New Delhi:Enthused by improvement in India’s rank in WEF’s Competitiveness Index, the government today exuded confidence that the country will witness a similar gain in the World Bank’s ease of doing business ranking and it may also prompt a sovereign ratings upgrade.

Although global credit rating agencies follow their own procedure, they will certainly take into account the 16-point jump in India’s ranking in the World Economic Forum’s Index, Finance Minister Arun Jaitley told reporters here.

Global agency Moodys last week maintained status quo on India’s rating despite the government’s pitching for an upgrade listing a string of reforms it has undertaken.

With a host of reform measures, including the Goods and Services Tax (GST) and enactment of insolvency law, the country will also witness improvement in its ranking in the World Bank’s Ease of Doing Business in coming years.

India was ranked 130th among 189 countries in the ease of doing business rankings 2016, an improvement of four spots from the previous year.

Asked if the reform measures would get reflected in the World Banks’ forthcoming ranking for 2017, Jaitley said: “There was a cut off date for that. After that cut off date, many steps were taken. If you see GST, Bankruptcy and Insolvency Act happened after that. So it’s a continuous process. What has not been reflected would come up in the counting next year.”

The jump of 16 places for India in WEF’s competitiveness index to 39th rank from last year’s 55th place is the highest for any economy this year. India is also the second-most competitive among BRICS nations behind neighbouring China, which is ranked at the 28th position.

Jaitley said the WEF report indicates that if there is a possible implementation of the GST in 2017 then that part of negative categorisation with regard to goods market itself would get adequately taken into consideration.

With regard to India’s information and communications technology (ICT), the WEF report said that ongoing effective implementation of Digital India the report indicates that the ranking is likely to move up on that count, he said.

“I think keeping the popular aspirations, the reform agenda of the government, a possible continuous improvement in the goods market through the GST, in the digital India space, I am sure that this momentum would continue.

“There are, of course, areas like health care and education where we need to do a lot more in order to further move up as far as this agenda is concerned,” Jaitley said.

Jaitley said that in an extremely positive development, data released today by the WEF shows that India s ranking in the Global Competitiveness Index (GCI) has improved by 16 places for the second year in a row.

According to the latest ranking, he said that India is placed 39th among 138 countries, ahead of BRICS countries other than China which is ranked 28th.

India s rank has steadily improved from 71 in 2014-15 to 55 in 2015-16 and to 39 in the latest report.

“The landmark improvement in the Global Competitiveness rankings India is in consequence of the structural reforms and policy initiatives taken by the government in the last two years and should be viewed as an encouragement to us to continue with the agenda of reforms which would further streamline economic decision making and help us move up on the index of global competitiveness,” Jaitley said.

The 12 pillars underlying GCI include institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and innovation.

India’s competitiveness has improved this year across the board, in particular in goods market efficiency, business sophistication and innovation.

The macroeconomic environment also improved due to better monetary and fiscal policies and lower oil prices.

The Report analyses how India s competitiveness score had stagnated between 2007 and 2014 till the new government took office and undertook a range of reforms including opening the economy to foreign investors and international trade, improving public institutions and building infrastructure.

There is however no room for complacency and the government will continue to focus on areas which need improvement, he said.

In the coming months and years, significant improvement in goods market efficiency may be expected from the GST implementation that will reduce fragmentation of the domestic market.

PTI