Index of Economic Freedom 2018 Current Affairs
India ranked 130th out of 186 economies in recently released Index of Economic Freedom 2018 that measures the degree of economic freedom in the countries of the world. In this edition of index, India with score of 54.5 jumped 13 places from 143rd rank in previous year (2017) with a score of 52.6 points.
Index of Economic Freedom (IEF)
The index was released by top US based Think Tank, The Heritage Foundation. It ranks countries based on score ranging 0 (least free) to 100 (most free). The score is based on 12 factors of economic freedom, separated into four categories, using statistics from international organizations like World Bank, IMF, Economist Intelligence Unit and Transparency International. Based on the score, countries are grouped in 5 different categories, Free (80–100), Mostly Free (70.0–79.9), Moderately Free (60.0–69.9), Mostly Unfree (50.0–59.9) and Repressed (0–49.9).
Twelve factors for calculating score are: property rights, government integrity, tax burden, judicial effectiveness, government spending, fiscal health, business freedom, monetary freedom, labor freedom, trade freedom, investment freedom and financial freedom.
Key highlights of 2018 IEF
Top 10 countries are: Hong Kong, Singapore, New Zealand, Switzerland, Australia, Ireland, Estonia, United Kingdom, Canada and UAE.
The world economy overall is rated moderately free and world average has now risen three and a half points, from 57.6 to 61.1 since the first edition of the index was released in 1995.
India’s Neighbours: Bhutan (87), Sri Lanka (111), Bangladesh (128), Pakistan (131) and Nepal (133). China with 57.4 points was ranked 111th. It has jumped one spot compared from 112th rank in previous edition.
BRICS: South Africa (77), Russia (107), China (111), India (130) and Brazil (153).
India related Facts: India is developing into open-market economy, but traces of its past autarkic policies still remain. The economic liberalisation measures undertaken in India, including industrial deregulation, privatisation of state-owned enterprises and reduced controls on foreign trade and investment since in early 1990s has accelerated growth. However, corruption, underdeveloped infrastructure, restrictive and burdensome regulatory environment and poor financial and budget management continue to undermine overall development.