India has experienced the most significant increase among Asian economies, climbing six positions from 43rd to 37th on the annual World Competitiveness Index compiled by the Institute for Management Development, primarily due to improvements in economic performance.
Denmark has risen to the top of the 63-nation list from third place last year, while Switzerland has slipped to second place and Singapore has reclaimed the third position in a global study released on Wednesday.
The top 10 countries include Sweden in fourth place, followed by Hong Kong SAR (5th), the Netherlands (6th), Finland (7th), Norway (8th), and the USA (10th).
Among the top-performing Asian economies are Singapore (3rd), Hong Kong (5th), Taiwan (7th), China (17th), and Australia (19th).
After five years of stagnation, 2022 saw a significant improvement in India’s competitiveness, with the economy moving up from 37th to 28th, according to IMD. The domestic economy experienced a remarkable rise from 30th to 9th position in just one year.
India has made considerable progress in various areas, with the labor market moving from 15th to 6th place and significant improvements in management practices and business attitudes.
Prime Minister Modi’s reforms, including changes to retrospective taxes and regulation in sectors like drones, space, and geo-spatial mapping, have helped restore trust in the business community and contributed to India’s strong performance in the 2022 WCR, according to economists at the IMD World Competitiveness Centre.
India’s commitment to combatting climate change, including Modi’s pledge of net-zero by 2070, aligns with its strength in environment-related technologies as reflected in the ranking.
Challenges facing India include managing trade disruptions, ensuring energy security, sustaining high GDP growth post-pandemic, skill development, employment generation, asset monetization, and resource mobilization for infrastructure development.
The top five appealing factors of India’s economy for businesses are a skilled workforce, cost competitiveness, economic dynamism, high educational levels, and open and positive attitudes.
The IMD World Competitiveness Ranking (WCR) highlights that inflationary pressures, along with COVID-19 and geopolitical conflicts, are impacting the competitiveness of national economies.
Inflationary pressures, geopolitical conflicts, supply chain bottlenecks, and COVID-19 are the most significant trends affecting businesses in 2022, according to the WCC Chief Economist.
China, which slipped one spot this year, needs to restructure its economy towards high-value services and consumption to achieve long-term economic prosperity, according to IMD economists.
The 2022 World Competitiveness Ranking, released by IMD business school in Switzerland and Singapore, assesses 63 economies based on their promotion of prosperity and economic well-being through data and executive surveys.
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