India’s low HDI rank and associated concerns

Human Development Index (HDI) is an important development index released by United Nations Human Development Programme. It serves as a crucial index for social parameters and thus helps guide nation’s w.r.t. policy actions and guidelines.

The HDI is a composite index measuring average achievement in three basic dimensions of human development—a long and healthy life, knowledge and a decent standard of living.

According to the UN Development Programme’s Human Development Report 2016, released on Tuesday (March 21), India ranks 131 of 188 when it comes to the Human Development Index (HDI). This puts it in the ‘medium’ category. The index is based on three dimensions: life expectancy at birth, mean years of schooling and expected years of schooling, and gross national income per capita.

India’s HDI, at 0.624, makes it as the third SAARC country on the list, behind Sri Lanka and Maldives (both of which fall in the ‘high’ HDI category).

With a human development index value of 0.64, India has been put under the “medium” development category. In 1990, India’s HDI was 0.428 – there has been an over 45% increase in the HDI value.

Among the BRICS countries, India came second to China which recorded the highest improvement in HDI value – 48%. Norway topped the list with the highest HDI value (0.949), while Australia (0.939) and Switzerland (0.939) followed.

A long and healthy life, access to knowledge and a decent standard of living are the important factors to calculate the HDI value of a country.

The report said that since 2005, India has introduced many progressive acts, including the right to education, work, information, food and public services. “These acts have been marked by their explicit use of rights-based claims and by the design of innovative governance mechanisms that seek to enhance the transparency, responsiveness and accountability of the state,” the report said.

However, the report noted that ending subsidies to the rich can free resources for human development. “In 2014, the richest 20% of India’s population enjoyed subsidies of $16 billion thanks to six commodities and services,” it said. The infant and under-five mortality rate have improved in India, the report added.

Key Facts

• Top three countries: Norway (0.949 score), Australia (0.939) and Switzerland (0.939).
• SAARC countries: Sri Lanka (73) and Maldives (105) were placed in “high human development” category, followed by India (131), Bhutan (132), Bangladesh (139), Nepal (144), Pakistan (147) and Afghanistan (169).
• BRICS Countries: India ranks lowest among BRICS nations. Russia (49), Brazil (79), China (90), South Africa (119) and India (131).
• India related facts: India’s HDI value increased from 0.428 in 1990 to 0.624 in 2015. However, its average annual growth in HDI (1990-2015) was higher than that of other medium HDI countries.
• In 2015 HDI, India ranked 130 with score of 0.609 and was placed in the medium human development category.
• Life expectancy at birth: In India, it has increased from 68 years to an average of 68.3 years — 69.9 years for women and 66.9 years for men.
• Access to knowledge: India’s expected years of schooling remains at 11.7 years, while mean years of schooling increased from 5.4 to 6.3 years.
• India’s Gross National Income (GNI) based on per capita purchasing power parity (PPP): It has risen from $5,497 to $5,663.
• Gender Inequality Index (GII): India ranked 125 among 159 countries. Only 12.2% of Parliament seats are held by women.
• 8% of women above the age of 15 years are part of India’s labour force — compared to 79.1% men.
• The ratio of maternal mortality is 174 against every 100,000 live births.
• Inequality-adjusted Human Development Index (IHDI): It is difference between the HDI and IHDI, expressed as a percentage of the HDI, indicating the loss in human development due to inequality.
• India’s HDI was pegged at 0.624, but its value falls 27.2% after being adjusted for inequalities, resulting in a HDI value of 0.455.
• Life expectancy adjusted with inequalities between 2010 and 2015 fell 24%, resulting in a value of 0.565.
• The percentage of inequality in education in 2015 was 39.4% or 0.324 and inequality in income 16.1% or 0.512.

Issue

• India’s HDI has been increasing over the years, the report says, with an increase of close to 46% between 1990 and 2015.
• It’s HDI rank has risen by four places since 2010.
• India’s rank of 131 among 188 countries on the UNDP’s Human Development Index for 2015 and its ‘medium’ performance pose the uncomfortable question:
• Would not the score have been significantly better if the higher economic growth trajectory of two and a half decades of liberalisation had been accompanied by a parallel investment in people?
• Few will argue that the rise in incomes that came with a more open economy has not translated into a
• Higher quality of life for many Indians
• Raised overall life expectancy at birth by more than 10 years from the 1990 level, to reach 68.3 years.
• Progress has also been made in raising awareness about issues affecting women’s empowerment, such as
• Public safety
• Acid attacks
• Discrimination in inheritance rights
• Lack of equal employment opportunity
• Policy reforms have been instituted in some of these areas as a result.
• As the HDI data show, significant inequalities persist, particularly between States and regions, which act as major barriers to improvement.
• The percentage of women in the workforce is the lowest in India among the BRICS countries,
• The national record on the population that lives in severe multidimensional poverty is also the worst in the bloc.
• These are clear pointers to the lost decades for India, when universalisation of education and health care could have pulled deprived sections out of the poverty trap.

Challenging inequalities

• This year’s report focuses on the increasing inequalities globally, which has led to a stunting of HDI growth. “This report uncovers a deeper story behind the statistics,” said Haoliang Xu, director of the UNDP Regional Bureau for Asia and the Pacific, in a press statement. “Even in a region that has made such remarkable progress, pockets of exclusion continue to prevent millions of people from fulfilling their true potential.”
• In all regions, women have a lower HDI than men, despite having higher life expectancy at birth. Historically disadvantaged groups, such as Dalits and Adivasis in India, also have lower human development indexes. South Asia is a prime example of this, according to the report. When the region’s HDI is adjusted for inequality, its value falls from 0.621 to 0.449. For India specifically, this drop is from 0.624 to 0.454 – a fall of 27.2%. The average drop in HDI when adjusted for inequality in the South Asia region in 27.7%.
• South Asia’s Gender Development Index (GDI) is also the lowest across regions. The GDI takes into account the disparity between the HDI’s of men and women – the higher the disparity, the lower the GDI. India’s GDI is 0.819, compared to the developing country average of 0.913.

Gender Development Index across regions

• India is placed in the bottom of five categories of countries when it comes to gender parity, and is classified as having "low equality in HDI achievements between men and women". Women in India complete half as many years of schooling on average as men, and have less than half the share of men in the Gross National Income. It also ranks 125th of 159 countries on the Gender Inequality Index on account of the prevalence of teenage mothers, the low share of women in Parliament and the low female labour force participation rate compared to men.
• The report has also talked about the Multidimensional Poverty Index for various developing countries that takes into account factors including health facilities, educational opportunities, living standards, threat of violence and income.
• According to UNDP’s report, 55.3% of India’s population is living under multidimensional poverty, compared to 45.6% in Pakistan, 5.2% in China, 58.8% in Afghanistan and 40.7% in Bangladesh.
• South Asia also has the lowest public expenditure on health as a percentage of GDP, at 1.6%. India’s expenditure is even lower, at 1.4% of GDP.

Multi-Dimensional Poverty Index (MDPI)

• On the Multi Dimensional Poverty Index (a new measure to understand poverty as a range of deprivations), over half of Indians are classified as poor; however the data used for the calculations for India dates back to 2005-06 and newer data is likely to show a far lower proportion of people being defined as MDPI poor.
• The report also uses data from the Gallup World Poll 2016 which asked people around the world about their perception about their own well-being and their confidence in government. Indians reported being relatively satisfied with the education quality and jobs in India, but less satisfied with their standard of living, healthcare quality and feeling of safety. Confidence in the judicial system (74%) was higher than trust in the national government (69%).
• The world has come a long way in rolling back extreme poverty, in improving access to education, health and sanitation, and in expanding possibilities for women and girls," UNDP Administrator Helen Clark said in a statement at the launch of the report in Stockholm, "but those gains are a prelude to the next, possibly tougher challenge, to ensure the benefits of global progress reach everyone.
• "This report uncovers a deeper story behind the statistics," said Haoliang Xu, Director of the UNDP Regional Bureau for Asia and the Pacific. "Even in a region that has made such remarkable progress, pockets of exclusion continue to prevent millions of people from fulfilling their true potential."
• Yuri Afanasiev, UN Resident Coordinator and UNDP Resident Representative in India, noted India's impressive progress in its Human Development Index score, which rose by nearly half between 1990 and 2015.
• He said: "The success of national development programmes like Skill India, Digital India, Make in India and Beti Bachao Beti Padhao aimed at bridging gaps in human development will be crucial in ensuring the success of Agenda 2030. These programmes, and the long-running affirmative action measures, illustrate the government's commitment to identifying and mapping human development deficits, as well as taking action to achieve the Sustainable Development Goals."

Public health expenditure as % of GDP, 2014

• One of the ways in which India could tackle its inequality problem, the report says, is to stop subsidies that benefit the rich and use that money for social programmes. “In 2014 the richest 20 percent of India’s population enjoyed subsidies of $16 billion thanks to six commodities and services – cooking gas, railways, power, aviation fuel, gold and kerosene – and exempt-exempt-exempt tax treatment under the public provident fund,” the report says.
• The report also says that “nationalism and identity politics” – a surge in which can be seen in various parts of the world – is detrimental to the human development of the most marginalised sections. “Intolerance of others in all its forms – legal, social or coercive – is antithetical to human development,” according to the report.

Encouraging developments

• Despite the high level of inequality across the globe, the report says that encouraging developments can be seen in human development indicators across regions. A lot of this, they say, is because of progressive policies that focus on giving people their rights.
• The report commends India’s National Food Security Act, Mahatma Gandhi National Rural Employment Guarantee Act and the Right to Education Act, saying they have been instrumental in supporting the notion that development must be for everyone. It also praises the country’s affirmative action reservation policy, which “has not remedied caste-based exclusions, but has had substantial positive effects”.
• It also mentions India’s promise on clean energy investments, saying not only would this encourage a more sustainable development programme, it would also create jobs. “In India increasing clean energy investments by 1.5 percent of GDP a year for 20 years will generate a net increase of about 10 million jobs annually, after factoring in job losses from retrenchments in the fossil fuel industries,” the report says.

Policy actions and course corrections needed

• A central focus on social indicators is necessary for India to break free from its position as an underachiever.
• The fiscal space now available has been strengthened by steady economic growth.
• More should be done to eliminate subsidies for the richest quintile — estimated by the UNDP to be $16 billion in 2014 in six consumption areas including gold and aviation fuel.
• The rise in revenues from all sources should go towards making public education of high standards accessible to all and delivering on the promised higher budgetary outlay for health care.
• Bolstered by a conscious effort to help traditionally backward regions, such policies will help eliminate the losses produced by inequalities that lower national human development indices.
• One crucial metric that gets insufficient attention in the measurement of development is the state of democracy, reflected among other things in access to justice.
• It is relevant to point out that India has not ratified UN conventions on torture, rights of migrant workers and their families, and protection against enforced disappearance.
• This is a serious lacuna for a country that otherwise has a commitment to democracy and the rule of law.

Conclusion

• With the growing realisation that development is a multidimensional achievement, the gains of economic reforms must help build capabilities and improve the health of all sections. Sustaining and improving the quality of life will depend on policies crafted to handle major emerging challenges such as urbanisation, the housing deficit, access to power, water, education and health care.