Switzerland tops in world competitiveness; India, US slide

GENEVA: While Switzerland continues to hold its numero uno position in world competitiveness, United States has slipped to 5th position, according to Global Competitiveness Report (GCR) 2011.

The GCR further finds that Asia has become more competitive globally, as a result of its rise to economic prominence. The report states that over the last five years several countries in the Asian Pacific regions, including China, Indonesia, Vietnam and Sri Lanka, have made big strides in the GCI (Global Competitiveness Index) rankings. Singapore emerges the 2nd most competitive country.

India’s performance has, however, been disappointing, sliding 5 places to 56. India’s gap with China has widened. China is ranked 26th, improving its score and rank since 2005. The WEF states that the score difference between India and China has increased sixfold between 2006 and now, from less than 0.1 to 0.6 points.

The GCR puts it down to India’s “mediocre accomplishments” in areas which are considered to be the basic factors underpinning competitiveness. India’s supply of transport, ICT, and energy infrastructure remain largely insufficient and ill-adapted to the needs of business (89th).

India Inc cites India’s infrastructure as the biggest hindrance to doing business in the country. WEF notes that though there has been an improvement since 2006, it does not translate into a higher ranking because other countries have improved faster.

The report paints a similar picture in India’s health and basic education (which is 101st) pillar. It finds that despite some improvements, the quality of public health and basic education are a prime cause of worry.

It also states that though there are some encouraging trends in education quality and public health, the same cannot be said of the country’s institutions and macroeconomic environment, which are the other two dimensions comprising the basic requirements component of the GCI (Global Competitiveness Index).

The business community has become discontented about India’s lack of reforms. The apparent inability of the government to provide a more conducive environment for business has been growing. This discontent is fuelled by corruption (India is listed as 99th) and its burdensome regulations. India has dropped from 37th to 69th rank in the Institution pillar.