Socialism is a newer form of communisn. What China (or WB/Kerala) are following is even more modern communism. They have changed over the time. There is nothing wrong with that - every thing needs to change over time. The so called captalist countires are all not so purist - they too give lot of social protection to their people - they too protect their own companies when there is internation competetion.
The absence of communism or presence of capitalism doesn't ensure prosperrity.
These are two different ways of a nation to prosper. You need to follow it right way to succeed - it doesn't matter what you follow.