India Falls by 25 Spots, Ranks 105th in Economic Freedom Index

India’s GDP has taken a significant hit due to the coronavirus outbreak.

(Photo: Altered by The Quint)

From occupying the 79th spot in 2019 to being down-ranked at the 105th position this year, India has fallen by 26 spots on the Global Economic Freedom Index 2020, according to an annual report released by Canada’s Fraser Institute in association with Centre for Civil Society, a New Delhi-based think tank, reports news agency PTI.

The report, titled The Economic Freedom of the World 2020, says that economic freedom in India can be enhanced by next-generation reforms in factors markets and in greater flexibility for international trade.

“India reported marginal decrease in size of government (from 8.22 to 7.16), legal system and property rights (from 5.17 to 5.06), freedom to trade internationally (6.08 to 5.71) and regulation of credit, labour and business (6.63 to 6.53),” the report said.

In the above-mentioned system, a score closer to 10 indicates greater economic freedom.

Need More Fiscal Stimulus for India’s Poor, Says IMF

Meanwhile, the International Monetary Fund (IMF) on Thursday, 10 September, said that there is a need for “further fiscal stimulus” in India, especially towards expenditures on health, food and income support for the vulnerable, in view of the coronavirus pandemic.

Addressing mediapersons at a virtual news conference in Washington, Gerry Rice, Director of the IMF’s Communications Department, said that the global financial institution supports India’s response to the pandemic, especially its fiscal stimulus for low-income households.

“We believe further fiscal stimulus is warranted, especially expenditures on health, food and income support for vulnerable households, and support for businesses.”

Gerry Rice, Director, IMF

Rice further added that in the short term, there is a need for a detailed, transparent and well-communicated plan on mid-term fiscal consolidation that “would help boost market confidence, thereby helping to reduce the cost of borrowing, as well as help the economy overall.”

Mixed Employment Bag

Amid all of this, the employment growth rate shrunk to 3.5 percent in FY-20 from 3.8 percent last year. However, the total number of jobs increased by 1.70 lakhs from 48.32 lakhs in to 50.02, reveals a CARE Ratings report.

In FY-20, around 321 companies slashed their headcounts by almost 1.13 lakh, when compared to 272 companies doing the same by 1.18 lakh the previous year.