Why Low Indicators of Human Development Despite High Growth in India ?

Updated June 17, 2022

Human development is defined as the process of enlarging people’s choices, “choices allowing them to “lead a long and healthy life, to be educated, to enjoy a decent standard of living, enjoys human rights and various ingredients of self-respect. Here, development concerns with the building of human capabilities in a way which enables them to lead longer, healthier, and fuller lives.

The development of human is measured by the Human Development Index, formulated by the United Nations Development Programme. The index comprises the statistics such as life expectancy at birth, an education index (calculated using mean years of schooling and expected years of schooling), and gross national income per capita.

While economic growth is measured by the Gross Domestic Product or Gross National Product here exists a correlation between Economic Growth and Human Development. Economic growth is one of the major aspects to improve the standard of living of people. However, faster economic growth is not seemed to raise the living standards of our teeming millions.

India after 1991 economic reforms showed remarkable economic growth. India’s story with consistent growth of the economy is commended, it is one of the largest economies in the world having a fastest-growing economy. Despite this, India shows the dichotomy between the high growth and human development index.

India is ranked 129^th in the Human Development Index among 189 countries released by the United Nations Development Programme (UNDP) in 2019. Factually, in spite of consistent high growth, India has failed to identify and rectify the various issues which perpetuate its low human development. So, this clearly states that the Indian economy has failed to achieve a trickle-down effect.

The Issue Making Balanced & Inclusive Development Elusive

There are plethora of issues that are responsible for failing India to achieve a balanced and inclusive growth. With economic growth, the Indexes of HDI is not picking up. The major issues are as below behind the prevailing contrast:

Rising Inequality of Wealth with Growth:

In the last 2-3 decades, India economic growth has been commended globally. But, the concentration of resources in one hand and rising inequality is prevalent. In the last five years analysis, only 1% of wealthiest in India increased their share in the wealth of around 60% and the richest 10% in India own more than four times more wealth than the remaining 90%.

Despite significant economic growth, India has the second-highest number of poor in the world. This has been due to highly uneven distribution of resources across the various sections of the society and it marks the prevalence of high inequality in the Indian socio-economic paradigm which led to Non-inclusive growth and low human development.

Marginalized sections unaffected by growth:

Prevalent discrimination in society against the marginalised sections, women, disabled is a major setback for the low human development index. The economic growth is not perceived as being adequately inclusive for many groups, especially Scheduled Castes (SCs), Scheduled Tribes (STs), and weaker section. So, the balanced development will not be inclusive if some groups are discriminated against, overtly or covertly.

Lack of Implementation of Policies/Schemes:

The poor implementation of policies or schemes in India shows the elusive balanced and inclusive development. Despite Food Security schemes, PDS, Food Subsidy implemented by the government, India is ranked 102 of 117 countries in the Global Hunger Index 2019.

Gender inequality is prevalent in India:

The key source of gender inequality is the gap in opportunities, achievements and empowerment between women and men. For example, the gender pay gap, low female literacy, female foeticide, low sex ratio.

Lesser Expenditure on Social Sectors by Government:

As compared to other similar emerging economies, India spends very less on health and education. India spends approximately about 4% of the total budget on education which is one of the lowest in the world. This results in low productivity, bad quality of education, poor learning outcomes etc. These sets of outcomes reflect that the quality of education is far from satisfactory. It means the economic growth lags the balanced and inclusive development.

Not only the condition of education is dismal, but also the health sector. Even after the implementation of many government schemes, the condition of the health sector is worst in India. You will see both the infant mortality rate and the maternal mortality rate remains high even after India is the fastest-growing economy.

India spends just 1.41 % of total GDP on health which is lowest among the BRICS countries. This has resulted in a single hospital for every 61 thousand, and one bed for every 1833 people. In the health sector, out of pocket expenditure is high, the focus is on curative rather than preventive healthcare. For Example, over 70% of health expenditure is met by out of pocket expenditure in India.

Jobless Growth:

Despite the economic growth of India is commendable, there has not been a similar rate of growth of employment. According to recently released PLFS sources, unemployment in India has been on 45 years high.

With rising population and, consequently, the labour force, India will soon experience demographic disaster rather than a demographic dividend. Also, according to ASSOCHAM, there is no deficiency of the adequate number of jobs, but the majority of the labour force doesn’t have adequate skills required by the market.

Huge Population-

A huge population is a burden on India. Though economic reforms, distributive policies of government have resulted in an increase in per capita income, the increase is insignificant due to the huge population.

Lack of Balanced Regional Development-

This is due to govt and industrial neglect of certain regions. Some regions are prosperous and others provide poor performance in the agricultural sector and also the failure of the growth pole model of setting heavy Industries has increased the imbalanced regional growth.

E.g. Haryana and Punjab- Prosperous in agriculturally sector, whereas Maharashtra, Karnataka and Gujarat are prosperous in the Industrial sector.

High informal employment which deprives the majority of the population of social securities and affects their quality of life.

Steps That Can Be Taken to Improve Human Development:

Inclusive growth and development are crucial keynotes to India’s success story. India’s national development scheme should aim to universalising school education and healthcare, empowering the women and reducing poverty, these will be crucial in ensuring that India accelerates its levels of human development and achieve the goal, inclusive and sustainable development. It means with right steps, India can do well to reap its demographic dividend and yet hit the right note to its growth.

What are The Needs for Inclusive & Balanced Growth ?

Some crucial measures that can help India achieve the inclusive & balanced growth are more important than others. We can agree together on the following:

(a) Policy-planning based on section, sector, a region with appropriate prioritization is important.
(b) India needs to focus on improving quality and access to education. The government must increase expenditure on education. Education has a major role in promoting inclusive and balanced development. It can particularly help reduce the share of informal employment going forward and promote social inclusion.

(c) Apart from holistic reforms in education, Right to Education must be accompanied by Right to Learning.
(d) The government needs to increase public health expenditure. Promotion of Primary health centre under Ayushman Bharat, which focuses on preventive healthcare is a step in the right direction.
(e) In terms of knowledge, India needs to ensure access and quality through the effective implementation of schemes such as Digital India and Skill India.

The Issues that Make Balanced and Inclusive Development Elusive for India