The twentieth World Competitiveness Yearbook 2008, released by Lausanne, Switzerland-based business school IMD, ranks India 29th, down two notches from last.
India, China down 2 notches to 29th and 17th, respectively
MUMBAI: When it comes to global competitiveness, India’s just a speck in the picture.
In fact, this year, it may very well have fallen out.
The twentieth World Competitiveness Yearbook 2008, released by Lausanne, Switzerland-based business school IMD, ranks India 29th, down two notches from last.
If it’s any consolation, China is down two levels, too — to 17.
The US is firmly perched atop the list, as it has been for the last fifteen years.
But surprise, surprise, puny Singapore might jolly well topple it next year.
“We may be seeing the US in the number one position for the last time. Singapore is closing the gap (score of 99.33, versus US’ 100) and 2008 might be the turning point where the US falls from its leadership of top competitors,” said professor Stephane Garelli of IMD, who also happens to be author of the report.
“In the 20 years that we have ranked and analysed competitiveness, we have learned one thing: no nation, however competitive, is immune to a breakdown, especially when it stems from the financial sector. In the words of Benjamin Franklin: even a small hole can sink a big ship,” Garelli said. He expects a recession in the US, which could help the change of guard.
“A recession in the US is a strong possibility. Will it last and will it spread? In both cases the answer is yes. The financial sector represents 40% of US corporate profits. In addition, the IMF reckons that a 1% fall in US growth cuts European growth by 0.5%. And high raw material and food prices trigger imported inflation at a time of low interest rates pretty nasty. 2008 will be rough,” Garelli predicts.
The yearbook presents the competitiveness rankings for 55 countries it covers.
The rankings are based on 331 criteria, which includes oft-used measures such as the gross domestic product and unemployment, and also includes yardsticks such the cost of mobile phone calls and the number of users a country has.
In all 55 countries have been covered.
The financial sector crisis, Garelli says, will prove to be the undoing of US.
In the years to come the Asian countries are likely to dominate these rankings as a greater number of people are considered middle class and that in turn will boost consumption. “Roughly 50 million people in India are considered middle class, and this figure will probably swell to 580 million by 2030,” Garelli told BusinessWeek.
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