In the second of a three-part series, BBC Diplomatic correspondent James Robbins assesses their prospects during visits to the commercial capitals, Mumbai and Shanghai.

The moment you arrive in China, the country shouts progress.

India cannot compete with China's bulk, standard steel production

China's one-party state is out to prove a point: "We're overtaking the rest of the world."

India, too, is on a dash for growth and riches, but it doesn't always look that way. Travelling into this other vast city can be exasperatingly slow. The roads into Mumbai are among the worst in any major world city.

Powerful tale

Democracy has not delivered the transport, the infrastructure which India so desperately needs.

It is true that things are changing, but too slowly. But how does it look to those creating the new wealth?

In Shanghai, I met Billy Wang in the workshop where he and his staff turn out hand-made shoes. The business tells a powerful tale.

Billy Wang's business is growing fast

The business is expanding very fast - like almost all Chinese manufacturing - and Mr Wang certainly doesn't question China's rigid political system which helps make him rich.

"According to the Chinese way of thinking, the political system is decisive. Everything else comes second to this," he said.

And that is true when you see the big picture of China, too.

At Shanghai's international port, it is largely one-way traffic. China doesn't buy much overseas - so most containers arrive in the country empty - but they go out crammed full of exports.

China is manufacturing in fantastic quantities, and selling hard. The world has good reason to worry about the growing trade imbalance.

Risk-takers

China's achievement is simply staggering. Single-minded one-party government making clear decisions has delivered unprecedented wealth to an expanding middle class, and rising incomes for most of China's people, even if millions are still trapped in rural poverty.

But in India, I found that young risk-takers opening new businesses are not dismayed, even if they are very aware of the fierce competition from neighbouring China.

Tarun Thadani is undeterred by competition from China

Tarun insists India can beat China by combining cheap labour with design skills.

"We never copy anything directly," he said. "The key is consistent new development. We spend so much time trying to make new styles. Originality is the key."

So what about the big picture of India?

I found that stress on skills drives heavy industry too. Outside Mumbai, at Mukand Steel, they know they cannot compete with China's bulk, standard steel production.

Instead, they make only high-value specialist steels, meeting Europe's most exacting standards and specifications.

This is an area of heavy industry where the Indians are convinced they have a huge edge over China - even if it is something of a niche market and will never deliver enough jobs to satisfy India's hunger for rapidly increased employment in manufacturing.

The only certainty is that both countries will go on racing each other and overtake most of the outside world.



India has a vibrant, free press, and a very vibrant cinema, both Bollywood films and the whole range of international movies.

It all raises the question: Could India's democracy prove an eventual winner against China's lack of political freedoms?

For Billy Wang the Shanghai shoemaker, despite China's population - freedom is heavily restricted.

Dizzying change

Most, not all, international films get an airing. But newspapers, TV and radio, and the internet are all strictly controlled. Any dissent is punished harshly but if a growing middle class in China demands freedom to match its rising wealth, then China could hit very real trouble.

So where are Billy and Tarun heading?

Both their cities are rising at a dizzying rate. But I am clear that India lags far behind for now, at least. Democracy, the need for public consent, just isn't delivering change so quickly.

But then in China, with no need for consent, the risks of major political upset seem much greater.

The only certainty is that both countries will go on racing each other and overtake most of the outside world.