Back UN Human Development Report 2005: Shocking disparities across regions
S. Venkitaramanan
From the start of the human development index, which has been around for 10 years, various countries have been doing their best to climb higher up the ladder. It must be granted that experts are divided about the validity of the Human Development Index as it is worked out.
There is considerable technical argument about the legitimacy of the exercise of computation of a composite index for human development combining the income level, health indicator and access to education. The weights assigned are equal — one-third each. The methodology of calculating the HDI is fairly straightforward, the distance of each country from the minimum level reached in respect of the indicator is compared with the overall distance between the maximum and minimum of each dimension of the world as a whole.
Thus, the richest country will score a measure of one on the income index since its distance from the minimum will be equal to the overall difference between the peak and the lowest. Similar calculations are made for other indicators. The calculations have been based on the latest data as available up to 2003.
Some general remarks are in order. The Tables in the HDR show that Norway occupies the top place in the world with a human development measure of 0.963. Canada comes fifth with a measure of 0.949. The US is tenth in the list with 0.945. Singapore is deservedly high on the list, at 25th rank. What is more interesting than the latest level of human development indicator is that there has been a sharp increase in the human development index in some cases and reversals in some others.
Fastest climbers
The report notes that Bangladesh and China have been two of the fastest climbers in the HDI rank. Bangladesh has risen 14 places since 1990, while China has risen 20.
HDI reversals have also been particularly noteworthy, especially in the former Soviet Union countries and Africa. The former reversal is a reflection of the impact of sudden transition from Communism to market-based policies, with consequent neglect of the State's role in matters relating to health, education and nutrition. A high price to pay for transition!
The reversal in Africa is primarily the result of the advance of HIV/AIDS in itself — a consequence of poor health facilities. India has to take care lest it also fall into the same AIDS trap.
The latest UN-HDR has particularly provoked a controversy, or shall I say a healthy debate, on how our less-affluent neighbour to the east, Bangladesh, has fared much better than we in respect of rise in HDI. Experts have been quick to point out that this is due in part to the rich legacy of the Bangladesh liberation struggle, which led to a measure of civil society organisations.
Further, credit has to be given to the Grameen Bank movement and self-help groups, which were part of this movement. In addition, the country's economic policy, which has focused on job-led growth, such as the relatively higher emphasis on development of industries such as the garments industry, which are female-centred and widely dispersed, may also have contributed to a state of higher emphasis on welfare indicators, including children's health and nutrition.
Equally striking in the global HDI league table is the high rank of Vietnam in the HDI league. That Vietnam has progressed so far is a testimony to its socialist model of economy, which has blended market-based policies with adequate emphasis on welfare of the people.
India's mixed record
India has been a successful globaliser, but with a mixed record in human development, while Bangladesh has been less striking in income-growth, but rich in HDI. The report is fair in pointing out that India has many constituent States, which are laggards in human development and may perhaps explain the lower rank of the country.
It is legitimate, however, to note that these differences operate in different countries in different ways and cannot fully explain away the low rank in HDI. They only serve to emphasise the need to address regional disparities and tackle the laggards in India and similar other countries as a matter of high national priority. Economic policy-makers have a challenge here.
The previous Human Development Report had been a pace-setter for a race of nations to the top slot in the HDI. They had incentivised policy-makers of different countries to balance their emphasis on social development, such as health, education and social welfare, as well as on income growth. These reports had also energised a number of parallel initiatives at country level of HDRs for different countries which had, in turn, created a platform for various regions and States to compete with each other on human development.
This must, indeed, be an unintended, but extremely satisfactory, outcome of the whole exercise. It has rightly refocused attention of policy-makers away from the overarching emphasis on income growth to the neglect of social welfare.
Decade of lost opportunity
In addition to laying out the rankings of different countries in human development, the latest HDR performs a useful role in emphasising the need for the world as a whole to focus on the attainment of Millennium Development Goals approved ten years ago.
It rightly points out that, viewed from the perspective of 2015, for which the Millennium Development Goals are set, there is an ever-growing danger that the next ten years will go down in history not as a decade of accelerated human development but of lost opportunity, half-hearted endeavour and failed international cooperation.
The choice before the world, it states, is that: "It can either continue on its current development path or change direction and put in place the policies intended to turn the promise of the Millennium Development Goals into practical outcomes. A much-needed warning!
The HDR 2005 has rightly stressed the need for the developed world to refocus its attention on changes in aid, trade and allied policies. That the promised aid is not being delivered to the poorer countries is a bad augury. Promises alone do not matter unless they translated into actual aid.
Poor sustaining the rich
What is more distressing — though not specifically stated in the HDR — is that while such countries are not giving their agreed share of aid, the poorer countries are sustaining the richer countries in their present growth path with a robust reverse flow of capital from countries, such as China, India, Russia and other economies which, ironically enough, comprise the bulk of the world's deprived and poor.
Very impressive are the HDR's telling statistics regarding the priority given by policy-makers in developed countries to military expenditure in preference to aid.
While the Governments of the West are crying hoarse over their inability, for fiscal reasons, to provide more aid, even aid as promised, they are merrily increasing their outlays on military expenditure.
The HDR 2005 points out that for every dollar invested in development assistance, another 10 dollars are spent on the military budget. No G-7 country has a ratio of military expenditure to aid of less than 4:1.
That ratio rises to 13:1 for United Kingdom and 25:1 for United States — deplorable figures, hardly in keeping with preferred initiative to step up human development with aid.
`Absurd ratio'
In a world in which rich countries recognise that priority thrusts are linked to global poverty, inequality and insufficient hope for large segments of the population, such an absurd ratio as 10:1 of military spending to aid makes no sense, says the report.
Brave words, but will Bush-Blair and Co. listen to the exhortations of UN's Human Development Report?
All in all, the latest HDR is a fitting successor to what Mahbub Haq, the well-known development economist from our part of the world, inspired by our own Amartya Kumar Sen's farsighted suggestions regarding development as freedom, initiated a decade ago in the United Nations.
As is to be expected, the latest HDR provokes thought and will help induce healthy competition between nations and regions in the right spirit to achieve higher levels of human development.
Above all, it stresses the need for the world as a whole to recognise the challenges of development, especially the need for aid and liberalised trade, and not to let precious opportunities be lost.
The obscene levels of inequality between regions and within regions is an argument for a determined global effort to accelerate human development.
The HDR 2005 gives food for thought and considered reflection among those policy-makers who are gathered at the UN Summit to deal with global poverty amidst plenty and deprivation amidst affluence.
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