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World Governance Indicators


World Governance Indicators UPSC: Relevance

  • GS 2: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.


World Governance Indicators World Bank: Context

  • Recently, World Bank’s World Governance Indicators found that India’s scores were “much below” its peers on all counts.

विश्व शासन संकेतक

What is World Governance Indicators?

WGI provide a ranking of 215 countries territories based on six dimensions of governance:

  • ‘Voice and Accountability’;
  • ‘Political Stability and Absence of Violence’;
  • ‘Government Effectiveness’;
  • ‘Regulatory Quality’;
  • ‘Rule of Law’ and
  • ‘Control of Corruption.’


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World Governance Indicators data: Key points

  • In an analysis of the World Bank’s World Governance Indicators, Ministry of Finance reported, through a presentation, that factors noted in the Freedom House report also led to the country receiving the largest score decline among the world’s 25 largest democracies in 2020.
  • The presentation showed the government felt there was a danger India may witness a drop in WGI scores “due to the latest negative commentary on India by think tanks, survey agencies and international media.
  • The presentation noted India’s WGI score is much below the BBB Median on all six indicators.
    • BBB is an investment-grade rating issued by global rating agencies such as S&P and Fitch.



About Credit rating agencies

  • A sovereign credit rating is an independent assessment of the creditworthiness of a country or sovereign entity.
  • It can give investors insights into the level of risk associated with investing in the debt of a particular country, including any political risk.


World Governance Indicators methodology: Negative reporting by international agencies

  • Freedom House Report 2020 mentioned alarming setbacks in the world’s largest democracy. It highlighted that “a series of actions by India’s Hindu nationalist government in 2019 violated democratic rights in India and Indian Kashmir”.
  • The US State Department mentioned that in 2018, the government harassed and at times prosecuted activists, lawyers, human rights defenders and journalists for criticising authorities. Draconian sedition and counterterrorism laws were used to chill free expression.
  • Economic Intelligence Unit (EIU) reported that India slipped to the 51st place from 42nd on EIU’s 2019 Global Democracy Index and remains classified as ‘flawed democracy’.
  • In the Bertelsmann Transformation Index (BTI), the government noted that under ‘Political Transformation’: “From being in the top category of ‘Democracies in consolidation’ in 2014 we have fallen to ‘Defective Democracy’.”
  • In the Heritage Foundation Index of Economic Freedom, the presentation noted “India’s Economic Freedom Score has been “Mostly Unfree” since Heritage Foundation started publishing data in 2008.”


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World Governance Indicators databank: Countering negative perception

  • The Finance Ministry’s economic division is drafting a strategy to counter the negative commentary on India by global think-tanks, indices and media, amid worries this could lead to downgrading of sovereign rating to “junk”.
  • In June 2020, then Principal Economic Advisor in the Ministry of Finance, Sanjeev Sanyal, prepared a presentation on the subjective factors that impact India’s sovereign ratings for internal circulation within the government.


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