India falls 10 places in Global Competitive Index as others race ahead in technology
- India slipped ten places in the
Global Competitiveness Index, ranking at 68.
- The country’s ICT technology innovation capacity is growing but isn’t backed by investment in human capital.
- India’s overall score is relatively stable but countries ranked near India demonstrated more growth.
Despite these strides, India fell 10 places in the World Economic Forum’s (WEF) Global Competitiveness Index, ranking at 68.
India’s slip in the rankings is only partially because of the fall in its score — a drop of 0.7 points.
The report notes that a greater factor may have been because other countries — which were previously ranked lower on the Global Competitiveness Index — have shown faster improvement, especially when it comes to the adoption of information and technology.
India has improved significantly since 2017, but information and communication technology (ICT) continues to remain a challenge due to underlying factors like women participation in the workforce and weak workers’ policies.
India and other emerging economies are also showing signs of stagnation and slowdown since their growth has largely been ‘anaemic’ — or unequal.
India’s mixed results
More ICT means more innovation, according to the WEF. In order to deal with the growth of their innovation capacity, emerging economies — like China, India and Brazil — need to strengthen their skills and labour market.
Technological integration is good on paper. But, without human capital investment, it remains largely inadequate.
India performed well in terms of innovation, ranking 35th in the world. But, it falls short when it comes to other foundational enablers of competitiveness on the Global Competitiveness Index.
The one thing that does work in India’s favour is its market size. Even its financial sector ranks better than most other countries despite the high delinquency rate — that’s not to say that the banking system has not weakened.
On the other hand, India ranks as low as 107th when it comes to skills, and is at 101th in terms of product market efficiency. The country’s labour market needs transformation in order to protect its workers and also encourage female participation in the world place — which is abysmally low at a rank of 128 — according to the WEF.
This is also reflected the level of inequality in India. Income share of the top 10% in the country is higher than levels seen in the US, China and even Russia.
India’s progress was good — Others were better
The East Asia and Pacific region is the most competitive in the world. Countries like Singapore, Japan and Taiwan lead the charge on the rest of the world. In fact, Singapore holds the highest rank on the Global Competitive Index. But India lags woefully behind, according to the WEF.
Countries ranked near India all show small, but significant improvements in their score. Vietnam, for instance, is ranked 67 and moved up 10 places in the index showing 3.5 points of improvement.
Azerbaijan made an even greater jump of 11 places even though its competitive score only increased by 2.7 points to rank at 58.
Turkey was able to maintain its rank at 61 but only because its performance improved by 0.5 points. One of the reasons for its improved competitiveness is the diffusion of the Internet across the country. Turkey’s also has more women participating in the workforce and has strengthened workers’ rights.
Colombia, 57th on the Global Competitive Index, moved up three places brushing up its score by 1.1 points.
India vs BRICS
Among the BRICS nations, China is the best performer, maintaining its 28th position and outranking the Russian Federation at 43. That’s 40 places and 14 points ahead of India on the Global Competitive Index.
China’s performance is almost at par with OECD standards. In fact, its ICT adoption outperforms all 25 of the OECD countries.
South Africa, also moved up 7 places in the Global Competitive Index with a score improvement of 1.7 points ranking at 60. The only BRICS nation to rank lower than India is Brazil at 71.
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