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Unequal India’s Skewed HDI

Unequal India’s Skewed HDI

The latest Human Development Index report has opened a door for optimism globally. The report asserts that people are living longer, have more access to education and earning more income. The rise in the HDI levels since 1990 is at an average 22%, and in the least developed countries there was an increase of 51%.

Keeping pace with the global trend, India registered a 50% increase in the last 17 years since the 1990s’ reforms of Liberalisation, Privatisation and Globalisation. However, all along India’s growth trajectory the one formidable roadblock that cripples the country’s march towards inclusive development has been inequality. The report highlights that although the country has bettered HDI value of 0.64 in this year as against 0.636 in 2017, uplifting millions out of poverty hence categorized as a ‘medium human development’, glaring inequalities remains. When adjusted for inequality, the HDI value declines by more than a fourth.   In India’s case, the Inequality-adjusted HDI (IHDI) falls to 0.468, a 26.8% decrease, and far worse than the global average.  This can be attributed to the stark inequalities in the country with regards to access people have to education, health and more importantly income.

“India loses a quarter of its human development value due to its persistent inequality,” stated Francine Pickup, UNDP country head, commenting on the country’s HDI ranking of 130 out of 189 countries. How unequal is India anyway? India presents a perpetual paradox where millions go to bed hungry while the country has the third highest number of billionaires in the world.  While variables in inequality varies as income, gender, health and literacy et al, a close look at the number of Indians who made to the list of world’s richest people discloses the iniquitous inequality that taints India’s growth story.  

As per the Hurun Rich List 2018 that ranked 2,694 billionaires from 68 countries and 2,157 companies, India added 31 billionaires in the past year. The total number of Indians on that list is now 131. As per an AfrAsia Bank report, India currently has 119 billionaires, the third highest after the US and China, and this number is expected to swell to 357 by 2027. Forbes, the business magazine that produces an annual list of the richest people worldwide every year, this year has taken into account 2,208 billionaires from all over the world to come out with its list. There are 121 Indian billionaires, 19 more than last year, who made to the Forbes’ list.

Against this glossy section, approximately 19 crore Indians every night go to sleep on an empty stomach and starvation death escalates in the country.   Death by hunger is India’s tragic reality.   It is a fact that 3,000 children die of malnutrition in the country every day. Stunting due to hunger also holds back the prospects of an entire generation. More children under the age of five die in India than anywhere else in the world. A recent estimate puts this figure at over 1.5 million children a year — over 4,500 child deaths a day. A third of these could have been averted if children did not go to bed hungry night after night.

Although the number of extreme poor in India is rapidly reducing, India is home to about 11.1 percent of the extreme poor in the world. As of today, as mentioned in the 'Future Development' blog, India is home to the second largest population of extreme poor in the world, behind only Nigeria and just ahead of the Democratic Republic of Congo.

Gender disparity is another equally worrisome factor that renders India with a skewed HDI. Commenting on the cruel reality that India loses a quarter of its human development value due to inequality, Francine Pickup had this to say: "For a country that has made such remarkable progress, pockets of deprivation continue to prevent millions of people from fulfilling their true potential. Women especially continue to have a lower HDI than men, primarily because of fewer opportunities in education and at work. Despite overall progress, women continue to be deprived of healthy life, knowledge and a decent standard of living.”

Despite overall progress, women continue to be deprived of a healthy life, knowledge and a decent standard of living. India ranks 127 out of 160 countries on the Gender Inequality Index which reflects gender-based inequalities in reproductive health, empowerment (political and educational), and economic activity. Women especially continue to have a lower HDI than men, primarily because of fewer opportunities in education and at work.   India’s worst performance on the gender scale is with regards to its female participation in the labour market which is 27.2% compared with 78.8% for men even as globally 49% women are part of the labour force as compared to 75% men.

A jump of one notch up in the HDI ranking while inequality stares in the face brings little cheer to India. The persistent inequality in India is dangerous it slows down poverty-reduction and undermines the sustainability of economic growth. The Government ought to reduce inequality by rejecting market fundamentalism, opposing the special interests of powerful elites, and changing the rules and systems that tilt India’s HDI.   It needs to implement reforms that redistribute money and power and level the playing field.

India can straighten its skewed HDI only by reducing inequality. For this, policies should be universal in principle and the country has to face an uphill battle against forms of growth that are discriminatory against its own women, ethnic minorities and the marginalized section in general.

(Published on 24th September 2018, Volume XXX, Issue 39)