January 18th, 2012 
Ziaulla Namani
India’s economic freedom score is 54.6, making its economy the 123rd freest in the 2012 Index of Economic Freedom, after Pakistan which ranked 122.
Countries are ranked based on measures including rule of law, how open their markets are, regulatory efficiency and size of government.
“India’s score is unchanged from last year, with an improvement in labor freedom offset by declining scores in five other areas including business freedom, freedom from corruption, government spending, and monetary freedom,” the Heritage Foundation said.
India is ranked 25th out of 41 countries in the Asia–Pacific region, and its overall score is below the world average.
The reasons, it said, are that the foundations for long-term economic development remain fragile in the absence of an efficiently functioning legal framework, despite a high economic growth. Corruption was another reason.
The report also noted the significant policy paralysis in the country. Progress with market-oriented reforms, it noted, has been uneven and often reversed at the urging of those with an interest in maintaining the status quo.
”India’s restrictive and burdensome regulatory environment discourages private-sector growth and severely hampers realization of the economy’s full potential. Increasing inflationary pressure poses a major risk to overall macroeconomic stability,” it added.
Hong Kong was again named the world’s freest economy. The United States slipped a notch to 10th place.
Source – NDTV Profit.
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