“Index of Economic Freedom” 2021 released

What is the News?

The Heritage Foundation releases The Index of Economic Freedom 2021.

Key Findings of  Index of Economic Freedom 2021

• India ranked 121st in the index with a score of 56.5 points under the category of ‘mostly unfree’.
• In Asia-Pacific, India ranked 26th among the 40 countries.

Other Key Findings

• Singapore tops the index followed by New Zealand, Australia, Switzerland, and Ireland.
• Hong Kong was left out of the 2021 index calculation for the first time. It is because of China’s increasing control over the city’s economic policies. Hong Kong topped the index for 25 out of 26 years except for 2020.

About Index of Economic Freedom

• It is an annual index.  This index created in 1995 by think-tank The Heritage Foundation and The Wall Street Journal.
• Purpose: It measures the degree of economic freedom in countries across the world.
• Coverage: The Index covered economic freedoms in 184 countries.

Parameters: The index measures 12 indicators grouped into four broad categories of economic freedom:

• Rule of Law (property rights, government integrity, judicial effectiveness)
• Government Size (government spending, tax burden, fiscal health)
• Regulatory Efficiency (business freedom, labour freedom, monetary freedom)
• Open Markets (trade freedom, investment freedom, financial freedom).

Each of these twelve economic freedoms within these categories is graded on a scale of 0 to 100. Score 0 is the least economic freedom and score 100 is the highest economic freedom.

Source: Business Standard