India’s Progress in Human Development

Syllabus: GS 3/Economy 

In Context

• The promise of development has emerged as a rallying point for political parties for the elections. 

About Human Development

• Development is essentially a favourable atmosphere for common people in which they can develop and expand their capacities. 
• The concept of human development was introduced by Dr Mahbub-ul-Haq.
  • Dr Mahbub-ul-Haq and Prof Amartya Sen have worked together to bring out the initial Human Development Reports.
  • The basic goal of development is to create conditions where people can live meaningful lives.
    • It enlarges people’s choices and improves their lives. 

Data Analysis 

• The Human Development Report 2023-24, published by the United Nations Development Programme, takes a comparative perspective and maps the achievements in the area of human development.
  • India ranked 134 out of 193 countries in the UN Human Development Index (HDI) in 2022, which was an improvement compared to 2021, when it ranked 135 out of 192 countries. 
  • Between 1990 and 2022, India witnessed an increase in HDI value by 48.4%, that is, from 0.434 in 1990 to 0.644 in 2022.
  • However, even though India moved up a rank compared to 2021, it still fell behind Bhutan, Bangladesh, Sri Lanka, and China.
• A paper published by the World Inequality Lab in March 2024 provides long-term trends in income and wealth inequality in India between 1922 and 2023.
  • It shows that the bottom 50% were getting only 15% of India’s national income in 2022-23. According to the study, “The top 1% earn on average 5.3 million, 23 times the average Indian (INR 0.23 million). 
• 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.
  • However, India also has one of the largest gender gaps in its labour force participation rate as there exists a 47.8% difference between women (28.3%) and men (76.1%).
• Household debt levels in India reached a record high of 40% of GDP by December 2023, and the net financial savings plunged to 5.2% of the GDP, 

Concerns and Challenges

• The failure of collective action to advance action on climate change, digitalisation or poverty and inequality not only hinders human development but also worsens polarisation and further erodes trust in people and institutions worldwide.
  • Inequality between countries at the upper and lower ends of the HDI started to increase each year since 2020. 
• High poverty levels, low literacy rates, and poor healthcare infrastructure being the contributing factors. 

Conclusion and 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. 
• Governments must prioritise human development alongside economic growth to ensure that the benefits of growth are more evenly distributed
  • This requires a multi-faceted approach that addresses income inequality and gender inequality; improves access to quality social services; addresses environmental challenges; and provides for greater investment in social infrastructure such as healthcare, education, and basic household amenities including access to clean water, improved sanitation facility, clean fuel, electricity and Internet in underdeveloped States.