Tuesday, October 27, 2020

India’s rank in World Bank’s ‘Ease of Doing Business’ ranking could be higher, data of 4 countries, including China, manipulated

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India's ranking in World Bank's 'Ease of Doing Business' ranking could be higher, data of 4 countries, including China, manipulated

— Consider reading the article India’s rank in World Bank’s ‘Ease of Doing Business’ ranking could be higher, data of 4 countries, including China, manipulated on OpIndia website —

In a shocking report that has emerged, the Wall Street Journal has reported that the World Bank has put a halt to its “Ease of Doing Business” Ranking report since it could be susceptible to manipulation. According to the report, the data of four countries – China, Azerbaijan, the United Arab Emirates and Saudi Arabia – could have been inappropriately altered. It is pertinent to note that all 4 counties that are now under scanner ranked higher than India in the report released in 2019 Ease of Doing Business Rankings by the World Bank.

What the WSJ report says about the World Bank Rankings

Wall Street Journal (WSJ) reported that the World Bank was putting a halt to the publication of the Ease of Doing Business report due to irregularities in the data and it would be reviewing the reports of the last 5 years. According to the report, data of 4 countries – China, Azerbaijan, the United Arab Emirates and Saudi Arabia – were manipulated and altered to show a higher ranking than they deserved.

The WSJ report quoted World Bank officials saying, “It is beginning a systematic review of the data, launching an independent audit of the process, and that it would correct the data”.

The World Bank has reportedly said that the reports that were released in October 2017 and October 2019 could have been affected with these data manipulations and that owing to the audit, the report that was set to release in October 2020 would be delayed.

The WSJ reports:

For three of the countries affected, China, Azerbaijan and the U.A.E., the World Bank had reported a marked improvement in their business environments in recent years. Five years ago, China ranked 90th in the report. Last year, its ranking climbed to 31st. Azerbaijan rose from 80th to 34th over that time. In last year’s report, the U.A.E. was ranked the 16th-best business environment in the world, up from 22nd five years ago. Saudi Arabia’s ranking slipped from 49th to 62nd in the past five years“.

Justin Sandefur, a senior fellow at the Center for Global Development said that the rankings are strife with conflict of interest which is bound to happen when the counties being ranked are the ones that get a loan from the World Bank. Hence, he said, there might be pressure from within to either show a countries performance as better or worse. He was also of the opinion that the report on Ease of Doing Business should be scrapped.

India ranking in the World Bank Ease of Doing Business report could be higher

In the WSJ report, 4 countries have been mentioned, whose data may have been manipulated to give them a better ranking – China, Azerbaijan, the United Arab Emirates and Saudi Arabia. Interestingly, all 4 nations whose data is said to have been manipulated were ranked above India in the report that was released in October 2019 (Ease of Doing Business Rankings 2020).

While India ranked 63 in the Ease of Doing Business Ranking, China ranked 31, Azerbaijan ranked 24, UAE ranked 16 and Saudi Arabia ranked 62.

Ease of Doing Business Ranking

In fact, the rise in the rankings of China have been rather remarkable.

How China’s ranking changed over the years

If one sees carefully, until 2018, China’s ranking was rather low in the Ease of Doing Business report. However, it managed to reach a 31 ranking almost all of a sudden in the Ease of Doing Business Rankings 2020 (released in October 2019).

India, which was ranked 77th among 190 countries in the previous ranking, had shown an improvement of 14 places compared to its position in 2018. 2018 rankings were also an improvement of 23 places. Even though the jump in the World Bank’s Ease of Doing Business ranking is remarkable, India had missed its target of getting within the top 50 in the report released in 2019. The country’s score had improved from 67.3 to 71.0, as per the survey released by the World Bank in October 2019.

Graph showing ranking of India over the years (Image courtesy: All India Radio)

Given the manipulations in the rankings, it is plausible that India’s ranking, which currently ranks below all the 4 nations, could jump up once the audit of the last 5 years in conducted.

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