Reports abound these days. Of the reports that should be taken seriously is that one on global competitiveness produced by Europe?s IMD business school. Its methodology is respected. And its message in the latest edition is that emerging economies should do a bit of soul searching. India?s rank has fallen by two, to 29th. China has gone down by two positions too, to 17th. Russia, at 47, has slipped four rungs. Brazil is the only exception in the Bric group, improving its rank by six positions and claiming the 43rd slot. India, Russia, China have all been posting good growth rates. But the competitiveness report shows that systemic conditions can worsen even in high performance economies. In India?s case, infrastructure and government are the two big drawbacks, according to the report. While the country is ranked among the top 20 nations in five of the 10 indicators used to compute business efficiency and overall economic performance, its rank falls below 30 in the case of three of the five indicators on government efficiency and below 40 in the case of four of the five infrastructure indicators. No one who has any experience of India should be surprised by this. Reforms haven?t touched the government and in building infrastructure, India suffers from a mix of policy confusion and political manipulation.
There are some interesting substories. On fiscal policy, India is ranked five, an impressive performance and proof that fiscal correction is working, except that the oil bonds are off-book items. India also scored moderately well on building scientific infrastructure, obtaining a 29 th position. This can and should improve, if only HRD ministry?s policies were in tune with economic realities. Indian universities are in fact falling off the global map while China determinedly pursues a programme of creating centres of excellence. Shamefully for India, the report ranks it below 50 when it comes to health infrastructure. Only 15 paise of every rupee spent on public health goes for buying medicines and basic minimum healthcare is a fantasy for a distressingly large number of Indians. Studies show that the poor are opting for private care whenever they can and maybe a different model?incentivising small private health centres and directly subsidising the poor?s health care purchase?should be thought of.
