India ranked 43rd on IMD's World Competitiveness Index; Singapore on top

Highlights:

  • India continues to remain ranked 43rd on an annual World Competitiveness Index.
Details Analysis:
  • The Index has compiled by Institute for Management Development (IMD) with some traditional weaknesses like poor infrastructure and insufficient education investment keeping its ranking low.
  • Singapore has retained its top position on the 63-nation list.
  • Denmark has moved up to the second position (from 8th last year), Switzerland has gained one place to rank 3rd, the Netherlands has retained its 4th place and Hong Kong has slipped to the fifth place (from 2nd in 2019).
  • The US has moved down to 10th place (from 3rd last year), while China has also slipped from 14th to 20th place.
  • Among the BRICS nations, India is ranked second after China, followed by Russia (50th), Brazil (56th) and South Africa (59th).
  • India was ranked 41st on the IMD World Competitiveness Ranking, being produced by the business school based in Switzerland and Singapore every year since 1989, but had slipped to 45th in 2017 before improving to 44th in 2018 and then to 43rd in 2019.
  • While its overall position has remained unchanged in the 2020 list, it has recorded improvements in areas like long-term employment growth, current account balance, high-tech exports, foreign currency reserves, public expenditure on education, political stability and overall productivity,
  • However, it has moved down in areas like exchange rate stability, real GDP growth, competition legislation and taxes.
  • In a less global world, with China, USA, and Europe looking inwards, currencies like the rupee (and the Brazilian real for instance) are going to suffer and display high volatilities.
  • With the exception of Singapore, the Philippines, Taiwan and the Korean Republic, most Asian economies dropped in rankings this year.
  • The reason for the Asian economies' less stellar performance as a region, this year is partly the result of the trade frictions between China and the US, particularly because these economies are highly dependent on trade with China.
  • The impact of COVID-19 on the competitiveness ranking has partially been captured by executives' opinions about the effectiveness of the different health systems.
  • In the ASEAN countries included in the survey, only Singapore and Thailand have a positive performance in the effectiveness of the health infrastructure.