India maintained 43rd rank on an annual World Competitiveness Index compiled by the Institute for Management Development (IMD) that examined the impact of COVID-19 on economies around the world this year.
The 64-nation list was led by Switzerland, while Sweden has moved up to the second position (from sixth last year), Denmark has lost one place to rank third, the Netherlands has retained its fourth place and Singapore has slipped to the fifth place (from first in 2020).
At eighth, Taiwan reached the top-10 for the first time since the ranking began 33 years ago (moving up from 11th last year). The UAE and the USA remain in their same spots as last year (9th and 10th, respectively).
The top-performing Asian economies are, in order, Singapore (fifth), Hong Kong (seventh), Taiwan (eighth) and China (16th).
The IMD World Competitiveness Ranking ranks 64 economies and assesses the extent to which a country promotes the prosperity of its people by measuring economic well-being through hard data and survey responses from executives. This year, the rankings expose the economic impact of the pandemic across the globe.
Among the BRICS nations, India is ranked second after China (16), followed by Russia (45th), Brazil (57th) and South Africa (62th).
India has maintained its position for the past three years but this year, it had significant improvements in government efficiency, IMD said.
“India’s improvements in the government efficiency factor are mostly due to relatively stable public finances (despite difficulties brought by the pandemic, in 2020 the government deficit stayed at 7 per cent) and to the positive feedbacks we registered among Indian business executives with respect to the support and subsidies provided by the government to the private companies,” IMD said.
It, however, added that the short term performance of India’s economy will depend on its ability to address the pandemic.
The report finds that qualities such as investment in innovation, digitalisation, welfare benefits and leadership, resulting in social cohesion have helped countries better weather the crisis the best and thus ranked higher in competitiveness.
The report said top-performing economies are characterised by varying degrees of investment in innovation, diversified economic activities, and supportive public policy, according to the experts at the World Competitiveness Center.
“Strength in these areas prior to the pandemic allowed these economies to address the economic implications of the crisis more effectively,” the report said.
Competitive economies succeeded in transitioning to a remote work routine while also allowing remote learning. Addressing unemployment has been fundamental.
Countries that ensured the effectiveness of key public spending, such as public finance, tax policy and business legislation, are seen as essential policies to relieve the pressure on the economies hit by COVID-19, the report said.
The ranking, produced annually by the IMD World Competitiveness Center, measures the prosperity and competitiveness of 64 nations by examining four factors — economic performance, government efficiency, business efficiency, and infrastructure.