He was born at the low ebb of Chinese civilization - after the Opium Wars, and the Boxer and Taiping rebellions - when Chinese resistance had exhausted and the Doors to China were open to western imperialism, and China was prey to chronic famines, greedy warlords and greedier imperialists. He died as China was emerging an economic giant and a super-power.

Deng was seven years old in 1911 when Sun-Yat Sen led the national revolution that overthrew the Manchu dynasty and inaugurated the Chinese Republic marking China's break from the past. That revolution failed to build a modern state but ignited the spirit of the younger generation of revolutionaries, among them Mao Zedong and the aide he nicknamed as the little man in a hurry.' Deng joined the Chinese Communist Party in 1924 and in 1931 Mao's Red Army in Jiangxi.

He was on the Long March (1934-1935) - the Red Army's epic trek through 13000 km, 18 mountains and 24 rivers of enemy infested territory - memorably described in Edgar Snow's classic Red Star Over China. He was there in 1949, as a founding father of the second republic, the People's Republic of China. During the cultural Revolution (1966-76) his fortunes fluctuated. In 1967, he was purged and exiled to Jiangxi, in 1973 rehabilitated as Vice Premier, in 1976 purged again. In 1978 began his climb to the top when at the 3rd plenum of the 11th Central Committee his reformists faction took control of the party.

Deng Xiaoping was already 78 years old when he had the power to formulate policy. There was perhaps a capitalist streak in his Sichuan peasant genes. He was surely a pragmatist and a ruthless one. "Whether a cat is black or white makes no difference", he claims to have told Mao while arguing for economic reforms, "as long as it catches mice it is a good cat." Deng's "socialism with Chinese characteristic" entailed applying market tools to China's state-owned economy - freeing prices. permitting profit incentives, promoting competition, and trading globally.

The timing was right. Deng's reforms hit fertile soil. China was ready for innovations. A vast infrastructure was in place, a literate and skilled population was eager to get back to work after the depredations of the Cultural Revolution, people were wearied by ideological mystification and keen on pragmatic solutions and material well-being, the intelligentsia was intent on rejoining the economy with the skills it had to offer.

Two decades later the results appear astounding. Never before in human history had such a large population - 1.2 billion - improved its living standards so dramatically in such a short time. Never before had so rapid and unexpected a shift in world configuration of power been witnessed in peace time. China's economic growth since 1978 has averaged 9%. Per capita annual income has tripled to more than $1000.00 in rural China, and a lot more in the urban areas. China's impoverished and austere collective society is now in the throes of fevered consumerism. In 1979, Wo of Chinese households owned television, in 1995, 90% owned colour sets. In 1979, virtually no one owned a private car. Today 2.5 million families do, and demand continues to outstrip supply.

Individual affluence is still far from comparable in China to advanced industrial countries. But its economy, being one of the world's ten largest, has advanced from the third to the first world, and unlike most first world economies it is rapidly growing. In 1995, China's foreign exchange reserve stood at $79 billion. In 1996, it was $130 billion. In 1995, it had a trade surplus of $30 billion against the United States, in 1996, this surplus increased to $38.5 billion. Foreign investors compete to invest in China; the foreign capital inflow in 1996 alone was a whopping $50 billion. Nearly half of the world economy is in East Asia today. China alone can keep advancing this trend. Its weight will be greater when Hong Kong rejoins the mainland in July.

By the middle of the 21st century China may become the world's dominant power. Because the stakes are so high all eyes are on China. There are land mines ahead. "To get rich is glorious" was a Deng favourite. But there is trouble when the glory is not equitably distributed. China's economy runs on four tracks - state, collective, private, and foreign sectors - which insures uneven development. Pockets of misery can serve as strategic time bombs among more than a billion people.

Unemployment has raised its ugly head in a country committed to full employment. Some forty millions of China's 147 million industrial workers are jobless. The Ministry of Labour projects that unemployment will reach 260 million in a decade. A third of the state enterprises lose money and are unfit for privatization. If they are shut joblessness will increase; if they are not incompetence is rewarded. Corruption is rampant and reaches high echelons, including Deng's immediate family, putting into question the credibility of the government and party. Living standards are dismal in the remote and outlying states such as western China where the Muslim populace has been suffering from a protracted cycle of rebellion and repression.

The long list of China' actual and potential problems leads the western media and experts to project gloomy scenarios of its future. Among those problems are the possible leadership vacuum and infighting, an increasing gap between political and economic development, and resistance of Chinese leaders to liberalizing the polity. These warnings may be exaggerated.

To an extent they reflect frustration over Chinese disregard of western models and advice. In contrast to Russia, China's reform agenda developed indigenously, from ideological struggles inside the party. Take the cases of Hu Yaobang and Zhao Ziyang. These two of Deng Xiaoping's three chosen successors lost out because they favoured western models. Said Deng, their erstwhile ally: "Both men failed and it was not because of economic problems. It was on the question of not opposing bourgeois liberalization that both men came a cropper."

The third man, Jian Zemin (70) replaced Zhao Ziyang in 1989 as provisional general secretary of the Communist Party. Thenceforth, with Deng in the background, a leadership transition began under his watchful eyes. In 1992, the former mayor of Shanghai was confirmed at the party's helm. In 1993, Jian Zemin became president and chief of the armed forces. He leads with a politburo that has been governing China for nearly five years. They include: Prime Minister Li Peng (69), adopted by the redoubtable Zhou Enlai after his father was killed by the Kuomintang. Qiao Shi (72) is the president of the parliament. Zhu Rongji (68), Vice Premier and incharge of economy, after Jian Zemin he was mayor of Shanghai where he defused the 1989 protest movement without bloodshed, Liu Huaqing, at 81 the only veteran of the long march in the politburo. Li Ruihan (63) a carpenter and model worker of moderate leanings and broad following. And Hu Jintao (55), once a protege of the reformist Hu Yaobang. Reform minded and grass roots party leaders predominate in the ruling apparatus. It is unlikely that they will produce a crisis of succession. Foreign analysts are justified in arguing that the contrast between rapid economic change and unchanging structures of politics normally constitutes a fundamental cause of political instability. But here too they may be underestimating the importance of changes that have already occurred in China, and its leadership's will and capacity to adjust to them in thoughtful and planned ways rather than in the knee-jerk fashion that proved so fatal to the Soviet Union. Economic liberalisation has necessarily weakened the Communist Party's regulatory powers, and constricts its control mechanisms as labour gains mobility and employers acquire autonomy. In rural areas, the commune system is largely dismantled leaving the party apparatus without its former role. The fast growing economy has necessarily decentralised, shifting many decision making functions from the centre to the provinces, and from province to local administration and party organization.

As a consequence of economic liberalization, the Party's role as the central planner of the economy has inevitably diminished. shrill noises notwithstanding, there is more freedom and greater grass roots democracy and perhaps less human rights violation in China today than in such American favourites as Indonesia, Korea and Israel, a sectarian 'democracy' where rights of citizenship are defined by race and religiously. Contemporary China does, nevertheless, confront challenges of political and structural reforms which can be ignored only at a peril.