Prof.(Dr.) D. Mukhopadhyay
It has been a persistent endeavour of human civilization to elevate its socioeconomic status from being the caveman to 21st Century citizen whose day to day life and economic activities are leveraged by digital technology. In simplicity, bringing about rise in standard of living in terms of enjoying quality life is the ultimate objective of any society in 21st Century. Human development is assumed to be the ultimate objective of economic activities pursued by a nation . Human development seems to to be in place when it ensures long life expectancy, better health, sanitation and hygiene, quality education and right to live with dignity. It can be a valid hypothesis that economic growth and human development are positively correlated as economic growth sounds to be an important contributor to human development provided National Income in terms of Gross Domestic Product (GDP) distribution is free from being skewed and contrarily it is to a significant extent on the egalitarian line reflected in the Lorenz Curve which is hardly a reality as far as India is concerned. It is a span of seventy five years since she got her ‘Dominion Status’ from the colonized rule of two hundred years. This is indeed a sad theme in the context of National Income and Wealth Distribution issues and it is transparently evidenced in the latest World Inequality Report , a joint intellectually seminal contribution of the World Inequality Lab, Lucas Chancel and Economists such as Thomas Piketty, Emmanuel Saez and Gabriel Zucman. This Literature is an embodiment of reflection of inequality of income and wealth distribution across the globe . To be specific, as far as income distribution is concerned, the richest 10 percent of the world population is reported to have been enjoying 52 percent of the global income and just 8.5 percent of the global income belongs to the poorest half of the population. It is really a shocking finding of the researchers to report the skewed degree of inequality in income and wealth distribution. The same report exhibits a dismal picture of economic performance of India. It reported a gloomy portray of inequality in income and wealth distribution in India and it appears to be a serious issue demanding attention of the policy formulators and decision makers on priority basis. The findings categorically reported that ‘India stands out as a poor and very unequal country, with an affluent elite’. Specifically speaking, top 1% and top 10 percent enjoy 22 percent and 57 percent of GDP respectively and just 13 percent of National Income goes to the bottom 50 percent of the population. The Report presented a glaring and frustrating show of gender and carbon inequality. It is pertinent to mention that just 18 percent being the lowest income of the world is shared by the Indian female workforce and the same is on an average 15 percent and 21 percent in the Middle-East and Asia excluding China occupying 85th Rank in the HDI Rank List respectively. It is interesting to note that one person belonging to the bottom 50 percent of the Indian population is responsible, on an average, five times lower carbon emission than that of the bottom 50 percent in the European Union and 10 times lower than the bottom 50 percent of the USA. It may be critically observed that the global bottom 50 percent per- capita income is seen to be attributed with much higher rising trend if India is excluded from the list of the countries across 189 countries while computing global bottom 50 percent Per-Capita income which is an indicator of an erratic picture of inequality of income distribution in India. India tried to adopt the model of fast economic growth for arresting poverty and addressing the issues relating to unequal income distribution through economic empowerment by providing many income generating schemes such as MGNREGA Project, subsidized or even free ration to the ‘below poverty line’ ie about 30 percent of the bottom 50 percent of population by and large.
On the contrary, India could neither overcome nor sustain the 2008-2009 Global Financial Crisis . Further growth in GDP alone has been proved to become summarily ineffective in many countries across . ‘The Bottom at the Pyramid’ is hardly given access to quality education , better healthcare services and sanitation and hygiene based habitation. Moreover, the policy makers may not have access to real data too. It has been a feature of administering a Nation-wide Census every decade which was due in 2021 but could not be undertaken due to the on-going pandemic situation . To formulate appropriate economic developmental strategy and make macro level decisions and micro level implementation, availability of real and reliable data is sine-qua non. This is one side of the coin on uneven economic development leading to poor Human development of the country. Government has a pivotal role in reducing gap in income and wealth distribution . In order to counter inequality, it is an imperative to adopt a progressive resource generation and allocation model which is to take care of public expenditure as this is a tool for improving Human Development Index (HDI). In the context of human development, the researchers prescribed ‘Three Ratios ‘ such as ‘the Public Expenditure Ratio’ ie Public Expenditure at Different Sectors as the Proportion of Gross National Product (GNP) and not GDP. Secondly , HD -Allocation Ratio which stands for Resource Allocation for HD Sectors as the Proportion of the GNP and finally, the HD Priority Ratio which represents Public Expenditure for the Priority Sector as the Proportion of GNP. Some expenditures such as expenditure on basic and secondary level education within the HD Sectors is much more leveraging in terms of achieving progression of Human Development Index compared to other the expenditure on tertiary level education. In the context of determining priority sectors or priority areas, the peculiarities and individual stage of development of the country needs to be taken into cognizance as the researchers are observed to be critical in allowing a blanket group of expenditures to be considered as the priority areas it normally varies from country to country. Further, the researchers also cautioned that the degree of inherent variations across countries exist in ratios mentioned above implying that the same level of GNP may be found to be remaining associated with different levels of Public Expenditure on Human Development priorities. Public Expenditure on Education Sector being the priority sector can be an enabler of technological advancement both in innovation and use of technology and hence becomes the contributor to economic growth sequel of which is Human Development.
Technologically social transformation is possible when workforce , business promoters and entrepreneurs are exposed to to skills and techno-managerial capability enhanced by professional education and training particularly in the . fields of Engineering and Technology, Accountancy and Management . Besides education and skill enhancement initiatives, quantity and quality as well as domestic and foreign investment in conjunction with Government Policies also influence economic growth and development trajectory. Further, Human Development of a nation invariably depends on health, hygiene and sanitation and education and cumulative effect of these variables is the determinant of productivity of workforce of a country. The prominent degree of low human development is primarily due to poor performance of the country almost at all levels and insignificant access to education, health and basic infrastructure across regions and Indian states and this is universally accepted that any nation has to take care of of these issues on priority basis for achieving sustainable development. Regional economic imbalance in terms of intra-regional inequality is an eye-catching phenomenon in India. The causality between economic growth and human development can prominently be observed in investment rate and income distribution, effectiveness of governance and institutional efficiency. The growing focus on low Human Development Index stems, to a greater extent , to unevenly distributed income and wealth and significant presence of regional inequalities across and between states in the Indian states. The poor Human Development Index as reflected in the research reports is due to staggering inequalities in income and wealth among the Indians. The spatial inequalities at micro level has been reflected in many researches in all its form and dimensions that act as bottleneck in achieving targeted sustainable development rate. Majority of the population is yet to have access to the quality health services, hygienic environment , education and comfortable transportation and other infrastructural assistance. The HDI is an objective measure for assessing long-term progress in three basic variables, such as life expectancy, education and standard of living , occupying a dominant position in human development of a nation.
The UNDP published its first Human Development Report in 1990 based on the seminal work of Dr Amartya Sen and Dr. Mahbub-Ul-Haq and its focus was on hypothesis- ‘Human development is a process of enlarging people’s choices’, (HDRO, 1990). Therefore, India needs to focus essentially on long term projects for employment and income generation and evenly allocate national income to the various sectors based on priority which could perhaps be a solution to boost the HDI. Projects on infrastructure, increasing percentage of resource allocation to education and healthcare services should be the priorities for public expenditure. Further, political populism theory for distribution of goods and services free of cost should not be used at all by any government and instead economic empowerment through creating and proving employment to people in order to generate sustainable level of income and peoples’ capability for buying ‘the necessaries’ with that income is a long term solution to a earn a healthy HDI across countries.
(The author is an Independent Researcher and a Practising Advocate, Calcutta High Court)
Trending Now
E-Paper
Follow our WhatsApp channel