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Global Competitiveness Index

Topics Covered:

  1. Science and Technology- developments and their applications and effects in everyday life Achievements of Indians in science & technology; indigenization of technology and developing new technology.

 

Global Competitiveness Index

 

What to study?

For Prelims: Performance of India and other countries.

For Mains: Challenges and concerns for India, ways to address them.

 

Context: GCI 2019 has been released.

  • The Global Competitiveness Index (GCI), which was launched in 1979, maps the competitiveness landscape of 141 economies through 103 indicators organised into 12 pillars.
  • The pillars, which cover broad socio-economic elements are: institutions, infrastructure, ICT adoption, macroeconomic stability, health, skills, product market, labour market, the financial system, market size, business dynamism and innovation capability.

 

Performance of India:

  • Compared to last year, India has moved down 10 places to rank 68th. India was ranked 58th last year.
  • It is among the worst-performing BRICS nations along with Brazil (ranked even lower than India at 71st this year). 
  • India ranks high in terms of macroeconomic stability and market size, while its financial sector is relatively deep and stable despite the high delinquency rate, which contributes to weakening the soundness of its banking system. 
  • In innovation, India is well ahead of most emerging economies and on par with several advanced economies.

 

Concerns and way ahead for India:

  • Major shortcomings: limited ICT (information, communications and technology) adoption, poor health conditions and low healthy life expectancy. 
  • The healthy life expectancy, where India has been ranked 109th out of total the 141 countries surveyed for the index, is one of the shortest outside Africa and significantly below the South Asian average.
  • With a ratio of female workers to male workers of 0.26, India has been ranked very low at 128th place.

 

Way ahead for India:
Now, India needs to grow its skills base, while its product market efficiency is undermined by a lack of trade openness and the labour market is characterised by a lack of worker rights’ protections, insufficiently developed active labour market policies and critically low participation of women.

 

Performance of other countries:

  • Asia-Pacific is the most competitive region in the world, followed closely by Europe and North America.
  • The United States may have lost out to Singapore overall, but it remains an innovation powerhouse.
  • Nordic countries are among the world’s most technologically advanced, innovative and dynamic while also providing better living conditions and social protection.

 

Global concerns- key observations made by the report:

  1. The world is at a social, environmental and economic tipping point.
  2. Subdued growth, rising inequalities and accelerating climate change provide the context for a backlash against capitalism, globalization, technology, and elites.
  3. There is gridlock in the international governance system and escalating trade and geopolitical tensions are fuelling uncertainty.
  4. This holds back investment and increases the risk of supply shocks: disruptions to global supply chains, sudden price spikes or interruptions in the availability of key resources.
  5. Ten years on from the global financial crisis, the world economy remains locked in a cycle of low or flat productivity growth despite the injection of more than $10 trillion by central banks.

 

Sources: the Hindu.