India's ranking has slipped further to 81 in the list of Global Innovation Index, compared to 76 in 2014, on account of factors like consistently poor performance in ease of doing business, slow pace of policy decision-making and changing political environment.
The study, which ranked 141 economies across the world on their innovation capacity and efficiency, however, said that India has outperformed its peers in the Central and Southern Asian Region (CSA) and positioned itself as innovation achiever in the lower-middle income category.
Switzerland, the UK, Sweden, the Netherlands and the US are the world's five most innovative nations, according to the Global Innovation Index 2015, while China, Malaysia, Vietnam, India, Jordan, Kenya, and Uganda are among a group of countries outperforming their economic peers.
The GII study, released today, was published by Cornell University, INSEAD France and World Intellectual Property Organization (WIPO).
Over the last four years, India has witnessed a reduction in its overall GII ranking, which dropped from 62nd place in 2011 to 76th in 2014.
"This change in ranking can be primarily attributed to two major factors. The first concerns the changing dynamics of the country's political, educational and business environment, and the second concerns the structural change GII has undergone to improve itself as an assessment tool over the years," the GII report pointed out.
According to GII data, the input parameters in which India has consistently performed poorly during the last four years are political stability, ease of starting a business, tertiary inbound mobility, and environmental performance.
However, CII Director General Chandrajit Banerjee said the relative fall in India's overall ranking this year is due to availability of old data upto 2103-14 period, and it does not truly reflect the performance of the economy in last one year.
"We believe that with the present growth trend the future ranking for India is going to improve as the data get revised and as the government continues to perform towards a development oriented growth path," he said.
However, according to the GII report, the findings resonate with the general Indian public's perception that the government has been relatively inactive during this period in terms of making policy decisions.
Among the reasons for this inactivity is the slowdown experienced in the overall economy, the country's high inflation, and clamour over severe corruption charges against the incumbent government, the report said.
Weaknesses that are underscored in the GII occur in the area of ease of starting a business -- a persistent matter of contention in India -- which presents regulatory hurdles to entrepreneurs through a highly complex compliance regime and heavy bureaucratic interference.
However, the GII cites mobile networks, information technology and broadband as areas in which India has leapfrogged, leaving others in its category behind.
