IMD World Competitiveness Rankings 2019

India has moved up one place to rank 43^rd most competitive economy in world in annual competitiveness rankings compiled by International Institute for Management Development (IMD).

Key Highlights

• India: has moved one notch higher to 43th rank (from its 44th position in 2018, 45th in 2017 and 41st in 2016.) in terms of competitiveness worldwide. This improved rank is result of India’s robust economic growth, a large labour force and its huge market size.
• Singapore: The competitiveness chart was topped by Singapore that has toppled the Hong Kong and the United States to to take the top spot among the world’s most competitive economies. Singapore has grabbed top position for the first time in nine years. In 2018 it stood at third rank.
• US: The US slipped to the third place in 2019 edition of the IMD World Competitiveness Rankings.
• Hong Kong: Hong Kong Special Administrative Region (SAR) has held onto its second position same as last year. This rank was due to countries benign tax and business policy environment and access to business finance.
• Asia-Pacific: As per the study Asia-Pacific region has emerged as a global beacon with 11 out of 14 economies (that were studied) either improved or holded onto their ground.
• Saudi Arabia: is the country that made its mark as the biggest climber of 2019. It advanced 13 places from 2018 currently to No. 26 this was due to strong investment in education.
• Venezuela: embattled in turmoil hit by inflation, poor access to credit and a weak economy finished in last place.

About IMD World Competitiveness Rankings

• The rankings were first started in 1989.
• It ranks 63 economies on 235 indicators which are incorporated from each of these economies. The indicators are used to evaluate country’s ability to foster an environment where enterprises can achieve desirable sustainable growth, generate employment and increase its citizen’s welfare.
• Gauge: The International Institute for Management Development (IMD) Business School takes into account a wide range of statistics and hard data such as unemployment, GDP and government spending on health and education as well as soft data from an international business executive opinion survey on topics such as social cohesion, globalisation and corruption.
• Categories: The economies were judged in four categories

1. Economic Performance
2. Infrastructure
3. Government Efficiency
4. Business Efficiency.

Way Forward

In the IMD 2019 rankings, although India has scored well on several economic parameters and tax policies but it still lagged in terms of education infrastructure, societal framework, public finance, health and environment. Thus challenge before India remains to address digital literacy and internet bandwidth in rural areas, to maintain high growth with employment generation, proper implementation of Goods and Services Tax (GST), managing fiscal discipline.

Month: Current Affairs - May, 2019