Mr. Rebates

Friday, November 5, 2010

India still low in human development index, in top 10 on income growth

Nov 5, 2010

The Human Development Report (HDR) 2010, released by the UNDP today, highlighted India as among the 10 countries that showed the fastest progress in human development, in terms of income-related measures, between 1970 and 2010. In fact, in an indication of the changing geography of economic growth, eight out of the top 10 improvers are from East, Southeast and South Asia (China was first). Botswana and Malta are the only two countries from outside these regions that figure in the list. 

However, oddly, the Report clubs India along with 20 other countries where a potential for exposure to “civil war” imposes limitations on “freedom from fear”. While Afghanistan, Pakistan, Sri Lanka and Colombia are categorised as countries with “major civil war” threats, India is put into a league with Burundi, Mali, Sudan, Myanmar, Iran and Israel among others in a “minor civil war” threat category (for those with civil conflicts that have resulted in fewer than 1,000 deaths). 

India, otherwise, is ranked as a “Medium Human Development” country, and is 119th of 169 territories listed in the 2010 report. Norway, at the top, has a Human Development Index (HDI) value of 0.938; India’s is 0.519. The Report points out that India’s ranking has improved by only a single spot between 2005 and 2010. In other words, while income-related factors have done well, India has performed relatively poorly on the other indicators.
Neighbouring China and Nepal have been highlighted as the countries that have made the greatest progress in improving their HDI value. China is ranked 89 and has a middle-level HDI of 0.663. Nepal, at 0.428 is ranked low, at 138. Yet Nepal is the second-best performer in terms of improving the non-income aspects of human development, despite its record of civil insurgency. The Report ascribes this to a “major public policy push”. Free primary education from 1971 and secondary education in 2007 meant enrolment and literacy soared; health improved through “the extension of primary healthcare through community participation, local mobilisation of resources and decentralisation.” Pakistan, meanwhile, has been ranked 6 places below India, with an HDI of 0.490.
The 2010 report introduced the inequality-adjusted HDI (IHDI), described as measuring human development after accounting for inequality in the distribution of health, education and income. While the average loss in the HDI value when adjusted for inequality is about 22 per cent, India loses about 30 per cent of its HDI value, from 0.519 to 0.365. The Report says 40 per cent of this loss is because of inequality in education, while over 31 per cent is inequality in health. Income inequality slices off only about 15 per cent. 

The Report also highlights variations within India, comparing the level of “multi-dimensional poverty” — in which the poor also lack access to health and education — across regions and castes. Delhi is comparable to Iraq or Vietnam, while Bihar is like war-torn Sierra Leone. Meanwhile, 81 per cent of Scheduled Tribes are multi-dimensionally poor, compared to one-third of upper-caste households, who collectively are at the HDI level of middle-income Honduras. The “intensity and incidence” of poverty, the Report says, is greater in South Asia than in any other region. 

The Report makes a case for extending the domain of economic policy to all forms of well-being, including political participation. The NREGA, in a section authored by Jean Dreze and Reetika Khera, finds a mention. Interestingly, the Report tackles the “income-first” approach of China, an intellectual challenge to HDI-based thinking, head-on. It points out that early in China’s reform period “public social services deteriorated and in some places even collapsed.” It goes on to argue that in the last decade, China has changed focus. In 2002, Amartya Sen’s Development as Freedom, an attack on China-style policies, was translated into Chinese; and, when healthcare was being reformed in 2005, a crucial expert-group at the ministry of health was asked to read the book, the most prominent exposition of the Sen-Haq thesis that human capabilities and opportunities are what matter.

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