New Delhi: India has dropped 10 positions, ranking 68 out of the 141 economies surveyed, in the World Economic Forum’s (WEF’s) Global Competitiveness Report for 2019.
Although the drop in India’s ranking is dramatic, its overall score on the Global Competitiveness Index (GCI) has gone down by only 0.7 points.
The report, released Wednesday, attributes India’s poor competitiveness to weak performances in “information and communication technology (ICT) adoption”, “diversity of workforce”, “meritocracy and incentivisation” and “skills”.
The country has, however, performed well on certain indicators such as “market size”, “future-oriented government”, “shareholder governance”, and “renewable energy regulation”.
For the record, Singapore has beaten the US to top the 2019 list. The two countries are followed by Hong Kong, Netherlands, Switzerland and Japan.
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Other economies perform better
One of the reasons for India’s drop, the WEF says, is that a number of other economies have performed way better. “A number of similarly-placed economies including Colombia, South Africa and Turkey improved over the past year and hence have overtaken India,” the report states.
India has also fared poorly when compared to other G20, BRICS and South Asian countries.
Among the G20 countries, India has one of the least competitive economies, only ahead of Brazil and Argentina who are at the 71st and 83rd spots respectively. Similarly, among BRICS countries, India is only ahead of Brazil.
India’s relatively poor performance among its South Asian peers is especially significant.
“In South Asia, India, in 68th position, loses ground in the rankings despite a relatively stable score, mostly due to faster improvements of several countries previously ranked lower,” the report states. “India is followed by Sri Lanka (the most improved country in the region at 84th), Bangladesh (105th), Nepal (108th) and Pakistan (110th).”
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Some silver lining
For its competitive index, the WEF ranks countries based on 12 indicators and several sub-indicators. Some of the indicators include institutions, infrastructure, ICT adoption, macro-economic stability, skills, financial system, labour market and business dynamisms among others.
“India ranks beyond 100th on five pillars (indicators) and features in the top 50 of just four pillars (indicators),” says the report.
The silver lining for India here is its extremely attractive large market size. The Indian economy is ranked as the 3rd best in terms of market size. Following market size, India has done reasonably well in innovation capability (35th), financial system (40th) and macro-economic stability (43rd).
The report specifically talks about India’s good performance in terms of its financial system and innovation capability. “It’s financial sector (40th) is relatively deep and stable despite the high delinquency rate (10 per cent of the loan portfolio, 106th), which contributes to weakening the soundness of its banking system (89th),” notes the report.
When talking about its innovation capability, the report notes that India “does punch above its development status when it comes to innovation, which is well ahead of most emerging economies and on par with several advanced economies”.
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Needs considerable improvement
Except for the four aforementioned indicators, India has performed poorly across all the remaining ones.
For instance, among the 141 countries that have been surveyed, India ranks 120th in ICT adoption, 110th in health, 107th in skills, 103rd in labour market and 101st in product market.
These make up the bulk of the chronic issues with the Indian economy.
“Health conditions remain poor, as reflected in low healthy life expectancy (59.4 years, 109th), which is one of the shortest outside Africa and significantly below the South Asian average,” says the report.
“Product market efficiency (101st) is undermined by a lack of trade openness (131st) and the labour market is characterised by a lack of worker rights’ protections, insufficiently developed active labour market policies and critically low participation of women (ratio of female workers to male workers of 128th),” further notes the report.
While not as poor, but India seems to be hovering in the mid-way mark for the remaining indicators. It ranks 59th in institutions, 69th in business dynamism, and 70th in infrastructure.
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A news report published on 9 October 2019 has relayed the opinion of IMF Chief Kristalina Georgieva on global economy in the present year 2019. She is reported to warned that global economy is witnessing “ synchronized slowdown” which will result in slower growth in 90 percent of the world in 2019. And she is reported to have further warned that effects of global slowdown may be more pronounced in India during the year 2019. In this context , it is apt to refer readers to this Vedic astrology writer’s predictive alerts covering , among other aspects , economy also for more care and appropriate strategy in hitherto well-known article – “ The year 2019 astrologically for India” – published at theindiapost.com , as early as last year 2018 on 7 October. Briefly speaking , slowdown likelihood in economic and financial sector for India was clear in the alert of said article. Similar alert was sounded by this writer through another article – “ World trends in April to August 2019” – brought to public domain widely in March and subsequently on 5 April 2019. Now , in the remaining three months of 2019 and first half of coming year 2020 looks to be not making any difference , rather scenario looks to be getting serious during April to June , 2020 , calling for more care and appropriate strategy. It seems second half of 2020 may attempt to address some of worrisome concerns to “ an extent” with some success.
Modi get economy from 118 th postion to 58th position now from 58th to 68th again
Hmm…it’s rather true that non of the previous governments including present one has done much to improve export oriented businesses in our poor country. We definitely need more dollars to attract more fdi.
UNFORTUNATE !!!
COUNTRY’S BACKBONE: BUSINESS, EMPLOYMENT & PEOPLE’S HARD EARNED MONEY IS BEING LOOTED IN SHARE MARKETS, RESERVE BANK OF INDIA’S “RESERVES” ARE GONE & MANY MORE ??? BUT WE FOOLISH PEOPLE ARE FED WITH RAM MANDIR, KASHMIR, PAKISTAN,NRC, & HINDU- MUSLIM RIFT.
This Government is beaten left to right by all media outlets with regard to handling economic matters.
Very sorry state for BJP indeed!
Reservation Zindabad. We need reservation close to 95% to achieve the goal of 141st rank.
Our children’s Singapore leads the world.
As usual the title makes for more confusion than clarity of communication. When BRICS consists of only 5 countries, how can India slide 10 places down? The reader has to wade through the article to discover the intended meaning. The author should have stopped with “India drops 10 places on global competitive index.”
Work on your English comprehension skills. The title is quite clear. And yes, the expectation is that one reads the article before commenting.
Socialist Modi Murdabad