The American thinktank, Heritage Foundation in its latest report titled ‘2017: Index of Economic Freedom’ has reported that India slipped by 3.6 points to 143rd rank from 123rd rank last year. The overall score of India was 52.6 points in the index, behind its several South Asian neighbours. The report classified India in the ‘mostly unfree’ economies category, citing uneven progresses on market-oriented reforms.
The thinktank has said that despite India sustaining an average annual growth of about 7 per cent over the past five years, growth is not deeply rooted in policies that preserve economic freedom. The report stated that the state maintains an extensive presence in many areas through public-sector enterprises. A restrictive and burdensome regulatory environment discourages the entrepreneurship that could provide broader private-sector growth. It also said that India has technology and manufacturing sectors as advanced as any in the world as well as traditional sectors characteristic of a lesser developed economy. Extreme wealth and poverty coexist as the nation both modernises rapidly and struggles to find paths to inclusive development for its large and diverse population.
The report noted that India is a significant force in world trade, but corruption, underdeveloped infrastructure, and poor management of public finance undermine overall development. The thinktank, however, credited Prime Minister Narendra Modi with reinvigorating India’s foreign policy. It said Modi, who in June 2016 made his fourth visit to the US in two years, has bolstered bilateral ties, particularly in defence cooperation.
As per the report, Hong Kong, Singapore and New Zealand topped the index. India’s neighbours Nepal (125), Sri Lanka (112), Pakistan (141), Bhutan (107), and Bangladesh (128) were ranked higher than India, while only Afghanistan (163) and Maldives (157) were ranked below India. Also, China with a score of 57.4 points, an increase of 5.4 points compared to previous year was placed at 111 position and the United States was ranked 17 with 75.1 points.