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India Gets Even More Un-Competitive, Falls To 60th Position Worldwide: WEF

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We call India a developing country, we even term her as the next super-power, but in actual reality we seem to be moving backwards rather than forward if World Economic Forum’s report is to be believed. According to WEF’s Global Competitiveness Index  for 2013-14, India has fallen further and now ranks 60th most competitive economy in the world.

Here is how India’s competitiveness has fallen in last 5 years:

Year India’s Competitiveness Rank
2009 49th out of 133 economies
2010 51st out of 139 economies
2011 56th out of 142 economies
2012 59th out of 144 economies
2013 60th out of 148 economies

There are 3 main factors which largely contribute to India’s slide – Inadequate supply of infrastructure, Inefficient government bureaucracy and Corruption. Not only this year, but in all previous years these 3 factors have been biggest problematic areas!

Most problematic Areas!

It is interesting to note that while India’s GCI (Global Competitiveness Index) score has remained constant at 4.3 (on a scale of 7), but the fall in rankings have come because other economies have increased their competitiveness.

GCI

Factors with Best / Worst Rankings

The GCI index comes up with the rankings based on nearly 106 different factors. Here are the top 10 best and worst individual factor rankings.

Best Factors

Sr. No Factor Rank (out of 148)
1 Local supplier quantity (Business Sophistication) 2
2 GDP (PPP$ billions)* 3
3 Domestic market size 3
4 Foreign market size 4
5 Available airline seat km/week, millions 13
6 Available airline seat km/week 13
7 Availability of scientists and engineers 15
8 State of cluster development (Business Sophistication) 16
9 Financing through local equity market 18
10 Quality of railroad infrastructure 19

Worst Factors

Sr. No Factor Rank (out of 148)
1 Government budget balance 140
2 Women in labor force, ratio to men* 137
3 Inflation, annual % change* 130
4 No. procedures to start a business* 129
5 Total tax rate 128
6 Trade tariffs, % duty* 128
7 Exports as a percentage of GDP* 125
8 Mobile telephone subscriptions/100 pop.* 123
9 Infant mortality, deaths/1,000 live births 120
10 Individuals using Internet 120

If you notice the top 10 best and worst factor rankings, it is quite clear that India ranks quite well when it comes to her market size and financial markets development. In general even on health and primary education the rankings are decent.

However, when it comes to Infrastructure, current economic environment, business sophistication, technological readiness or even innovation India ranks quite poorly.

Surprisingly, India ranks quite lowly (123 out of 148) even with the huge mobile subscription base that she has.

It is also quite sad to see that internet usage is extremely low in India, a country which is a leader in Software development services!

What is your take on these rankings?

[WEF GCI Pdf report]

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