1.7.1. Human Development Index

Once it is realised that even though the level of income is important, yet it is an inadequate measure of the level of development, we begin to think of other criteria. There could be a long list of such criteria but then it would not be so useful. What we need is a small number of the most important things.

The Human Development Index (HDI) is introduced as a measure of human development that goes beyond just economic indicators like income. While income offers some insight into prosperity, it does not entirely capture the quality of life experienced by individuals. Therefore, the HDI aims to provide a more comprehensive view by focusing on essential aspects of human life, mainly health and education, alongside income.

Think of it like trying to measure how well a school is doing simply by looking at test scores. While good grades are important, they don’t account for factors such as the mental wellbeing of students, the quality of teaching, or access to learning resources. Similarly, HDI integrates various aspects of life to give a clearer picture of a country’s development.

Health and education indicators, such as the ones we used in comparison of Kerala and Haryana, are among them. Over the past decade or so, health and education indicators have come to be widely used along with income as a measure of development.

HDI includes three critical components: life expectancy at birth (a health indicator), education (measured by mean years of schooling and expected years of schooling), and per capita income (representing the standard of living). These indicators collectively depict a more holistic view of human development, capturing not only economic prosperity but also the well-being and knowledge of individuals.

Imagine planning a party. You might consider the food (representing income), but you also think about entertainment and seating arrangements (representing health and education). A great party requires all these elements, just like a country's development needs various aspects to be flourishing.

Table 1.6 lists relevant data regarding India and its neighbours from Human Development Report 2021.

The HDI allows for comparisons across different countries by providing a ranking based on the integrated measures of health, education, and income. For instance, it shows that a country like Sri Lanka, despite having a lower income than India, may rank higher in HDI due to better health outcomes and educational attainment. This promotes the understanding that economic wealth alone doesn’t equate to quality of life.

Think of it like reviewing athletes’ performance. Some athletes might have impressive stats in terms of speed (income), but if others have better stamina and skills (health and education), they result in better overall performance. Thus, while income matters, it’s crucial to consider how individuals live and learn.

Many improvements have been suggested in calculating HDI and many new components have been added to the Human Development Report but, by pre-fixing Human to Development, it has made it very clear that what is important in development is what is happening to citizens of a country.

Sustainability is a newer, crucial aspect of development that emphasizes the importance of developing systems that not only improve current living standards but also do not compromise the needs of future generations. The direction of HDI indicates that development should prioritize long-term human welfare rather than just short-term achievements.

Consider a garden you’re cultivating. If you only focus on growing plants quickly without caring for the soil or water supply, your garden may thrive now but will deteriorate over time. Similarly, sustainable development ensures we meet current needs while maintaining resources for future use.

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