India eyes gain from China’s pain in audit of WB rankings
NEW DELHI: India hopes the massive fraud highlighted in the audit report of Doing Business ranking by the World Bank, which pointed out undue pressure from China to improve its ranking, will help shift manufacturing supply chains to India.
World Bank is discontinuing publication of its much sought after Doing Business ranking immediately after an external audit unearthed undue interference from senior World Bank staff in changing rankings of specific countries, it said on Thursday.
No irregularities have been found in Indian data, a commerce and industry ministry official said.
“India remains the preferred investment destination for the world and a reliable, trustworthy destination, while China is slipping in attractiveness. Fraud by China will prompt multilateral initiatives such as the Supply Chain Resilience Initiative (SCRI) to move manufacturing to India,” the official contended.
World Bank’s reports have been mired in controversy in recent years, with former chief economist Paul Romer resigning from his post in January 2018, claiming that the methodological changes in compiling the report led to a downgrade in socialist Chile’s ranking.
World Bank hired American law firm Wilmerhale, which studied 80,000 documents and used extensive interviews to compile its 2018 and 2020 Doing Business rankings report. During a sensitive capital-raising year of 2017, China could leverage its clout and pressurize World Bank top management into reversing the fall from 78 to 85 of their ranking.
On instructions from thenpresident Jim Yong Kim and then chief executive officer Kristalina Georgieva, the Doing Business team was instructed to re-evaluate China’s data to keep the rank at 78.
“The entire episode once again exposes the rampant fraud on which Chinese data is built and the integrity of Indian statistics,” said the commerce and industry ministry official mentioned above.
The World Bank audit did not point out any fraud in India’s ranking. However, Kaushik Basu, who supervised the release of the reports during 2012-16 as the chief economist of World Bank, had said India had benefited from methodological changes, alluding to the “two big controversies” involving India’s rise from 130th place to 100 and Chile losing its ranking between 2016 and 2017.