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Impact of "improvement" in economic complexity under UPA: By 2024 India to be fastest growing economy
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| Top 20 countries which will grow fastest till 2024 |
Basing on analysis of decade-long economic growth data and policies between 2004 and 2014 – which Manmohan Singh was India’s Prime Minister – the Centre for International Development (CID) at Harvard University has predicted that India has the “potential to be the fastest growing economy over the coming decade.”
Measuring what they call economic complexity index (ECI), which captures the diversity and sophistication of productive capabilities embedded in a country’s exports to generate growth projections”, CID researchers say that between 2004 and 2014, India’s ranking sharply went up from No 47 to No 42 among 101 countries of the world.
As against India’s five points improvement in ECI, the countries that have made the greatest improvements in their complexity because of fast growth in per capita income over the past decade are China (ECI rank: up 16 positions to rank 17th globally), and South Korea (up 11 positions to rank 4th).
Other countries, which have shown better improvement over the last decade in ECI ranking, include Thailand (up 13 points), the Philippines (up 29 points), Vietnam (up 36 points), Egypt (up 14 points), Pakistan (up 11 points), and Bangladesh (up 18 points).
The CID at Harvard University is a university-wide center that works to advance the understanding of development challenges and offer viable solutions to problems of global poverty. It is a leading research hub focusing on resolving the dilemmas of public policy associated with generating stable, shared, and sustainable prosperity in developing countries.
“The projections reflect the latest 2014 trade data available. The global landscape for economic growth that results shows greatest potential for rapid growth in South Asia and East Africa. Conversely, oil economies and other commodity-driven economies face the slowest growth outlook”, CID says.
“India tops the global list for predicted annual growth rate for the coming decade, at 7.0 percent”, the researchers say, adding, “This far outpaces projections for its northern neighbor and economic rival, China, which the researchers expect to face a continued slowdown to 4.3 percent growth annually to 2024.”
This would happen because, says Ricardo Hausmann, Professor of the Practice of Economic Development at Harvard Kennedy School (HKS), the leading researcher of The Atlas of Economic Complexity, and the director of CID, during the decade in question India made “important gains in productive capabilities, allowing it to diversify its exports into more complex products, including pharmaceuticals, vehicles, even electronics.”
“We expect that India’s recent gains in complexity, coupled with its ability to continue improving it will drive higher incomes, positioning India to lead global economic growth over the coming decade,” Hausmann says.
Interestingly, other countries which are projected to grow fast include African countries, Uganda, Tanzania, and Kenya, rank in the top ten, with all predicted to grow at least 5.5 percent annually. “The growth forecast also looks favorably on Southeast Asia, where the Philippines, Malaysia, Indonesia, and Vietnam look to drive growth well above global averages”, the research says.
As for the growth in advanced economies, it is predicted to remain slow with the US expected to grow at 2.8 percent annually to 2024, with higher growth predicted in the United Kingdom and Spain, and slower growth in Italy and Germany.
The countries that rank in the top positions in ECI are Japan, Germany, and Switzerland holding the greatest economic complexity, the research says, adding, however, during the decade of 2004-14, “Great Britain (10th), the United States, (13th) and France (16th) have all slid.”
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