World Economic Forum says Indian institutions' quality in terms of public spending has improved

Moneycontrol News 

The World Economic Forum has praised the quality of Indian institutions in terms of public spending in its Global Competitiveness Report for 2017-18. The report has maintained that India still needs to tackle corruption in certain sectors.

“The quality of institutions has increased further, especially in terms of efficiency of public spending, but the private sector still considers corruption to be the most problematic factor for doing business in India,” the report says.

A slew of reforms, digitisation and e-governance measures introduced in the country have helped the polity and the economy as a whole.

India has been ranked at 40 in the Global Competitiveness Index 2017-18 compiled by the World Economic Forum (WEF), the highest rank for a South Asian country so far out of a total of 137 countries across the globe.

The respective scores of the key indicators for India's economy (Courtesy: WEF)

This time the scores for India have actually improved compared to last year’s, as per a statement from WEF.

Despite India's ranking being technically one spot lower than last year’s 39th rank, the two are not comparable as parameters of measurement have changed.

"India (40th) stabilizes this year after its big leap forward of the previous two years. The score improves across most pillars of competitiveness, particularly infrastructure (66th, up two), higher education and training (75th, up six), and technological readiness (107th, up three), reflecting recent public investments in these areas," says World Economic Forum.

Parameters of the 2017 Index

The competitiveness index has been compiled this time using a weighted average of the "Twelve Pillar of Competitiveness"- these include factors like- Institutes, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods and labour market, finance, technology, market size, business sophistication and innovation.

As per the report, corruption, lack of access to financing and tax regulations remain the prime problems for setting up business in India.

The major factors that are affecting business set-up in India (Courtesy: WEF)

The new GST era ushered in July this year is expected to tackle the tax regulations issue. But a lot will depend on effective implementation.

Switzerland, the United States and Singapore continue to be the world’s top three competitive economies, while China was ranked at 27 and Russia at 38 are ahead of India among the BRICS countries.