Gujarat ranks No 1 in `economic freedom`: Report

By Deepak Nagpal | Last Updated: Wednesday, March 19, 2014 - 09:50

Zee Media Bureau/Deepak Nagpal

New Delhi: In a boost to BJP`s prime ministerial candidate Narendra Modi ahead of the Lok Sabha elections, Gujarat has been ranked number one in a list of India`s 20 largest states in terms of “economic freedom”.

The index on “economic freedom” takes into account governance, growth, citizens’ rights, and labour and business regulations.

As per the 2013 `Economic Freedom of the States of India` report, “Gujarat has widened its lead at the top of the economic freedom table, with an index score of 0.65 (on a scale from 0 to 1.0). Tamil Nadu remains in second position, but some distance behind, with a score of 0.54.”
The report also had some good news for Nitish Kumar`s Bihar. The state, which though continues to remain at the bottom of table, has seen significant progress after Nitish Kumar took charge as the chief minister, the report said.

It is noteworthy that the three states, which have seen fastest improvement in economic freedom, have also recorded a significant jump in economic growth. The growth rate in Gujarat has been an average 12 percent between 2005 and 2011, while in Chhattisgarh and Andhra Pradesh it has been 10.6 percent and 10.4 percent respectively.

“Gujarat is not only the freest state, but it has also registered the fastest rate of improvement in the index (from 0.46 in 2005 to 0.65 in 2013),” the report said.
“States in India which are economically more free are also doing better in terms of a higher per capita growth for its citizens, unemployment levels are lower in these states, sanitary conditions are better and the states also attract more investments,” said the report.

As regards Bihar, the report said, “Under chief minister Nitish Kumar, its GDP growth rate averaged 11.8% between 2004-05 and 2010-11.”

“The main pillars of Nitish Kumar’s strategy were the improved provision of two essential government services (technically called public goods) needed for the proper functioning of the state—public order and good road connectivity,” it adds.

Bihar with an index score of 0.31 remains that bottom of the table, behind Assam (0.32) and Jharkhand (0.33), as per the report.

The report, which is published every year, was co-authored by economists Bibek Debroy and Laveesh Bhandari, and Swaminathan S Anklesaria Aiyar. It estimates economic freedom based on 2013 data.



First Published: Wednesday, March 19, 2014 - 09:44

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