Mr. Rebates

Tuesday, November 16, 2010

Poor human development continues to mar India’s growth story

Corruption has everything to do with poor human development, how many more years must Indians suffer like this? It has been 65 years since Independence, its high time the buck stops here!

India’s economy is in the top 10 in terms of growth potential, but when it comes to quality of life, especially in health and education, the country ranks 119 among 169 nations, according to the latest Human Development Index released by the UN Development Programme

India ranks among the top 10 global countries on income gain, but widening disparity between the rich and poor and gender inequality have been identified as major challenges, in a United Nations report recently released.

The Human Development Report 2010 said India gained 15 positions on the global Human Development Index (HDI) because of high income growth since 1970. However, on overall HDI, Nepal, being the second fastest HDI gainer globally, did much better.

The Real Wealth of Nations report incorporates a Multidimensional Poverty Index (MPI) and Gender Inequality Index (GII) along with Gross Domestic Product (GDP) in a methodology devised by Nobel Laureate Amartya Sen and Pakistani economist Mahbub ul Haq to measure HDI in this year’s report, which is in its 20th year.

“Economic growth has been impressive, but inequality is on the rise,” said Patrice Coeur-Bizot, UN representative in India. The report shows that there was a 30% loss in India’s HDI value when adjusted for inequality.

There are 42 countries listed as very high in human development. The 10 top achievers are Norway, Australia, New Zealand, the US, Ireland, Liechtenstein, the Netherlands, Canada, Sweden and Germany.
At the bottom of the human development list are the Central African Republic, Mali, Burkina Faso, Liberia, Chad, Guinea-Bissau, Mozambique, Burundi, Niger, the Democratic Republic of Congo, and Zimbabwe.

India ranks 119th among 169 countries, well below comparable emerging economies and even behind poorer neighbours such as Sri Lanka and the Maldives. Other emerging economies like Russia (69th), Brazil (73rd) and China (89th) score well above India. In value terms, India moved to 0.519 from 0.512 last year. But its rank remains unchanged under a revised method of calculating the index.

The Multidimensional Poverty Index -- which identifies serious simultaneous deprivations in health, education and income at the household level, in 104 countries -- shows that around 55% of Indians are poor. The country ranks 122 among 138 countries. Of the total poor, a majority of who live in rural India, 47% are tribals. Further, eight Indian states are home to 421 million multidimensionally poor people, more than the figure of 410 million in 26 poorest African countries. The states include Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh, often referred to as the BIMARU states.

The report’s new inequality-adjusted HDI, measuring inequality across 139 countries, shows South Asia with an average 33% loss due to inequality in health, education and income -- the second largest for a development region after sub-Saharan Africa. India loses 30% overall on the inequality-adjusted HDI, including 41% in education and 31% in health.

On the Gender Inequality Index, which was launched this year, India is ranked 122nd out of 138 countries, based on 2008 data. The report says 27% of adult women in India have a secondary or higher level of education, compared with 50% of men. For every 100,000 live births, 450 women in India die from pregnancy-related causes, while the adolescent fertility rate is 68 births per 1,000 live births. Female participation in the labour market in India is 36%, compared with 85% for men.

The Multidimensional Poverty Index spotlights countries that made the greatest progress in recent decades as measured by HDI, with China, Nepal, Indonesia, Lao PDR and South Korea making it to the “Top 10 Movers” list.

Among South Asian countries, Nepal is second among the top movers on non-income HDI, while India is among the top 10 movers in GDP growth. In India, 55% of the population already suffers multiple deprivations, while another 16% is vulnerable to it. The report says Delhi’s rate of multidimensional poverty is close to that of Iraq and Vietnam, while that of Bihar is similar to that of Sierra Leone and Guinea. About a third of other Indian households are multidimensionally poor, with an MPI just below that of Honduras.
While India stands at 10 in the top 10 movers in HDI in terms of improvements in income, it does not figure in the top 10 movers list on health and education. N R Bhanumurthy, professor at the think-tank National Institute of Public Finance and Policy, said India’s poor HDI rank reflected a skewed development focus.
“Our policies have been concentrating more on economic growth, neglecting the social sectors. That is why the Eleventh Five-Year Plan (2007-12) tried to bring in the concept of inclusive growth. The policies are now in place; however they have not been implemented whole-heartedly. That is why our ranking is so poor,” he said.

The world’s biggest job programme, the National Rural Employment Guarantee Scheme, got special mention for improving income in rural India. But the report said the extent of the gains from economic liberalisation for society as a whole needed careful investigation. The limited reach of public healthcare among the poor, and teacher absenteeism in public schools were cited as major constraints.

The HDI report holds that current consumption and production patterns worldwide are not environmentally sustainable in the long term. By mid-century, the adverse effects of climate change on grain yields will push prices up -- more than doubling the price of wheat -- with massive repercussions.

South Asia continues to be poor on overall HDI indicators, with half the world’s poor in this region. The region is characterised by relatively weak female empowerment with an inequality loss of 35% compared to 16% in developed countries.

Source: The Economic Times, November 8, 2010

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