Question – Despite the continuous trend of high growth, India still remains at the low rank of Human Development Index. Examine the issues which make the path of balanced and inclusive development difficult. – 2 September 2021
India is one of the largest economies in the world today. However, according to the United Nations Human Development Index Report-2020, India is ranked 131 out of 189 countries. India has developed rapidly since 1991. While India is leading in terms of GDP growth, it is performing poorly on the human development front. This means that millions of Indians lack access to healthcare and education compared to more advanced countries or even emerging economies like BRICS.
‘Human Development’ is best computed by the United Nations Human Development Index and the World Bank Human Capital Index. Whereas, economic growth is measured by Gross Domestic Product (GDP) or Gross National Product (GNP). It is also true that a strong relationship exists between economic growth and human development because economic growth provides the resources necessary to allow continuous improvement in human development.
Issues that make balanced and inclusive development elusive:
- Jobless Growth: Since India’s development is led by services (which is not a labor intensive sector), it is considered as jobless growth. This is because employment growth/creation has declined relative to the same level of economic development. Thus development has affected only a very small section of India.
- Uneven Growth: The magnitude of growth has often been uneven across regions and locations. For example, agriculture is lagging behind and some sectors have progressed faster than others. The agriculture sector is also relatively neglected in policy making.
- Gender Inequality: In a highly patriarchal country like India one cannot expect India to have a high standard on gender equality. 50 percent of malnutrition is not due to lack of food or poor diet, but to poor water, poor sanitation and unhygienic practices.
- Malnutrition: Despite several government schemes, both the infant mortality rate and the maternal mortality rate remain high. There is a high prevalence of malnutrition among Indian children, which is reflected in a high percentage of stunting, wasting and underweight. The neglect of women’s health in particular is a big issue. In addition, India has the highest number of deaths in the world due to air pollution.
- Unequal distribution of resources: In the last five years, only 1% of the richest people in India have increased their wealth by almost 60% and the richest 10% in India have four times more wealth than the remaining 90%. This results in unequal distribution of wealth among different sections of society and reflects the prevalence of high inequality in the Indian socio-economic paradigm leading to non-inclusive growth and low human development.
- Poor education and health: Compared to similar emerging economies, India has a relatively low budget in the education and health sector. India spends 3% of GDP on education and 1.5% of GDP on health. Independent India retained a largely colonial superstructure of primary, secondary and tertiary education, which emphasized rote learning along with examination marks. As a result, access, quality and results all have the lowest performance.
- India needs to ensure accessibility and quality in the country through effective implementation of schemes like Digital India and Skill India.
- For a higher standard of living, it should be ensured that the work in the country increases both quantitatively and qualitatively. The country’s efforts in terms of employment guarantee schemes have been lauded for the role of policies in reducing unemployment, but it is still by no means a long-term measure.
- The Government of India should also focus on improving the quality and accessibility of education. Education has a major role in promoting inclusive economic growth. This can especially help in reducing the share of informal employment and promoting social inclusion going forward.
- India urgently needs to reform its harsh labor market governed by obsolete laws, address the problems of child labor and forced labor, and bring about wage parity.
- Efforts are needed to increase energy and resource efficiency, particularly through reduced fossil fuel subsidies, and to accelerate the adoption of clean technologies.
- The government should make efforts to bridge the digital divide, as it leads to socio-economic backwardness.
Human development and economic development are correlated with each other as a cause and effect. Therefore, without investing in human capital and addressing the current economic slowdown, the goal of becoming a $5 trillion economy will remain a dream for India.