The term “Third world” was coined during early 1950s by Alfred Sauvy, a French economist in his writing on L’Observateur magazine about masses. Before the French revolution, third world represented weak politics, alarming economic poverty and social marginalisation. During the cold war, the term identified the countries which were reluctant to associate with either the first world affiliation to capitalism or second world affiliation to communism and Soviet Union. The third world countries were nations from Asia, Africa and Latin America which kept a distance in the non-alignment movement from communism and capitalist affiliation (Ross, 2016). Although the cold war came to an end, the term third world has not lost its relevance, and it is a central word in social sciences in referring to the developing countries. However, questions on the validity of the Third World use has been made basing on the gradual improvement in world politics as well as tremendous differentiation among many third world states over the past decades (Berger, 1994).
Conversely, the demise of the cold war led to a subsequent loss of meaning in first and second world concepts, but third world concept has clung to its meaning. Further, (Vandall, 2000) postulates that the continuous use of the term third world is meaningless considering the numerous political, economic and social liberations across Asia and African nations during the 21st century. Therefore, this paper aim to prove beyond doubts that the third world concept is relevant however the overall generalisation of underdevelopment in third world countries especially India and China is baseless considering the recent robust impacts Asian countries have on world trade.
Overview
In the dawn of globalisation, many third world nations got a chance to trade globally thus realising economic growth and improvement in living conditions, Asia and China are not to an exception. The dual countries have become giant exporters in manufactured goods among other commodities thus gaining recognition from world trade organisation (Matsushita et al., 2015). According to the financial times, the economic rise of China and India has transformed the global political and economic wavelengths to influential modern economies. However, these countries have struggled in both internal and global arena in an attempt to meet the global production levels. With the rise of industrial capitalism, countries focused on structuring the domestic markets to fit exporting criteria and making proper arrangement with the working class to possess national monopolies. Nevertheless, the dawn of globalisation and the advancement in technology lead to cross-border trade accompanied by overseas direct investment as well as direct flow of capital across a broader network(Gay, 2016).
The third world countries, however, have different growth transformational scenarios emanating from their different economic history and culture which determines the ease to penetrate to the global economy. China has pose a great threat to the developed nations as a competitor in the export sector. China has overtaken all sectors in producing quality commodities worth global recognition thus liberating itself from the generalisation of poor third world countries (Grindle, 2017). China and India are focusing more on surrendering imperialism alongside making political and economic transition focusing on uplifting the majority of middle-class and developing a technologically advanced economy with the capacity to sustain a decent living standard. The idea seems to be attractive, yet a lot of planning need to be underway to facilitate the transformation of lower income earners to have a decent income in both India and China. According to (Fägerlind and Saha, 2016) achieving a vast economic growth increases a nation’s capacity to transform the society at large bringing forth democracy and justice in all sectors.
China
The third world concept is viable when it comes to China since it has for long time fought against imperialism as well as communist revolution which resulted to state intervention on economic development matters. Although China is a third world country, it would be wrong to generalise the notion that third world countries are poor and underdeveloped. China is one of the strongest upcoming competitors in producing high-quality export commodity as well as in making contractual agreements with other nations in Africa and the rest of the world. Despite the global economic integration with high network of trade among nations, China has been vigilant in retaining control over its economy through strengthening its control over state finances to avoid indulging in dictated structural adjustment (Harris, 2016). It is clear that Chinese leaders envy to trade globally as independent affiliates of global capitalist class owing no debts to other nations. The Chinese communist party has brought tremendous change from socialist mindset to a national project that yield hundredfold in achieving national heritage and reasonable global market share. Although vast multinational profits challenged the Chinese communism, Yun Yong Samsung CEO makes it clear that Chinese leaders are more accommodating to multinational investors by the foreign capital drawn where foreign direct investment amounting to 38% of the gross domestic product and 6% for India (Blomstrom, 2014).
Industrial revolution has driven the rural population to work in urban areas for higher wages, a move that has lead to massive growth of Chinese economy. However, among the nine million people living in rural areas are expected to move to the cities over a decade to come. The demand to house and the urban population is an indicator that China's economy is furthering its growth to unbelievable levels and will be the world highly populated country. For instance, Shanghai GDP amount to $80 billion similar to Hungary while Tianjin port city holds approximately four thousand companies among them top rated transnational like Samsung, Nestle and coca-cola (Mastel, 2016).
Furthermore, China has concentrated on developing its future economy, therefore, attracting transnational to sell in China as the third largest importer as well as exporter of manufactured goods. China achieved a 70% of world export surpassing Japan which has dominated the export sector, especially on vehicles. On the other hand, US have surrendered $ 500 billion to China since the dawn of 21th
century, therefore; China has becoming the heart of global sustainable economy replacing US and Japan (Blomstrom, 2014).
As a third world, China has made profound integration in the fuel industry where she has attracted Shell energy in a $4.4 billion contract, a deal that will have a capacity to produce almost $2.5 million tons earning a $2 billion revenue with 80% of labour emanating from China. To add on the transformation, Germany and Britain have partnered with Chinese petrochemical to satisfy the population need on industrial chemicals (Mastel, 2016). Moreover, Chinese IT sector has advanced to considerable levels making about 20% high-tech export. A good example of high tech producer being Dell and Motorola which have made China to be a champion in the export of technological devices alongside Huawei technologies which have expanded to sell in forty countries among other electronic enterprises.
In summary, the surfacing of Chinese capitalist class aims to expand domestic and foreign investment. China has shown to focus much on foreign investment thus operating for multinational corporations on a joint venture. However, China as a third world country has maintained independence despite its penetration to the global economy and has created an avenue for partnership in the transnational economy thus earning worldwide recognition in globalisation.
India
India has struggled with static development in the reign of Bharatiya Janta Party (BJP. With the rise BJP, India struggled to shape nationalist development due to the extreme ethnic policies based on religious association that is Muslims and Christians. Nevertheless, BJP party leader Vajpayee made an international move to expand economic attachment with China and Brazil as a concern to adhere to the world trade organisation. Vajpayee move to privatise state-owned industries in a neo-liberal manner lead to great suffering of the majority rural population (Gay, 2016).
Conversely, small-scale Indian farmers dominates the agricultural sector where 60% use farm hand tools while 40% utilise farm machines, therefore reforms on agriculture were hard to achieve due to the immense fear of the poor masses lose their land to urban mechanised lands. The bitter rural population voted in the Congress party which focused on accelerating the transnational capitalist in India. The aftermath of Congress party was a great civil employment and the emergence of state-sponsored firms. As a third world country, India took a proactive approach to combat any affiliation with either first or second world countries. Additionally, the communist party of India made a profound impact in promoting national cohesion and advocating on global economic growth. However, The Congress party was vigilant in its neo-Keynesian approach to ensure that the rural economy acquired the necessary development (Gay, 2016).
Despite the domestic hurdles, India managed to enter the global economy after making rapid progress in pharmaceuticals and information technology. India has become a point of focus for US in sourcing IT experts although it offers low opportunities for direct investment, unlike their Chinese counterparts. India offers high wages to the ten million workers in the manufacturing sector exporting $60 billion as opposed to the $400 billion Chinese export. In spite of the continuous lag in export, India is among the leaders in high-class education on information technology making it a point of reference in outsourcing IT specialists. Studies have revealed that US outsourcing on experts from India is projected to rise within the next five years to a considerable amount of $70 billion and 10% accredited to Indian GDP. In the recent, 500 foreign countries are outsourcing for contracts worth millions from India (Gereffi, 2017). Globalisation has taken route between India and China for mutual benefits where 20 Indian technology firms account for 45% of China exports while China making huge investment in India with Huawei setting up a $100 million project in Bangalore.
Many developed countries like the united state are making contractual agreements through merger and acquisition in the information technology sector. US transnationals have manoeuvred their way to China a good example being IBM which took over Daksh one of the biggest call centre after securing a ten years contract to run Bharti Tele-venture technological needs. Further, India has tremendously invested many resources in engineering and automobile, and it is becoming a focal point in global supply chain on the lower skill scale of manufacturing. Maruti, an essential manufacturer in India though owned by Suzuki in Japan, can produce quality auto components thus posing a threat to other manufacturers due to its increased popularity. Bharat has become the largest manufacturer of front trail axle has secured to operate in Europe making 80% sales globally (Blomstrom, 2014).
The term Third word about India is worth defending basing on the great effort India has endured in an attempt to liberate itself from the underdevelopment and poor living condition to improved economic and social for global interconnectedness. As a third world, India is gradually securing independence through its advancement in engineering as well as information technology sectors not forgetting the great achievement in attaining quality wages for the large number of middle-income industrial workers.
Conclusion
After the cold war, third-word concept was used to refer to those nations which failed to take sides in the capitalist and communism associated to first and second world countries. Moreover, the term is also associated with underdeveloped countries with poor sanitation and deprived living standards. Third world countries referred to The Asian, Africa and Latin America nations. However, generalising that third world countries are poor is baseless since China and India have made commendable milestones in world trade as well as raising the population living standard. China has become a great competitor in the global transnational trade and major exporter of manufactured commodity. Likewise, India has become a point to source for IT expert on top of being a vigilant player in the global value chain. The two countries have retained their economic independence due to the utilisation of transnational capitalist class with an aim to get a undisrupted chance to have multinational recognition in global trade arena. Therefore China and India economic independence is a clear reflection of third world while the tremendous improvement in the living standard combating poverty is a sure bet that the two countries are not underdeveloped but rather they are developing countries with the capacity to surpass the developed nations the likes of United state.
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