India has been ranked very low, mostly in the bottom half, globally on most of the parameters for inclusive growth and development even as it fares much better internationally when it come to business and political ethics.
In a first of its kind global rankings, across different groups of countries in terms of their per capita income levels, the World Economic Forum (WEF) found that most countries are in fact missing major opportunities to reduce income inequality and same is the case with India.
WEF said that the new study, which was conducted over the past two years, seeks to identify the various ways policymakers can drive economic growth and equity at the same time â€“ and assesses them on their relative success in implementing these measures.
“Our message is unequivocally that leaders must pursue economic strategies that are at the same time pro-growth and pro-labour,” said the Geneva-based think tank known for its economic conclaves held in different parts of the world including in Davos, Switzerland and in India.
India has mostly been ranked in the bottom half of the 38 countries that make up our lower middle income bracket.
Particularly disappointing is its position in terms of Fiscal Transfers, where it ranks 7th out of 38. It also ranks very low at 32nd for Tax Code and 36th for social protection. WEF said that another area that policymakers in India would need to prioritise improvement would be ‘Asset building and entrepreneurship’, in particular the Small business ownership, where India ranks bottom among its peers at 38th place.
However, India does demonstrate leadership in some areas, WEF said, while naming areas like corruption and rents where it comes 8th.
For business and political ethics, India ranks 12th, while it ranks 11th on the Financial intermediation of real economy investment pillar, which suggests that money invested in the economy generally gets directed towards productive uses.
WEF said its first Inclusive Growth and Development Report presents a new framework for assessing countriesâ€™ efforts to foster economic growth that raises the living standards of entire societies.
“Around the world, no bigger policy challenge preoccupies political leaders than expanding social participation in the process and benefits of economic growth,” WEF said while releasing the report that covers 112 economies.
WEF said that all countries have room for improvement and there is considerable diversity in performance not only across but also within countries. No country scores above average for its peer group in all 15 sub-pillars and only a few come close.
It further said it is possible to be pro-inclusiveness and pro-growth at the same time.
Stating that all countries have room for improvement, WEF said no country is a top performer in every sub-pillar. “Indeed, not a single country scores above average in all 15 sub-pillars,” it added.
Among major economies, Switzerland has come on the top in terms of basic infrastructure and services, while Finland is on the top in terms of education and skills as also for asset building and entrepreneurship. Norway is ranked at the top for labour, employment and compensation.
On India, WEF said it ranks very low at 30th place for GDP per capita among the lower middle income countries, but ranks much better at 8th place in terms of global competitiveness score.
For employment and labour compensation, it ranks very low at 32nd place, 27th for basic services and infrastructure and 31st for quality of education system. However, India ranks much better at 7th place when it comes to ease of finding the right talent.