EurekaWow | Indian Economic Development
India in Comparative Perspective
-Amartya Sen and Jean Dreze (An Uncertain Glory)
Majority of the Indian people have been left behind in the enhancement of living standards.
Comparing India with ROW, we nced to be careful about the scction of the population which is being
compared.
Comparisons are often made to for the purpose of checking where India fits in the international
lcague. More than often, the system of Rank is uscd (Highest Best). However this system has its
own drawbacks for it greatly depends on the variable chosen for ranking as is evident in the fact that
India ranks high in GDP growth figures in spite of its mediocre performance as far as the quality of
life is concerncd.
Further analysis has been done by comparing Indian averages with that of other countrics. Sources of
most of the figures are the World Development Indicators.
Comparisons with the Non-African Poor
Most of the countrics with a low Human Development Index (HD) are in South Asia or sub-Saharan
Africa. They share the incidencc of poverty, however living conditions, now are much better in sub
Saharan Africa.
Per capita income is higher by 50 per cent higher in India, however for social indicators like female
literacy, and child nutrition, India is eithcr at par or worse than sub-Saharan Africa. Both regions
continue to share a scvere problem of massilliteracy, especially among women.
Indicators India's Rank among 16 poorest countries
GDP per capita
Life Expcctancy at birth
Infant & Child Mortality Rate 10
Total Fertility Rate 7
Proportion of Underweight children 15
Literacy Rate, age 15-24 yrs
Females
Males
Inferences:
1. According to the World Bank, only 15 countries outside sub-Saharan Africa had a GNP per
capita lower than India's in 201 1: Afghanistan, Nepal, Bhutan, Pakistan, Bangladesh, Burma,
Uzbekistan, Victnam, Yemen, Papua New Guinca, Tajikistan, Kyrgyzstan, Laos, Moldova,
Cambodia and Haiti.
2. In thc table given above, we compare India in non-income parameters. India has, by choice
the highest GDP per capita, ranking Iin it. Its rank is 10" or worse in the other parameters,
clearly reflecting the living standards prevalent in India.
3. Looking country wise, we see that Victnam performs better than India in terms of all the
indicators in spite of being much poorer. Uzbekistan has almost 100 % literacy rates.
4. A striking contrast between India and Nepal can be scen with Nepal almost at par with India
with just I/3 of the income levels.
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EurekaWow | Indian Economic Development
India's Decline in South Asia
India's Rank among 6 South Asian countries
Indicators 1990 2011
GDP per capita 4 3
Life Expectancy at birth 4
Infant & Child Mortality Rate 2 5
Total Fertility Rate 2 4
Proportion of Underweight 4-5 6
children
Literacy Rate, age 15-24 yrs 2-3 4
(Females)
Inferences:
1. The 6 countries taken are- Pakistan, Sri Lanka, Bangladesh, Nepal, Bhutan and India.
2. Bangladesh- India's per capital income was alrcady more than 60% that of Bangladesh,
however Bangladesh has overtaken India in terms of social indicators like life cxpectancy (4
years higher in Bangladesh in 2010), child survival and enhanced immunization.
3. Nepal- In spite of 1/3" of India's income and poor governance, Nepal is almost at par with
India in terms of various social indicators.
4. Pakistan- Between 1990 and 2011, real per capita income has increascd by 50 and 170 per
cent in Pakistan and India respcetivcly, however the gap in social indicators hasn't changcd
much.
5. Sri Lanka- Huge lead over India in terms of social indicators cspecially in terms of literacy
levels. Something to note, Sri Lanka achicved this with private schools being virtually absent
in Sri Lanka. Few pcople live more than 1.4 km away from the ncarest health centre.
6. Comparing in terms of rank, overall., only onc country in South Asia (Sri Lanka) clearly had
better social indicators than India in 1990, but now India looks sccond worst, ahead only of
Pakistan.
Case Study Bangladesh's Progress and Role of Women
Bangladesh is one of the poorest countries of the world. Yet Bangladesh has made rapid progress in
crucial aspccts of standard of living. However, Bangladcsh cannot be considered as a 'model for
development' as in spite of the recent development, it still remains one of the most-deprivation ridden
countries in the world. With 1/1 " of the GDP of India and a mere 10 per cent expenditure on public
services (with lack of accountability), Bangladesh has quite restraincd public services. Democratic
institutions do not function perfcctly, maintaining the tradition of the opposition not attending the
Parliament. Yct there are features of astonishing achievements, one can sce there.
There can be seen a pattern of sustaincd positive change in gender relations. Gender related indicators
are better in Bangladesh than in India. Greater literacy among women has led to more participation in
the work force, playing an important role in demographic transition (low mortality and fertility rates).
Bangladesh is one of the few countries where the number of girls excecds the number of boys in
school. Women's share of seats in national parliament is 20 in Bangladesh and 11 in India. In fact,
some of the country's recent achicvements build in a fairly direct and transparent way on women's
agency. Very large numbers of Bangladeshi women have been mobilized as front-1ine health workers.
4th Semester | B.A. Economics (H)
EurekaWow | Indian Economic Development
India continues to have a stagnant women participation in workforce and gender-bias in childcare,
which includes sex-abortion - only 914 girls per 1000 males (among children) in India. Bangladesh's
focus on health and cducation has been helped by NGO activitics, In spite of low public expenditure,
Bangladesh's health indicators are better than India as shown in the following table
Indicators of Public Health (AII Proportions) India Bangladesh
Households practising open defecation 55 8.4
Fullyimmunizcd children (12-23 months) 44 82
Population with sustainable access to improved 88 97
water source
Diarrhoca affected children treated with 'oral
39 81
rehydration therapy'
Children who startcd brcastfecding within 24 55 89
hours of birth
Bangladesh has also followed effective and non-cocrcive family planning (Total fertility rate falling
from 7 in carly 70s to 2.2 in 2011). Surveys show the high awareness about family planning and
higher use of modern contraceptive methods than in India. Another point to be noted is the importance
of social norms in health, cducation and related fields in bringing about changes in social and
community mobilization in bringing about the same. Many grass root hcalth and community workers
have been mobilized to explain contraception methods,improvcd sanitation, organizing nutrition
supplement programmes, counsclling pregnant women ctc in various villages. India can indecd learn a
lot from its neighbouring country.
India anmong the BRICS
nferences:
1 Common features in the BRICs countries (Brazil, Russia, India and China) include their
gigantic populations.
2. India appears to be an cxception. Other countries have achieve universal or near universal
literacy in younger age groups, universal child immunization and the problem of child
undernourishment has almost disappeared BRICs nations except India. GLISE
3. India's per capita GDP is less than 1/2 of China, I/3 of Brazil and 1/4 of Russia. However,
the required catching-up' has to be both in terms of income and social indicators (public
services, social support and economic distribution). India, out of the 4, remains the only
country which hasn't gonc through the cxpansion of public services.
4 China- made progress towards universal access to clementary cducation, health care and
social sccurity before its market oricnted reforms in 1979 (China's growth oriented policies
were helped by human development laid carlier). The principle of universal health coverage
has reappcarcd in China's health planning after a break in the 1980s and 90s. Nearly 95 per
cent of the people are covercd by the revamped public health system.
5. Russia-Before the breakup of the Soviet Union in 1991, the country had a well developcd
welfare state. However, there was a strain in social spending after the cconomic reforms in
1990s. The breakdown was compounded by an cconomic catastrophc, not unrelatcd to the
lethal advice of Western experts who prcdicted an 'cconomic miracle' in a newly market
oriented Russia even as the cconomy kept on sinking. This prolonged crisis, before the revival
in carly 2000s led to a catastrophic deterioration of the social infrastructure. In the recent
ycars, there have been major efforts to rebuild public services.
4th Semester | B.A. Economics (H)
EurekaWow | Indian Economic Development
6. Brazil- Progressive social policies are recent in nature, which followed after rapid cconomic
growth. For a long time, Brazil combincd rapid cconomic growth with repressive government,
massive incquality and cndemic deprivation. However, the picture has radically changed
during the last twenty years.
Indicators India China Brazil Russia
GDP per capita 3203 7418 10279 14821
(2011,at 2005 PPP)
Life Expcctancy(Males) 64 72 70 63
Under 5 Mortality Rate 61 15 16 12
Literacy Rate (Females),in % 74 99 99 100
Proportion of children who're 43 4 2 N/A
Underwcight
Public Expenditure on Health as 1.2 2.7 4.2 3.2
a % of GDP
Public Expenditure on
3.3 NA 5.6 4.1
Education as a % of GDP
Case Study: Old and New Brazil
In the 1960s and 1970s, Brazil had one of the fastest growing cconomies, but living conditions
remaincd deplorably low for large scctions of the cconomy. Over the last few decades, Brazil has
substantially changed course and adoptcd a more inclusive approach bascd on active social policies. It
has thus come out of 'unaimed opulence' (ndiscriminate pursuit of cconomicexpansion, without
paying attention to how it is shared or how it affecs people's lives).Social Spending in Brazil (25% of
GDP) is now about four times that of India (6%).
This change has becen driven by democracy. Notable aspects of this new orientation include:
Health:
Right to health included in new democratic constitution as a matter of justifiable right (unlike
India where it features in the Directive Principles).
Brazil created the Unificd Hcalth System for providing free and unbiased healthcare. It also
launched 'Family Health Programme' which involves both private and public health care
providers, but is publicly funded.
IMPACT- According to WHO, 75 per cent of Brazilians rely cxclusively on Family Health
Programme. Also its health indicators have improved over time, for instance, only 2 per cent
children below five are underweight.
Brazil's new health care project is rooted in strong popular movements. Unificd Health
System was conceived by health activists and is called 'health sector reforms". Health is a
lively political issue in Brazil, unlike India where hcalth care has received much less heed.
Income Redistribution and Social Security:
> In a study by Martin Ravallion(2011), it is shown that between 1993 and 2005, Brazil's per
capita grew at just 1 per cent (as compared to India rate of 5 %) yet the rate of poverty
reduction was much larger.
Various rcdistribution initiatives include - social assistance programmes like pension
schemes, minimum wage policies and from 2003 onwards, Bolsa Familia of targeted cash
transfers. These programmes had little cffect on incquality, however had a significant impact
on extreme poverty.
4h Semester | B.A. Economics (H)
EurekaWow | Indian Economic Development
Education:
The proportion of children attending private schools at the primary level (10 per cent) is much
smaller than in India (30 per cent).
Government schools have undergone major reforms. For example, a funding cqualization
law; has been enacted to ensure fair distribution of cducation funds, conditional cash transfers
have been used to promote school attendance and heavy investment has been made in pre
school education.
IMPACT:
(1) Increase in School Attendance in younger agc groups rcaching 98 per cent in 2009 in the
age group 6-14 years.
(2) Reduction in Education Inequality, the Gini cocfficient of years of schooling dropping
from 0.41l (1995) to 0.29 (2009).
(3) Pupil Achievements have improved as in evident in the rates of improvement in test scores
of students.
(4) By 2009, the average schooling opportunities of the lowest income quintile (poorest 20
per cent) were the same as the richest quintile 16 years carlier.
Comparisons within India
There is a regional diversity within India with sharp contrasts, The Indian states that have done well
tend to have been those which had solid foundations of participatory development and social support
carly on, and actively promotcd the cxpansion of human capabilitics.
Seven major states including Bihar, Madhya Pradesh, Rajasthan, Uttar Pradesh (BIMARU),
Chhattisgarh, Jharkhand and Odisha have had poor social indicators since long. Computation of
multi-dimensional poverty index (MPI) place states like Bihar and Jharkhand in the same category as
the poorest African countries. Thus, living conditions in the p0orer halfof India are not much better,
ifat all, than the poorer halfof Africa.
Three major states- Kerala, Tamil Nadu and Himachal Pradesh have relatively high levels of human
development. Their performance in enhancing living conditions as well as success in raising per
capita income is ofour interest. We direct our focus to them over Punjab and Haryana, which also do
fairly wellfor (A)) The former states have better levels of gender cquity and (B) the former states
LEARNONLIN
quite poor to begin with (1950s), unlike Punjab and HarvanaS
Kerala- 1Improvement of living conditions has not only continucd, but also accelerated proving it to
be sustainable, with the help of rapid cconomic growth, assisted by Kerala's focus on clementary
cducation and other basic capabilities.
Himachal Pradesh- It launched a drive towards universal clementary cducation in the carly 1970s
when it was quite poor. Within the past 40 ycars, it has come out of social backwardness and
deprivation to an advances state.
Tamil Nadu - Social relations were extremely oppressive carlier with Dalits (SCs) living in separate
colonics generally deprived of socialamenities. It was then when Tamil Nadu introduced bold social
programmes including universal mid day meals in primary schools. The Dalits had to fight for their
rights and the improvement was a result of democratic politics.
Combined population of the above mentioned states is well above 100 million. Certain common
features that have been noticed in all the 3 states are as follows:
4th Semester | B.A. Economics (H)
EurekaWow | Indian Economic Development
1. Active social policies in public cducation, health care, social security and public amenities are
scen in their experiences.
2. These states have followcd universalistic principles in provision of essential public services
like midday meals, school cducation, primary health care, ration cards, clectricity etc which
have been made available cffectively to all on a non-discriminatory basis. In certain cases, the
services have also bcen free.
3. These experiences have becen facilitated by a functioning and comparatively efficient
administration. Thcre has been little use of short cuts like Para-tcachers or conditional cash
transfers through school vouchers ctc. Traditional public Institutions have laid the foundations
of rapid progress in cach of thc three states.
4. Dealing with social incquality has becn a part of their shared expericnce. In both Kerala and
Tamil Nadu, principles of equal citizenship were forged through sustained social reform
movements and fierce struggles for equality by the underprivileged groups.
5. These improvements are not just a result of constructivestate policies but also of people's
active involvement in democratic politics. The social advances, spread of cducation and
democratic institutions enabled people to have a say in public policy.
6. All three states have achieved rapid economic growth, both on grounds of cconomic relations
and international experience. These states today have some of the highest per capita incomes
and lowest poverty rates among the Indian states. Thecse states offer an important cvidence of
complementarities betwecn cconomic growth and public support.
Thus, India has enough to learn from the success and failures of its own states and the rest of the
world.
4th Semester | B.A. Economics (H)
