The database and methodology for computing the human development index (HDI) by the United Nations Development Programme (UNDP) are not as robust as that of the national income or price indices that get monitored on a quarterly or annual basis. The construction of HDI involves four indicators with three dimensions — per capita income, health (life expectancy) and education (average and expected years of schooling). The exercise involves making these parameters scale-free, using global goal posts that are held constant, to permit temporal and inter-country comparisons. Notwithstanding the conceptual issues of computing growth based on composite indices, HDI has been used with considerable interest and confidence in mapping humanistic global development scenarios, and also as an input in national planning.

There is bad news at the global level coming from the report released by the UNDP last week. The annual rate of progress in HDI, which had gone up from 0.7 per cent in the Nineties to 0.8 per cent in the following decade, has now declined to half that level during 2010-21. Higher achievements were recorded by medium and low HDI countries whose corresponding percentage growth had gone up from 1.1 to 1.6 but has now declined to 0.8. The worst affected are Latin America and Caribbean regions whose growth has slumped to 0.3 per cent during 2010-21. India has performed comparatively well, with its growth accelerating from 1.2 per cent to 1.6 per cent, but it came down to 0.9 per cent in 2010-21.

The bad news for India is that its global HDI rank has slipped from 129 in 2019 to 131 in 2020 and to 132 in 2021-22. In comparison, the country’s ranking in income is six notches higher than that in HDI. It is a matter of some concern that the country’s performance is sluggish in comparison to that of the developing countries as a whole in the last decade. Furthermore, in all three dimensions, the values in 2021-22 are less than those in 2019 while for the countries in the very-high, high, medium and low HDI countries, the decrease is noted only in the health index. The overall HDI for all the above-mentioned categories is slightly higher in 2021-22 compared to 2019, which unfortunately is not the case for India.

India’s per capita income in terms of purchasing power parity has gone down by 5 per cent compared to a 2 per cent increase for the developing countries during 2019 and 2021-22. This is in conformity with the national data, as the country had recorded a sharp fall of 7 per cent in real terms in GDP in 2020 and could not fully recover the following year. The decline in life expectancy is sharper for India than for developing countries. The life expectancy criterion is, of course, influenced much by what happened during the Covid pandemic. The HDI figure, being based on UNDESA (2022) data, is likely to be influenced by the very high reporting of Covid deaths in India by the WHO in 2020. The sharp fall in the expected years of schooling, drawn from estimates and modelling of research studies, is also likely to be questioned by government sources – their argument would be based on the various initiatives launched during the Covid period.

The slight decline in development indicators may not be taken as a matter of serious concern and can be attributed to the methods of scaling and composition that result in serious loss of information and subjectivity. One must probe into the data used by UNDP from different sources given the fact that the last three years have been disastrous for the statistical systems of developing countries. Whether the data were obtained from the national governments or estimated by using a global model, one may not be alarmed about the relative deficits until the robustness of the data employed is confirmed. This underlines the urgency of conducting the population Census and regular national surveys in India.

A genuine reason for concern for India, however, is the high inequality in different dimensions of development. UNDP brings out inequality-adjusted HDI figures which reduces the value based on inequality within the country. By this measure, India sinks from the 132nd to 134th position as its inequality is higher than the average figures for the countries.

An analysis of inequality across different dimensions of development for very high, high, medium and low categories of development in 2021-22 reveals an interesting pattern. The loss in overall HDI due to inequality in the topmost category is 10 per cent which only goes up to 17, 24 and 31 per cent respectively as we go down in terms of development categories. More importantly, inequality in health and education in the topmost category is less than 10 per cent, which is half that of income inequality. These increase systematically as we go down the development categories, the figures being 29 per cent and 39 per cent for the low HDI countries. Income inequality in low HDI countries is about the same as that in very high countries while the health and educational inequalities are more than six times.

India, belonging to the medium HDI category, shows dimensional inequalities similar to or slightly below the average figures in the category, except in the case of education where it is high and closer to the low HDI countries. The inequalities in health and education are more than twice that of the very high and high HDI categories. Happily, there has been a decline in health inequality from 31 per cent to 17 per cent during 2010-21. This is higher than the decline in the low and medium HDI categories. Furthermore, there has been little decline in educational inequality in low and medium-HDI countries. Unfortunately, this is the case in India as well. Access to quality education must, therefore, be critical for determining the focus of the country’s development strategy as it moves towards a $10 trillion economy.

Kundu is Senior Fellow at the World Resources Institute and Khan is Assistant Professor at the Institute for Dalit Studies

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