Infochange India



You are here: Home | Governance | Books & Reports | Human Development Report 2003: The good news and the bad news

Human Development Report 2003: The good news and the bad news

India is severely indicted for its failure in providing healthcare, but gets a pat on the back for its efforts in decentralisation and education. A summary of the report released in July

India's position has slipped from 124 to 127 in the Human Development Report (HDR) 2003.

The report praises India for its poverty reduction effort, decentralisation and reduction in gender literacy gap. But it takes India to task for its inadequate performance in improving health, life expectancy, promoting education and tackling hunger. Though India's overall position in the human development ranking has slid, in terms of human development indices it has progressed from 0.553 to 0.590.

Quoting data from World Bank estimates, based on consumption surveys (2003), the HDR says that the proportion of people living on less than $1 a day declined in India from 42% in 1993/94 to 35% in 2001. In China the decline has been from 33% in 1990 to 16% in 2000. Meanwhile, real per capita income in India grew at a robust average rate of 4.4%, reaching $2,358 in 2001.

The report is particularly appreciative of the strides made by Madhya Pradesh, Kerala and West Bengal in the area of decentralisation. "Wherever decentralisation has worked -- as in parts of Brazil, Jordan, Mozambique and the Indian states of Kerala, Madhya Pradesh and West Bengal -- it has brought significant improvements."

There has been a significant improvement in gender literacy gaps, particularly in the poor central Indian states of Madhya Pradesh and, to some extent Rajasthan, Uttar Pradesh and Bihar. But still, India has 40 million children out of school.

Between 1992-93 and 1997-98, infant mortality rates fell in all the Indian states except Madhya Pradesh and Rajasthan. Overall, under-5 mortality was brought down to 93/1,000 in 2001 from 123/1,000 in 1990. And the infant mortality rate was brought from 80/1,000 in 1990 to 67/1,000 in 2001. Life expectancy at birth is 63.3 years in India. In China it is 70.6 years.

India's performance in the health sector, however, is a major cause for concern. The key words here are widespread under-nutrition, poor infrastructure in the health sector and high mortality rates among the poorest sections and rural schedule caste populations. Diseases like HIV/AIDS, tuberculosis and malaria continue to plague the population. More than 90% of the world's polio cases exist in India.

The report also throws light on the adverse effects of privatisation and gradual decline of government spending in the social sector including health, education and agriculture.


HDR reveals that 500 million people live in extreme poverty in South Asia. The report praises the poverty reduction initiatives of China, India, Chile, Brazil, Uganda, Thailand and Vietnam. India along with China is credited with helping the world reach its goal of halving income poverty by 2015.

But the problem of hunger in India persists, with the world's highest number of hungry people -- 233 million -- living in India.

Every day 799 million people in developing countries - about 18% of the world's population - go hungry. In South Asia one person in four goes hungry. Since the early-1970s food production in developing countries has tripled, more than keeping up with population growth. But hunger is still a major problem. The report says that if all the food produced worldwide were distributed equally, every person would be able to consume 2,760 calories a day (hunger is defined as consuming less than 1,960 calories a day).

Referring to India, the report emphasises the construction of buffer zones at local levels to release food during emergency and tackle hunger. At the same time, the report says that India, which has maintained buffer stocks of foodgrain since the 1970s to stave off widespread famine, has still not managed to show results. The report suggests that India make food affordable for poor households, whether through public distribution systems or the release of grain into the market.

Kerala has been praised for the wide coverage of its public distribution system in rural areas, which has helped attain food security for poor households in the state. Elsewhere in India, the report mentions, public food distribution works better in urban areas. Sri Lanka, another high achiever in social indicators, has covered 40% of its population through its 'food stamp scheme'.

HDR 2003 emphasises the importance of land distribution in agrarian reform and poverty. In Piaui, Brazil, farm yields increased 10-40% on non-irrigated and 30-70% on irrigated fields after land was distributed to small farmers. Equitably distributed land also reduces poverty and improves the distribution of incomes. Similarly, Indian states that implemented land reforms saw poverty fall faster between 1958 and 1992. Landlessness, claims HDR 2003, is rising in most rural regions because of higher farming densities and unequal land distribution. Average land per capita among rural farmers in developing countries declined from 3.6 hectares in 1972 to 0.26 hectares in 1992 - and stands to fall further by 2020.


A total of 115 million children in the world are out of school. Of them, 40 million are in India. Literacy in India stands at 65%. There has been a significant improvement in gender literacy gaps, particularly in the poor central Indian states of Madhya Pradesh and Rajasthan, and to some extent Uttar Pradesh and Bihar. Still, a number of areas appear to have been excluded from these trends, particularly along the Pakistan and Nepal borders.

Gaps in literacy between low social classes and the rest of the population remain extremely high, particularly in the poorest states of Rajasthan, Uttar Pradesh, Bihar and Karnataka. Referring to a study by Shariff and Sudarshan (1996) HDR mentions that female literacy rates among members of scheduled tribes were as low as 7% in Rajasthan and 9% in Madhya Pradesh.

The report expresses concern over the decline of government spending and gradual privatisation of education. Countries performing well on education devote more resources to primary education (averaging 1.7% of GDP) than do countries with average performance (1.4%).

In India spending on education has increased significantly, from 0.8% of GDP in 1950 to 3.2% today, though it still falls short of the government target of 6% of GDP. In China public spending on education is 2.3% of GDP.

Despite improvements in the 1990s, countries with the lowest primary enrolments spend more per pupil for higher education than primary education.

Citing a study conducted in 16 developing countries the report mentions that India, Indonesia and Zimbabwe have more private schools in the upper secondary school segment, but have the lowest overall upper secondary enrolments. In India, Bihar and UP have more private schools but less enrolment. This implies that privatisation of education creates more inequality in education.

Citing examples from various countries, HDR says that the direct and indirect cost of education is one of the vital causes of poor enrolment. Lowering the direct and indirect costs of schooling can reduce school dropouts and child labour.

In eight Indian states, which contain two-thirds of Indian children out of school, the uniform is one of the largest out-of-pocket education expenses. Similarly in Bhutan, Burkina Faso and Uganda, due to high household costs per pupil - ranging from 10-20% of per capita income - primary school attendance is low, while lower costs of education encourage higher enrolments in Myanmar and Vietnam.

School feeding programmes are also effective in getting children into school and keeping them there. One of the factors behind increasing enrolments in India in the second half of the 1990s was a mid-day meal programme covering all states.


The HDR paints a grim picture of health in the world. Every year more than 10 million children -- 30,000 a day -- die of preventable illnesses. More than 500,000 women a year die in pregnancy and childbirth. Tuberculosis, the leading infectious disease in adults, kills up to 2 million people a year while malaria kills 1 million a year.

Around the world 42 million people are living with HIV/AIDS, 39 million of them in developing countries. In East Asia 1.2 million people are infected with HIV while 6.0 million are infected in South Asia.

It is estimated that by 2025, India would have 110 million people affected by the HIV virus (reducing life expectancy by 13 years), followed by China with 70 million and the Russian Federation with 13 million.

India's performance in the health sector as presented in the report is not up to scratch. Though there was a significant reduction in the last decade, India's infant mortality rate is still 67/1,000 live births, and under-5 mortality is at 93/1,000 live births. With declining government expenditure in the health sector, the situation seems grave. India spends 1.3% of its GDP on health whereas China's corresponding figure is 2.1%.

In India, Kerala has made remarkable progress in the health sector. Despite a lower per capita income, and annual spending on health of just $28 a person, Kerala's health indicators are similar to those of the United States.

Due to widespread undernutrition and poor infrastructure, maternal and infant mortality rates remain high among the poor and rural schedule caste. Infant mortality rates are substantially higher in rural areas, particularly in Maharasthra and Andhra Pradesh. In India, between 1992/93 and 1997/98, infant mortality fell in all states except Madhya Pradesh and Rajasthan.

High immunisation rates are still an almost exclusive characteristic of provinces in the South and Southwest. In numerous areas, particularly in the North and Northeast, less than one-third of children were immunised in 1999.

In 1990s Bangladesh and Bhutan reduced their under-5 mortality rates by more than 6 percentage points, and Nepal by more than 5 points.

Startlingly, despite women's biological advantage, they have higher mortality rates in a number of countries, mainly in South and East Asia. And the "missing women" phenomenon mentioned in the report refers to females estimated to have died due to discrimination in access to health and nutrition. Census data indicate that missing women have increased in number but fallen as a share of women alive today. There have been improvements in Bangladesh, Pakistan and most Arab states, yet there have been only small improvements in India and a deterioration in China.

The report expresses concern at the minimum expenses incurred by the government in health sectors, especially in developing countries. "Health systems in poor countries are severely under-funded for meeting the (Millennium Development) Goals," says the report. The World Health Organisation (WHO) estimates that $35-40 per capita is the bare minimum for basic health services.

Every high-income country spends at least 5% of its GDP on public health care. But few developing countries achieve that share - and in most it is less than half that.

Rural-urban disparities are another example of unfair spending. Rural areas usually get much less. In Cambodia, 85% of people live in rural areas, but only 13% of government health workers are located there. In Nepal, only 20% of rural physicians' posts are filled, compared with 96% in urban areas.

While discussing measures to redress imbalances in health care coverage, the report says that disease-specific programmes should be integrated with overall health structures. The report cites India's successful tuberculosis Directly Observed Therapy Short-course (DOTS) programme, where the existing health structure was used to fight the disease. More than 200,000 health workers have been trained and 200,000 deaths have been prevented, with indirect savings of more than $400 million, which is more than eight times the cost of programme implementation. About 436 million people (more than 40% of the population) were covered under the programme.

Andhra Pradesh, Karnataka, Kerala and Tamil Nadu have been commended for better drug distribution through the primary health care network. In other countries providing essential drugs through decentralised facilities could help revive primary health systems. Providing curative services would also expand the coverage of preventive services. It is said that in countries with high human development, almost the entire population has access to essential drugs, whereas the situation in countries with low human development is the reverse. But Bhutan, which has a low human development ranking, has succeeded in providing essential medicines to 80-94% of its population.


HDR 2003 emphasises popular participation through effective decentralisation. Emphasising the flexible functioning of decentralisation, the report says that in a good decentralised system, local services respond fast. Dhar district in Madhya Pradesh is cited as an example, where a rural community intranet project Gyandoot, started in January 2000, enabled prompt response to an early e-mail warning, preventing the outbreak of a cattle epidemic.

The report discusses the importance of decentralisation by citing examples from West Bengal, Kerala and Rajasthan. The Kerala People's Campaign was initiated in 1996 in response to the state government's decision to devolve 35-40% of state plan funds to village and municipal bodies. In its first two years the campaign led to the construction of 98,494 houses, 240,307 sanitary latrines, 17,489 public taps and 50,162 wells. The campaign succeeded in mobilising people from a cross-section of society. More than 30% of project funds were dedicated to providing housing for scheduled caste and scheduled tribe communities. Under the Women Component Plan, 10% of every project budget was committed to projects benefiting women, such as vegetable gardening, sewing cooperatives, mobilisation of anganwadi (preschool) personnel and establishment of community centres for women.

The report states that the successful implementation of education projects by panchayat and district administrations in Madhya Pradesh and Rajasthan has helped increase literacy rates. Madhya Pradesh implemented panchayati raj in 1994. Between 1991 and 2001 Madhya Pradesh improved its literacy rate by 20 percentage points, from 44% to 64%. Similarly, literacy rates in Rajasthan rose by 22 percentage points, from 39% to 61%. Rajasthan's success in improving literacy was driven by the 1987 Shiksha Karmi project and 1992 Lok Jumbish project.

Operation Barga in West Bengal enabled panchayats to boost agricultural technology and reform land tenancy. It also helped register 1.4 million sharecroppers.

The report also mentions the Mazdoor Kisaan Shakti Sangathan's success in making public documents available to people through 'social audits' in Rajasthan.

Ensuring environmental sustainability

Soil degradation affects nearly 2 billion hectares, damaging the livelihoods of up to 1 billion people living on dry lands. Around 70% of commercial fisheries are over-exploited, and 1.7 billion people, a third of the developing world's population, live in countries facing water stress.

Rich countries generate most of the world's environmental pollution and deplete much of its natural resources. Key examples include depletion of the world's fisheries and emission of greenhouse gases that cause climate change. In rich countries per capita carbon dioxide emissions are 12.4 tonnes, while in middle-income countries they are 3.2 tonnes and in low-income countries, 1.0 tonnes.

Poor people are also the most vulnerable to environmental shocks and stresses, including floods, prolonged drought and the emerging effects of global climate change. In normal times India's biodiversity-related products (such as wild fruits or honey) account for about 20% of the incomes of poor rural people. But during drought they account for more than 40% because cultivated crops fail. Taking such situations into consideration, the report says that "ignoring environmental sustainability, even if doing so leads to short-run economic gains, can hurt poor people and undermine long-run poverty reduction."

According to HDR, more than 80% of energy in the poorest countries comes from traditional sources such as dung, crop residue and fuelwood. Inefficient stoves and heating technologies often force local people to gather traditional fuels at a rate that exceeds the natural regeneration of these resources, degrading land and also creating health-damaging air pollutants. Solutions to such problems involve linking changes in energy consumption patterns in rich countries to the use of low-cost, low-emission technologies in developing countries.

Realising the importance of environmental sustainability, the report emphasises that environmental management should not be treated separately from other development concerns. "To achieve significant, lasting results, it must be integrated with efforts to reduce poverty and achieve sustainable development. Successful environmental policies must see poor people not as part of the problem but as part of the solution."

The report also says that poor people must have rights to common resources, which may require reforming policies and institutions that control access to land and natural resources. Also women's property rights should be strengthened, because women tend to be more dependent on environmental resources for their livelihoods.

Citing Costa Rica's Area de Conservación Guanacaste (ACG), started in 1985, the report emphasises the role of decentralisation in improving the environment. ACG is a new model of conservation where through decentralised decision-making wild lands have been transformed into productive assets, making conservation economically sustainable.

The HDR criticises the government policies of direct or hidden subsidies that send the wrong signals by pricing environmental resources inappropriately. Reducing environmentally damaging subsidies is often far more cost-effective than directly regulating economic activity.

"Several international environmental agreements have drawn attention to the need to manage the global environment. But implementation of these agreements could be improved. Greater emphasis should be placed on the needs of poor people, particularly in reaching the Goals," emphasises HDR

Achieving the Millennium Development Goals: The problem of declining aid

The overall focus of HDR 2003 is on the commitments made by countries in achieving the Millennium Development Goals (MDG) adopted by the 189 counties- rich and poor -- at the UN Millennium Summit in September 2000. The MDG Compact consisted of eight goals and 18 targets which are to be achieved by 2015. Some of the major goals are to eradicate poverty, promote human dignity and equality and achieve peace, democracy and environmental sustainability.

"It is hard to achieve the MDG without policy changes in rich countries. Poor countries cannot on their own tackle the structural constraints that keep them in poverty traps," says HDR.

Poor countries must improve governance to mobilise and manage resources more effectively and to implement policy reforms to strengthen economic governance, giving poor people a say in decision-making. Rich countries must increase aid, debt relief, market access and technology transfers.

HDR reveals that various studies have estimated that external aid will need to increase by $40-100 billion a year. Between 1990 and 2001 official development assistance fell from 0.33% to 0.22% of donor countries' gross national income. Declining aid has hit hardest the regions and countries in greatest need. Sub-Saharan Africa and South Asia saw dramatic drops in per capita aid in the 1990s.

The report adds that though the Millennium Development Goals target aid to the least developed countries, these countries have not been fully protected from aid cuts. Of the 49 least developed countries, 31 receive less aid today (8.5% of their average GDP) than in 1990 (12.9%).

Aid for basic social services - critical for achieving the health, education, hunger and water and sanitation goals - remains less than 15% of bilateral donor allocations. It is rising, however, and Austria, Ireland, Luxembourg, the Netherlands, the United Kingdom and the United States have hit the 20% target.

The report, while insisting on increase of aid by donor countries, also advises the poor countries to adopt effective and accountable policy systems to fight corruption and ensure that external resources are not wasted.

The Heavily Indebted Poor Countries (HIPC) initiative, begun in 1996 to reduce debt and release funds to support poverty reduction in poor countries, was effective, says HDR. By early-2003 the HIPC initiative had benefited 26 countries. For these countries debt service declined from $3.7 billion in 1998 to $2.2 billion in 2001, or from 17.5% of exports to 9.8%. Governments in these 26 countries are using their debt savings to increase spending on education and health, with about 40% directed to education and 25% to health. Uganda has achieved almost universal primary enrolment, while Mali, Mozambique and Senegal plan to use their freed debt to increase spending on HIV/AIDS prevention.

Another startling fact revealed by the report is about high tariffs against developing countries. In the 1990s the average Organisation for Economic Cooperation and Development (OECD) tariff on manufactured goods from the developing world was 3.4%, more than four times the average of 0.8% on OECD manufactures. Bangladesh exports goods and services worth about $2.4 billion to the United States each year and pays 14% in tariffs, while France exports more than $30 billion and pays 1% in tariffs.

HDR recommends that all countries pursue a development strategy that meets their specific needs. National strategies should be based on solid evidence, good science and proper monitoring and evaluation. National programmes must also respect human rights, support the rule of law and commit to honest and effective implementation. When these conditions are met, poor countries should be able to count on much more assistance from rich countries, both in finance and in fairer rules of trade, finance, science and technology.

Already more than two dozen poor countries have prepared Poverty Reduction Strategy Papers (PRSPs), which provide frameworks for financing, implementing and monitoring such strategies. The papers describe macroeconomic, structural and social policies and programmes to promote growth, reduce poverty and make progress in areas such as education and health, indicating external financing requirements. Governments through participatory processes involving civil society and external partners, including the World Bank and International Monetary Fund (IMF), prepare PRSPs.

Bad governance, according to HDR, is one of the prime and common reasons for slow economic development in poor countries. "When governments are corrupt, incompetent or unaccountable to their citizens, national economies falter," says HDR. "When income inequality is very high, rich people often control the political system and simply neglect poor people, forestalling broadly based development. Similarly, if governments fail to invest adequately in the health and education of their people, economic growth will eventually peter out because of an insufficient number of healthy, skilled workers. Without sound governance -in terms of economic policies, human rights, well-functioning institutions and democratic political participation -no country with low human development can expect long-term success in its development efforts or expanded support from donor countries."

International financial institutions like the World Bank and International Monetary Fund (IMF) should put the Millennium Development Goals at the centre of their analytical, advisory and financing efforts for every developing country. These institutions should help the poor countries determine the goals of PRSP and measures required to achieve the goals.

Regional development banks also have a major role in putting the Goals at the centre of their country strategies and in streamlining their lending operations and technical cooperation efforts. They are in a unique position to finance regional public goods and encourage regional integration and cooperation.

The potential role of UN agencies in helping countries meet the MDGs is also emphasised in the report. "The United Nations has extensive expertise in every focus area of the Goals, including education, health, development planning, technological development, the rule of law, agriculture and many others. Each of the main UN agencies should develop a strategy for helping low-income, low-human-development countries to implement their national strategies."

Emphasising the role of civil society, HDR reflects the three roles of civil society: as participants in the design of strategies, as service providers through community organisations and national NGOs and as watchdogs to ensure government fulfillment of commitments.

(InfoChange News & Features, August 2003)