Gujarat is the best state for Economic Freedom

Economic Freedom is a new measure of where an economy is headed. Based on work done by renowned economists – Milton Friedman and Michael Walker – an Economic Freedom of Indian states index was developed to understand where that state was headed.

Economic Freedom of the States of India 2012 report demonstrates the significant differences in economic governance that exist in India. It thus has focused attention on state-level reforms to improve inclusive economic growth. The Index is based on the Fraser Institute’s Economic Freedom of the World report. This was developed on the ideas of Milton Friedman, Michael Walker and others who wanted an empirically sound way to measure whether economic freedom would lead to better economic and social outcomes. This has indeed been conclusively demonstrated, and the index has become an important contribution to the international policy debate. Its success has inspired researchers to come up with sub-national indices to capture the performance of sub-national institutions in China, Germany and elsewhere. The Friedrich-Naumann Stiftung has been engaged in developing an Economic Freedom Index for the states of India for several years now. This index has become an important part of India’s reform discourse.

In this study, the state of Gujarat has emerged as a winner amongst the states in India.  This helps one understand why all the major countries and companies want to line up at the door of Narendra Modi to get a piece of the pie.

Top 10 States

One understands that there is a whole industry in India and outside which demonizes everything to do with Gujarat and Narendra Modi, but it is important to understand the role that Modi has placed in Gujarat’s emergence and instilling of pride in common Gujarati person.

Bihar’s Nitish Kumar is supposed to be the other “bright kid” on the block.  And Bihar comes in at lowly 20th in this list.

One needs to understand that this index is more of a future looking measure which points to where a state (or nation) is moving to.

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