India is “mostly unfree” in the 2005 Economic Freedom Index, published by the The Wall Stree Journal and The Heritage Foundation. Categorised into four – Free, mostly free, mostly unfree and repressed, India ranks a rather sad 118 of the 161 featured countries.
Here their take on India’s economic freedom:
“The results of the May 2004 elections raised concerns that key economic reform measures could be compromised or halted because of the populist demands of coalition partners and leftist parties, and that peace dialogues with Pakistan might languish. The administration of Prime Minister Manmohan Singh has closed down the Disinvestment Ministry, set up by the Bharatiya Janata Party, and has stalled the BJPâ€™s proposal to change labor laws to allow companies to lay off workers without state-government permission. The Congress Party and the leftist parties, however, agree that lack of investment resulting from inefficient bureaucracy and regulations hampers progress in the agricultural sector, which accounts for almost 60 percent of Indiaâ€™s economy, as well as in the manufacturing and services sectors; and instead of scrapping the entire privatization process as called for by its leftist allies, the Congress Party remains determined to pursue selective privatization of loss-making state businesses. Prime Minister Singh has stated that India would persist in the BJP-initiated rapprochement with Pakistan, which could funnel long-diverted resources into economic revitalization and reform efforts. Indiaâ€™s fiscal burden of government score is 0.5 point worse this year, but its government intervention score is 0.5 point better. As a result, Indiaâ€™s overall score is unchanged this year.”
Singapore is the world’s second most free economy, losing out only to Hong Kong. Surprisingly, the ascendancy of Lee Hsien Loong to PM has improved Singapore’s economic freedom scores.
US is now ranked 12 – this is the first year that the renowned land of freedom and opportunities has been pushed out of the top 10 list.
Netherlands and Germany are ranked 17 and 18 respectively, but while Netherlands is ranked a free econonmy, Germany is ranked only as mostly free.