Geneva: India remains at 44th rank in the annual global competitiveness report by a Switzerland-based business school which cited problems like high corporate taxes and existence of a parallel economy for the low ranking.
The US continues to top the ranking due to its strong business efficiency and financial sector, its innovation drive and the effectiveness of its infrastructure.
India's 15 biggest improvements in the overall performance of the economy were real GDP growth per capita, government decisions, transparency, risk of political instability, labor productivity and adaptability of government policy among others, International Institute for Management Development (IMD) said yesterday in its annual world competitiveness ranking of 61 economies for the year 2015.
Whereas in the 15 biggest declines, direct investment flows abroad, government budget surplus/deficit, pension funding, food cost, parallel economy, unemployment legislation, Pupil-teacher ratio (primary education), pollution problems, foreign investors and real corporate taxes were among others.
Parallel (black-market, unrecorded) economy impairs economic development and high corporate taxes discourage entrepreneurial activity, the report said.
The report mentioned some challenges for India in 2015 such as achieving high growth with zero defect, zero effect model, mobilization of resources for public investment, implementation of the Goods and Services Tax, skill development and employment generation and infrastructure development.
India's economic performance improved from 21 to 16 rank, and business efficiency slightly increased from 34 to 33. Government efficiency remained at the same spot on 47 but infrastructure declined from 57 to 58.
India was ranked 13th in the Asia Pacific category.
The top 10 ranks include Hong Kong (2) and Singapore (3) move up overtaking Switzerland, which drops to fourth place. Canada (5), Norway (7), Denmark (8), Sweden (9) and Germany (10). Luxembourg moves to (6) from 11th place last year.