The index, produced by the Milken Institute, looked at categories such as economic fundamentals, institutional framework and international standards and policies.
It found that the Kingdom performed as well as high-income countries in business constraint, which includes the cost and effectiveness of starting a business, and the future environment of growth.
The authors of the index noted that Bahrain and Oman are attempting to diversify quickly away from oil and gas, while other GCC countries such as the UAE and Kuwait, who have larger reserves, are not.
Want to find out more about Bahrain’s relationship with oil? An exhibition has just opened at the Bahrain National Museum that does just that.