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World Investment Report 2020

Why in NEWS?

• According to recently released World Investment Report, India became the world’s 9th largest recipient of the foreign direct investment in 2019, a jump from 12th place in the year 2018. This year’s Report naturally takes stock of the COVID-19 crisis. It also includes a new chapter, added at the request of the UN General Assembly, on investment in the Sustainable Development Goals.

Findings of the World Investment Report 2020

India became the world’s 9th largest recipient of the foreign direct investment in 2019 with $51 billion, increase from $42 billion investment in 2018, a 16% increase from the previous year, driving the FDI growth in South Asia, mostly in the information and communication technology and the construction industry.

• A lower but positive economic growth will be witnessed in India post-COVID19 pandemic period and the country's large market will continue to attract investments.
• Global FDI flows are speculated to see a plunge by up to 40% from $1.54 trillion in 2019. This would be for the first time since 2005 that global FDI falls below the $1 trillion mark.

World Investment Report

• The World Investment Report has been published annually since 1991 by UNCTAD (UNITED NATIONS CONFERENCE on TRADE and DEVELOPMENT). The World Investment Report focuses on trends in FDI worldwide, at the regional and country levels and emerging measures to improve its contribution to development.
• Each year´s Report covers the latest trends in foreign direct investment around the World and analyses in depth one selected topic related to foreign direct investment and development.

UNCTAD

• Established in 1964 as a permanent intergovernmental body, UNCTAD is the principal organ of the United Nations General Assembly dealing with trade, investment and development issues. It is also the United Nations focal point for the least developed countries, headquartered at Geneva, Switzerland.

WORLD COMPETITIVENESS INDEX

IN NEWS

• India remained on 43rd rank in an annual World Competitiveness Index compiled by Institute for Management Development (IMD). While Singapore has retained its top position on the 63-nation list.

WHY THIS RANK IS PROVIDED?

• In the highly interconnected and rapidly changing world, economies are affected by issues ranging from reservations over globalization to skepticism over automation, from the challenge of sustainability to that of implementation
• Competitiveness provides the framework to quantify the outcome of dealing with these challenges from a country perspective.
• Ultimately, it allows recognizing the factors that facilitate prosperity and this is how country expects rankings to be used and interpreted: competitiveness is both a tool and an objective of economic policy.
• IMD World Competitiveness Center has pioneered research on how nations and enterprises compete to lay the foundations for future prosperity.

STRENGTH OF INDIA

• While India’s overall position has remained unchanged in the 2020 list, it has recorded improvements in areas like long-term employment growth, current account balance, high-tech exports, foreign currency reserves, public expenditure on education, political stability and overall productivity. However, it has moved down in areas like exchange rate stability, real GDP growth, competition legislation and taxes.

WEAKNESSES OF INDIA

• Poor infrastructure, an important deficit in education investment, and a health system that does not reach everybody. For India to follow the path of China, it must stress its intangible infrastructure.

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