India, as one of the world’s largest economies, has experienced robust economic growth, with an average rate of 6-7% post-liberalization. However, this growth has not translated into significant improvements in human development indicators, with a 2021 HDI score of 0.633.
This disconnect between economic growth and human development is a critical issue that requires a multifaceted analysis and a comprehensive approach to bridge the gap.
Reasons for Disparity between Economic and Human Development in India:
Skewed Economic Growth:
A substantial portion of India’s economic growth stems from the service sector, particularly IT and finance, which employs a minority of the population, leading to jobless growth.
Data: Over 60% of GDP is contributed by the service sector, while less than 30% of the workforce is employed here. In contrast, agriculture employs around 45% but contributes only 15% to GDP.
The high unemployment rate is another indicator, estimated at around 7.95% in 2023 by CMEI.
India’s historically low public health expenditure results in insufficient healthcare infrastructure and accessibility.
Data: India’s health expenditure stands at approximately 2.1% of GDP in 2023, far below the global average of around 10%.
Education System and Quality:
Despite progress in literacy rates, the quality of education, especially in rural areas, remains subpar.
Data: According to ASER 2022, over 50% of Class V students in rural India couldn’t read a Class II text.
Economic growth hasn’t been evenly distributed across the country, leading to certain states surging ahead while others lag.
Data: States like Maharashtra and Tamil Nadu have GDP per capita significantly higher than the national average, while states like Bihar and Uttar Pradesh face economic disparities.
Rapid population growth strains resources, diluting the impact of economic growth on individual well-being.
Data: In 2023, India has become the most populous country in the world.
Economic growth benefits have not been equitably distributed, resulting in growing economic disparities.
Data: An Oxfam report in 2020 revealed that the richest 10% of Indians hold 74.3% of the total national wealth, while the bottom 50% hold only 2.5%.
Infrastructure and Sanitation:
Despite economic growth, challenges like sanitation and access to clean drinking water persist for a significant portion of the population.
Data: The 2022 report indicates that 17% of the rural population in India still practices open defecation, despite the Swachh Bharat Mission’s efforts.
A Multifaceted Approach to Addressing the Disparity:
Increase Public Spending on Health and Education:
Health: Raise public health expenditure to at least 2.5% of GDP, as recommended by the National Health Policy 2017, to improve healthcare infrastructure and accessibility.
Education: Allocate more funds to modernize educational infrastructure, particularly in rural and backward regions, and invest in teacher training programs to enhance the quality of education.
Focus on Inclusive Growth:
Implement policies that promote equitable distribution of resources and opportunities, ensuring marginalized sections of society benefit from economic growth.
Develop labor-intensive sectors like textiles to generate employment.
Strengthen Social Safety Nets:
Expand and enhance the efficiency of social welfare schemes such as the Public Distribution System (PDS), Mid-Day Meal Scheme, and MGNREGA to ensure food security, nutrition, and employment opportunities.
Address Regional Disparities:
Create a targeted policy framework for socio-economically lagging states and regions, focusing on infrastructure development, skill training, and job creation.
Enhance Skill Development and Vocational Training:
Expand and enhance initiatives like the Skill India campaign to equip the workforce with relevant skills needed for the changing economic landscape.
Improve Agricultural Productivity and Infrastructure:
Given the significant dependence on agriculture, modernize the sector with technological interventions, better irrigation systems, and post-harvest management.
India’s commendable economic development post-liberalization has not translated into corresponding improvements in human development due to systemic and structural challenges.
To bridge this disparity, a holistic and inclusive approach prioritizing health, education, infrastructure, and equitable distribution is essential, embracing the capability approach of Amartya Sen and justice ideas of Rauls. These efforts will be crucial for India’s journey towards a more equitable and human-centric development path.