Is India more prosperous than China? Yes, says the Legatum Prosperity Index. India ranks 45th in the index well ahead of China.
The third edition of the Legatum Prosperity Index ranks 104 countries (covering 90 per cent of the world's population), based on a definition of prosperity that combines economic growth together with measures of happiness and quality of life.
Although outperformed by China on several economic indicators, India's superior overall ranking is achieved through its performance in the critical non-economic factors such as personal freedom which encompasses freedom of speech and religion, national tolerance for immigrants and ethnic and racial minorities.
India also ranks highly on measures of social capital, reflected in the percentage of citizens who volunteer, give to charity, help strangers, and who feel they can rely on family and friends. In this area, India ranks fifth in the world, ahead of the United States, the United Kingdom and Finland.
"India is a classic example of a country whose prosperity stems largely from its social capital and quality of life rather than its performance on the purely economic measures. Although China outperforms India on several economic indicators, India is 30 places higher in the final rankings because of China's poor levels of personal freedom and democracy," said William Inboden, senior vice president of the Legatum Institute.
"However, there are some areas of concern for India, particularly in the quality of healthcare and education for which India ranks 88th and 86th respectively," concluded Inboden.
India's low global ranking on health indicators results from a number of factors: severe underinvestment in medical facilities resulting in poor standards of healthcare; low levels of improved sanitation facilities; undernourishment affecting 20 per cent of Indian citizens; a low average health adjusted life expectancy of 53 years; and a high number of citizens are reporting that they suffer from health problems. It is ranked 55th in entrepreneurship and innovation.
Ranking
Average Life Satisfaction Ranking -- 68th/104
Per Capita GDP Ranking -- 83rd/104
WEF Global Competitiveness Index -- 49th/133
UN Human Development Index -- 132nd/179
Heritage/WSJ Economic Freedom Index -- 123rd/178
TI Corruption Perceptions Index -- 85th/180
Vision of Humanity Global Peace Index -- 122nd/144
Image: India ranks at 45 in the Prosperity Index.
China
China is ranked at the 75th position with unemployment is at 4 per cent and inflation rate at only 5 per cent. Despite the large availability of jobs, the workforce is hindered by a relatively small amount of physical capital which limits their production capacity.
While net interest margins are low at 2.6 percentage points, the percentage of defaulted loans is relatively high at 6.7 per cent, indicating weak vetting of borrowers.
Household expenditure as a share of GDP is the fifth highest by international standards, providing a large domestic market for Chinese firms while not compromising the domestic savings rate which is the third highest globally, at over 53 per cent of GDP. It is ranked 38th in entrepreneurship and innovation.
Ranking
Average Life Satisfaction Ranking -- 82nd/104
Per Capita GDP Ranking -- 71st/104
WEF Global Competitiveness Index -- 29th/133
UN Human Development Index -- 94th/179
Heritage/WSJ Economic Freedom Index -- 132nd/178
TI Corruption Perceptions Index -- 72nd/180
Vision of Humanity Global Peace Index -- 74th/144
The third edition of the Legatum Prosperity Index ranks 104 countries (covering 90 per cent of the world's population), based on a definition of prosperity that combines economic growth together with measures of happiness and quality of life.
Although outperformed by China on several economic indicators, India's superior overall ranking is achieved through its performance in the critical non-economic factors such as personal freedom which encompasses freedom of speech and religion, national tolerance for immigrants and ethnic and racial minorities.
India also ranks highly on measures of social capital, reflected in the percentage of citizens who volunteer, give to charity, help strangers, and who feel they can rely on family and friends. In this area, India ranks fifth in the world, ahead of the United States, the United Kingdom and Finland.
"India is a classic example of a country whose prosperity stems largely from its social capital and quality of life rather than its performance on the purely economic measures. Although China outperforms India on several economic indicators, India is 30 places higher in the final rankings because of China's poor levels of personal freedom and democracy," said William Inboden, senior vice president of the Legatum Institute.
"However, there are some areas of concern for India, particularly in the quality of healthcare and education for which India ranks 88th and 86th respectively," concluded Inboden.
India's low global ranking on health indicators results from a number of factors: severe underinvestment in medical facilities resulting in poor standards of healthcare; low levels of improved sanitation facilities; undernourishment affecting 20 per cent of Indian citizens; a low average health adjusted life expectancy of 53 years; and a high number of citizens are reporting that they suffer from health problems. It is ranked 55th in entrepreneurship and innovation.
Ranking
Average Life Satisfaction Ranking -- 68th/104
Per Capita GDP Ranking -- 83rd/104
WEF Global Competitiveness Index -- 49th/133
UN Human Development Index -- 132nd/179
Heritage/WSJ Economic Freedom Index -- 123rd/178
TI Corruption Perceptions Index -- 85th/180
Vision of Humanity Global Peace Index -- 122nd/144
Image: India ranks at 45 in the Prosperity Index.
China
China is ranked at the 75th position with unemployment is at 4 per cent and inflation rate at only 5 per cent. Despite the large availability of jobs, the workforce is hindered by a relatively small amount of physical capital which limits their production capacity.
While net interest margins are low at 2.6 percentage points, the percentage of defaulted loans is relatively high at 6.7 per cent, indicating weak vetting of borrowers.
Household expenditure as a share of GDP is the fifth highest by international standards, providing a large domestic market for Chinese firms while not compromising the domestic savings rate which is the third highest globally, at over 53 per cent of GDP. It is ranked 38th in entrepreneurship and innovation.
Ranking
Average Life Satisfaction Ranking -- 82nd/104
Per Capita GDP Ranking -- 71st/104
WEF Global Competitiveness Index -- 29th/133
UN Human Development Index -- 94th/179
Heritage/WSJ Economic Freedom Index -- 132nd/178
TI Corruption Perceptions Index -- 72nd/180
Vision of Humanity Global Peace Index -- 74th/144
