Human Development Index – Increasing Divergence..

The Human Development Index (HDI) report released by United Nations Development Programme (UNDP) yesterday paints a stark picture of inequality across the globe. While humanity has managed to bring a large number of people out of extreme poverty, newer forms of inequality have emerged. More worryingly, countries with low HDI not only have a low level of income, but also lower life expectancy which is as much as 20 years. Here is a look at some of the details and India’s standing.

UNDP measures three essential parameters to arrive at HDI – Life expectancy, level of education measured by number of years of schooling and standard of living measured as per capita income. The report looks at the statistics for a total of 189 countries. Norway tops the list with HDI of 0.954 which corresponds to life expectancy of 82.3 years, average schooling of 18.1 years and per capita income of $68,000 (PPP). Niger stands the last with score of 0.377 and has expectancy of 62 years, schooling of 6.5 years and income of $912. India stands at No 129, one notch above last year, with expectancy of 69.4, schooling of 12.3 and income $6,829.

Other than individual countries, report looks at regional HDI also which gives a better view. As per this, OECD (Organization for Economic Co-operation & Development) countries have life expectancy of 80.4 years, schooling of 16.3 years and income of $40,000. In contrast, LDCs (Least Developed Countries) have expectancy of 65 years, schooling of 9.8 years and income of $2,630. for Sub-Saharan Africa has the worst life expectancy at 61.2 years.

However, the above figures provide very simplistic view of the data generated by HDI which runs into over 50 data points spread across ten tables! Some of these are inequality adjusted HDI (IHDI), Gender Development Index and Gender Inequality Index (GII) and Multidimensional Poverty Index (MPI), each based on variety of parameters. For instance, IHDI measures inequality within the country in level of life expectancy, education, income share of poorest 20%, top 10%, top 1% and Gini coefficient. Other tables look at factors leading to better score on the three core parameters such as number of physician and hospital beds per thousand population, pupil-teacher ratio, trained teachers, subject score for 15-year olds (!), percent population with vulnerable employment, population with access to electricity, sanitation etc. Yet another set of tables look at environment and socio-economic sustainability, each measuring 10-12 parameters. It may be noted that many of these parameters correspond to sustainable development goals (SDG).

IHDI captures variation within the country for all the three parameters separately. For instance, Hong Kong SAR (China) stands No 4 but is placed much lower at No 21 in terms of IHDI. Norway tops the chart even on this count. Surprisingly, India ranks one notch above on this although all the countries have lower value for IHDI. For Norway, inequality in life expectancy is only 3% which is 20% for India and goes beyond 30% for low HDI countries. While the inequality in education is in low single digits for high HDI countries, it goes beyond 40% for LDCs and is disappointing for India at 38.7%.

In terms of GII, Switzerland tops the list with higher life expectancy for female and nearly same level of schooling. However, per capita income differs significantly at $50,000 and $70,000. India is ranked slightly better at No 122 on this count with higher life expectancy and more years of schooling for female. However, income for female is much lower at $2,600 against $10,700 for male. Even the global average is $11,200 for female against $20,200 for male. The report, however, says that these are crude estimates. Multidimensional poverty index measures percent of population below the poverty line, intensity of deprivation, population vulnerable to poverty etc. While Europe and East Asia has only 1.1% below poverty line, it is as high as 57.5% for Sub-Saharan Africa, that too, with a high intensity of deprivation at 55%. India ranks quite poorly on this with poverty figure of 27.9% and severity of deprivation of 44%

Other than the country wise ranking on specific parameters, the report also looks at the development in a holistic manner. It has spent considerable amount of space on how children from poor families remain in the vicious cycle of development. They may not be able to afford an education and are at a disadvantage when they try to find work. These children are likely to earn less than those in higher income families when they enter the labour market, when penalized by compounding layers of disadvantage. The report rues, “They watch from society’s side-lines as they see others pull ahead to ever greater prosperity and people well empowered today appear set to get even farther ahead tomorrow”.

Other than the basic capability, the development also takes into account the enhanced capability, such as life expectancy at 70 years of age, which requires advance medical care, level of tertiary education which requires certain level of prosperity and of course, access to broadband. While mobile penetration has reached a level of 67% in low HDI against 137% for high HDI, there is a huge gap in the related enhanced capability – broadband penetration. This stands at less than 1% for low against 28% for high HDI. Worse, the chances are that the gap would increase over time.

An important point mentioned by the report is that policies to tackle economic inequality require much more than a mechanistic transfer of income corroborated by an interesting figure related to impact of income distribution across countries with different HDI. While taxes & transfers led to 17-point reduction in the Gini coefficient across the developed countries, the same was only 4 point in case of developing countries, a result of inefficient government mechanism and leakages.

Full report can be accessed at – http://hdr.undp.org/sites/default/files/hdr2019.pdf

Leave a Reply

Your email address will not be published. Required fields are marked *