UPSC EDITORIAL ANALYSIS : Giving primacy to human development
Kartavya Desk Staff
Source: The Hindu
• Prelims: Current events of national importance(HDI, UNDP, Different social service Schemes, MPI)
• Mains GS Paper I & II: Social empowerment, development and management of social sectors/services related to Health, poverty and hunger etc
ARTICLE HIGHLIGHTS
• The Human Development Index (HDI) report stated that India ranked 135 in 2021, it had moved up to 134 in 2022. A total of 193 countries were ranked in 2022 and 191 countries in 2021.
• A total of 193 countries were ranked in 2022 and 191 countries in 2021.
INSIGHTS ON THE ISSUE
Context
Human Development Index:
• HDI is a composite index that measures average achievement in human development taking into account three indicators: Life expectancy at birth (Sustainable Development Goal (SDG) 3) Expected years of schooling (SDG 4.3), Mean years of schooling (SDG 4.4) Gross national income (GNI) (SDG 8.5).
• Life expectancy at birth (Sustainable Development Goal (SDG) 3)
• Expected years of schooling (SDG 4.3), Mean years of schooling (SDG 4.4)
• Mean years of schooling (SDG 4.4)
• Gross national income (GNI) (SDG 8.5).
India and HDI:
• India ranked 134 out of 193 countries in the UN Human Development Index (HDI) in 2022, Improvement compared to 2021, when it ranked 135 out of 192 countries. One point increase is attributed to a marginal increase in HDI value to 644 in 2022 from 0.633 in 2021.
• Improvement compared to 2021, when it ranked 135 out of 192 countries.
• One point increase is attributed to a marginal increase in HDI value to 644 in 2022 from 0.633 in 2021.
• It places India in the medium human development category.
• Between 1990 and 2022, India witnessed an increase in HDI value by 4%, that is, from 0.434 in 1990 to 0.644 in 2022.
• It fell behind Bhutan, Bangladesh, Sri Lanka, and China.
• The medium human development category of countries includes Myanmar, Ghana, Kenya, Congo and Angola.
• The index on which India registered an improvement is the Gender Inequality Index.
• In 2022, India was ranked 108 out of 193 countries, while in 2021, it ranked 122 out of 191 countries.
• India has one of the largest gender gaps in its labor force participation rate as there exists a 8% difference between women (28.3%) and men (76.1%).
Issues highlighted in the Report:
• It raises concerns on rising inequality and its implications for advancing human development.
• Inequality between countries at the upper and lower ends of the HDI started to increase each year since 2020. This divergence is compounded by substantial economic concentration Almost 40% of the global trade in goods is concentrated in three or fewer countries.
• This divergence is compounded by substantial economic concentration
• Almost 40% of the global trade in goods is concentrated in three or fewer countries.
• In 2021, the market capitalisation of each of the three largest technology companies surpassed the GDP of more than 90% of countries that year.
• Report states: “The share of people reporting having very high control over their lives is low and relatively equal for the bottom 50 percent of the population, but rises with income for deciles 6 and above. Thus, income inequalities, which often intersect and are associated with other inequalities in human development, shape agency.” Agency increases as income grows for the bottom 50% of the distribution.
• Thus, income inequalities, which often intersect and are associated with other inequalities in human development, shape agency.”
• Agency increases as income grows for the bottom 50% of the distribution.
• When adjusted for inequality, India’s loss in HDI is 31.1%, which is higher than that of Sri Lanka, Bangladesh, Nepal and Pakistan.
The World Inequality Lab study:
• It shows that the bottom 50% were getting only 15% of India’s national income in 2022-23.
• The top 1% earn on average 5.3 million, 23 times the average Indian (INR 0.23 million).
• Average incomes for the bottom 50% and the middle 40% stood at INR 71,000 (0.3 times national average) and INR 1,65,000 (0.7 times national average) respectively.
• The richest 10,000 individuals (of 920 million Indian adults) earn on average INR 480 million (2,069 times the average Indian)”.
Implications:(On the aggregate demand and consumption and on human welfare):
• Percentile of the income distribution shows that growth for the top decile has been significantly higher than the rest of the population.
• Within the top 10%, growth rates rise with rank indicating that those at the very top benefited much more than the others.
• During 2014-2022, the incomes of the middle 40% of the income distribution seem to have grown slower than the bottom 50%.
• It indicates a possibility of the reduction in the size of the ‘middle class’.
• When growth gets very concentrated at the top, the pace of economic polarization accelerates eventually resulting in the emergence of two classes, the haves and have-nots.
Government initiatives:
Way Forward
• Given low levels of human development, high levels of inequality, low savings and high debt, it is time to think about an alternate growth strategy which accords primacy to human development and convert it as a route to accelerate growth.
• This needs political will and thinking beyond short-term electoral gains. As a first step towards this, the narrative of development needs to be recast.
• There is a need to supplement the results of consumption surveys with a study of the impact of public expenditure on health and education of different expenditure classes.
QUESTION FOR PRACTICE
Can the vicious cycle of gender inequality, poverty and malnutrition be broken through microfinancing of women SHGs? Explain with examples.(UPSC 2021) (200 WORDS, 10 MARKS)
Editorial Analysis – 9 May 2024