ASSIGNMENT – 1 (B)

“COMPETITIVENESS AMONG GLOBAL ECONOMIES”

Submitted By:
Ashwini Patil
Section-B
Pick the same nations as the HA 1A exercise. Go to their individual country
pages and then compare India with the others across the pillars cited in the
report. Comment on how far India needs to catch up on various
characteristics and what clear lessons India needs to take to reach to the top.

The four countries taken in the previous exercise were India, United Kingdom, China and Spain.
In the global competitiveness list the rank of the countries are:

COUNTIRES RANK OUT OF 140 RATINGS

INDIA 55 4.3
U.K. 10 5.4
CHINA 28 4.9
SPAIN 33 4.6
India, with a score of 4.31 ranks 55 among the various nations of the world, which have been
surveyed (140).

The various parameters of competitiveness have been listed below as follows:

1. Institutions
2. Infrastructure
3. Macro-economic Environment
4. Health and primary Education
5. Higher education and training
6. Goods market efficiency
7. Labor market efficiency
8. Financial market development
9. Technological Readiness
10. Market size
11. Business Sophistication
12. Innovation

The countries are ranked based on the 12 parameters or pillars of competitiveness. We now
compare India’s score on each of these Pillars vis-a-vis the emerging competitor economy
(China) and other countries like UK and Spain. We find the results as shown below (Ranks are out
of 140):
 PARAMETERS INDIA UNITED CHINA SPAIN
KINGDOM
Institutions 60 14 51 65
Infrastructure 81 9 39 10
Macro-economic 91 108 8 116
Health and 84 18 44 32
primary
education
Higher education 90 18 68 29
and training
Goods market 91 12 58 62
efficiency
Labor market 103 5 37 92
efficiency
Financial market 53 16 54 77
Technological 120 3 74 25
Readiness
Market Size 3 9 1 15
Business 52 6 38 31
sophistication
Innovation 42 12 31 37

In these mentioned parameters the above countries are ranked as following:

 RANKING OF DIFFERENT COUNTRIES ON
VARIOUS PARAMETERS
140
120
100
80
60
40
20
0

INDIA UK CHINA SPAIN

The ratings of the countries on the parameters are:

RATINGS OF THE COUNTRY

8
7
6
5
4
3
2
1
0

INDIA UK CHINA SPAIN

 ROAD MAP for India
PARAMETERS SOLUTIONS
Institutions Public and Private institutions need improvement. India has been showing
improvement trend, but needs attention too

Infrastructure Electricity supply is a bottleneck for India. Road and Railway transport
networks are moderately good. Rural and Urban Electrification
programme under the Government schemes of PM Modi needs further
attention
Macro- After 5 years of decline, India under PM Modi has benefitted due to
economic reduction of corruption, fiscal deficit and inflation, but still has a long
way to go.
Health and Primary Education and quality of health had been worrisome. From 2007
onwards, new AIIMS type World Class health institutions are being set up in
primary every state to provide affordable and quality healthcare to people.
education
Higher Job training and quality of education is improving due to opening of
education and many Central Universities, IITs, NITs and IIMs. But still, it has to be
made more accessible and affordable to people by strengthening primary
training education services.
Goods market Disinvestment, FDIs and Privatization may be considered as options to
efficiency increase competition among industries to improve goods market
efficiency.
Labor market Concurrent Labour Laws need to be modified to allow competitiveness
efficiency among labour. Talent utilization should also be focussed upon
efficiently by giving job opportunities aligned to the specialization of
the labour.
Financial Efficiency is moderately good. Trustworthiness needs to be
market increased by eliminating corruption, which is currently undertaken
by PM Modi and his Government.
Technological This is a serious roadblock for India’s competitiveness. India needs to
Readiness offer digital connectivity to all of its people. Other countries perform very
well in offering digital and internet connectivity to increase ease of doing
business. Recently the Government Schemes of Digital India and Aadhar
based Financial transactions and measures like Demonetization and
Cashless Economy are helping the people move towards digital economy.
Market Size An advantage for India
Business Moderately good
sophistication
Innovation Recent advancements in Government sponsored research and development
spending and hiring more research and doctoral graduates is a good sign.
However, India needs to increase GDP spends on R&D to above 3.5% from
0.85%. Japan spends about 3.5%, China spends 2.1% and Switzerland spends
2.9% of their GDP on R&D. Recently PM Modi Government set a target of
spending 2% on GDP on R&D.