Highlight the standings of various countries in the Global Competitiveness Index, 2019. Discuss the factors which led to decline in the rankings of India.
The World Economic Forum (WEF) has released the annual Global Competitiveness Index for 2019.
Global Competitiveness Index 2019
- Singapore replaced the US to take over the first position.
- The US was pushed down to the second position and was followed by Hong Kong SAR in 3rd, Netherlands in 4th and Switzerland in 5th positions.
- India has moved down 10 places to rank. Countries like Colombia (57), Azerbaijan (58), South Africa (60) and Turkey (61) surpassed India in this year’s survey.
- In the South Asian region, India is followed by Sri Lanka (84), Bangladesh (105), Nepal (108) and Pakistan (110).
- China’s position at 28 has remained unchanged from last year’s survey.
How India performed in various parameters?
- India ranks below 100 on five parameters and features in the top 50 in just four.
- India ranked high on macroeconomic stability (43) and market size (3).
- The report notes that India’s financial sector (40) is relatively deep and stable despite the high level of loan defaults (106), which contributes to weakening the soundness of its banking system (89).
- India has performed well when it comes to innovation (35). In innovation India was ahead of most emerging economies and was on par with several advanced economies.
- There were major shortcomings for India in some of the basic enablers of competitiveness like ICT (information and communications technology) adoption is limited (120) but has improved sharply by 8 positions since the 2017 edition.
- India had mixed results on various aspects of governance (59).
- India’s rankings under Transport (28) and electricity (103) infrastructure have improved significantly over the past two years, though from a low base.
- The health conditions remained poor in India. This was reflected in low healthy life expectancy (59.4 years, 109th). It was one of the shortest outside Africa and significantly below the South Asian average.
- In India product market efficiency is undermined by a lack of trade openness 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.
- India had a poor ratio of female workers to male workers (0.26). India has been ranked very low at 128th place.
The WEF has said even though the drop of 10 places in India’s position to 68th place looks dramatic, the decline in India’s competitiveness score is relatively small. A number of similarly-placed economies including Colombia, South Africa and Turkey have significantly improved over the past year and have overtaken India.