By Justice Litle
When it comes to emerging markets, not all countries are created equal. Each has different strengths and weaknesses. Take the “BRIC” nations for example. Over the course of this year, China and India have been bruised and battered by sky-high oil prices, while Brazil and Russia have fared better.

This makes sense when you think about it. Russia is one of the top oil and gas producers in the world. Brazil, along with being an agricultural powerhouse, is on its way to big producer status, too (thanks to the Tupi oil field).

India and China, on the other hand, have to pay through the nose for their oil and gas needs. They also have to shell out big bucks for fuel subsidies, to keep the locals happy and avoid civil unrest.

So now that oil is backing off from its nosebleed heights, China and India are finding a bit more breathing room.

Authoritarian vs. Democratic

But it’s not as if China and India are peas in a pod, either. There are big differences there, too. China is more of a manufacturing economy, for one, while India is more of a service economy. China is also much more authoritarian, whereas India is loudly and colorfully democratic.

Some believe India is, in fact, too democratic... to the point of shooting itself in the foot with bribery, bickering and red tape. (Famed investor Jim Rogers has long been bullish on China but not so hot on India, and this has a lot to do with it.)

In China, when Beijing decides to do something, it simply gets done. In India, it sometimes feels impossible to get anything done. When China decides it needs a new airport or power plant or high-speed rail line, the powers that be just make it happen. In India, everyone has a stake and no one has final say. China can approve, plan and finish out a billion-dollar project in the time it takes India to get the first round of paperwork past the “license raj.”

This explains phenomena like the Pudong district in Shanghai -- a 21st-century financial center that seems to have sprung up overnight. It also explains why India still has a crumbling network of roads, airports and bridges that feel held together with duct tape.

But not all are convinced that China’s authoritarian overlay is a strength... or that India’s vocal love of democracy is a weakness. In the long run, regimes like the one in Beijing can be brittle -- more subject to cracking or breaking under stress. India’s messy system, on the other hand, is far more stable.

In India, leaders may come and go, but there is little threat of an entrenched elite throwing out all the stops to hold on to power in a time of crisis. The elite in Beijing haven’t yet faced a true crisis test.

India’s Big Win

The reason to bring this up now is because India just had a very big win on the political front.

India’s currency, the rupee, racked up its biggest gain in a decade on news that the government survived a confidence vote in parliament. (Indian stocks and bonds also shot up, giving the Bombay Sensex its best five-day run since 1992.)

The bottom line is that Manmohan Singh, the prime minister of India, is a reform-minded guy with a lot of good ideas. He understands free-market economics, he understands globalization, and he knows what to do to get India on track. Under Prime Minister Singh, India has enjoyed record economic growth.  Continued...