic militants as acknowledged by its own Government, despite being a military dictatorship…! Courtesy – A.Q.Khan

    Check this out…

    So unlike Hamas / Hizbollah threat (though lethal) yet consists of suicide bombers,mortars, shells and rockets, we have to face threat from a NATION that’s a nuclear power, ostensibly an “ALLY-ON-WAR-ON-TERROR” (for US only) for which terrorism is an instrument of public policy, its raison d’etre !

    In those terms, it’s not even Apples to Oranges, Israel’s threat is relatively soft and $58 billion seems a bit far fetched.

    Comment by Krishna | May 16, 2007

  30. Jack, I think some things are clearer when compared fairly and accurately:

    Population: 7.1M
    GDP: $150B
    Defence budget: $68B (your number and I shall leave mentioning what % of this comes from the US as military aid etc.)

    Population: 1.0B
    GDP: $1T
    Defence budget: approx $20B

    Between India and Pakistan, four wars have been fought since 1947; further, between India and China, one in 1962, which was one of the largest wars of its kind fought in mountain terrains (in the world’s highest and most treacherous mountains). China’s defence budget is over $35B and its GDP is about $2.5T; China also contributed to the development of Pakistan’s nuclear arsenal. It is a losing game but each tries to keep up with their neighbours hence the ever escalating budgets. Given all this, it is moot whether the defence budget would otherwise definitely be diverted to basic education or anything similarly productive.

    Israel undoubtedly has better economic productivity per capita, but the complexity of governance in a very large democracy, dispersed over a very large geographical area, with nuanced and layered federated structures of governance all make India’s comparison with Israel a very poor one, a point on which you agree.

    PS: I think you meant the Indian forces were over 1M (and not 1 Billion!), but unlike Israel, there is no ‘draft’ in India. People serve ‘at will’ in the armed forces, and getting into the forces is no piece of cake.

    Comment by Shefaly Yogendra | May 16, 2007

  31. …and while on military spending:

    % of US GDP devoted to military expenditure: 4%
    Amount: $495.3B

    % of Saudi Arabia’s GDP devoted to military expenditure: 8.8%
    Amount: $25.4B

    (Source: International Institute for Strategic Studies)

    Comment by Shantanu | May 18, 2007

  32. […] P.P.S.  some critical opinions available on this at: […]

    Pingback by Comparing India and Israel | | May 20, 2007

  33. I wonder what Ninan has to say about Ireland, especially now that the Celtic Tiger has been reduced to a ‘bheegi billi’.

    Comment by Shefaly | April 14, 2009

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