Mumbai, Oct 21(UNI) A new Human Capital Index (HCI) launched by the World Bank has highlighted the perils of underinvestment in the key areas of health and education and stirred fresh debate in the development community on what this means for global investments in building human capital.
The HCI highlights that building people as human capital is as important as building roads and bridges, the physical capital, and only the two together drive economic growth, according to Billion Press here.
The first HCI was released earlier this month but the Index became controversial in India, where the government voiced “serious reservations about the advisability and utility of this exercise of constructing HCI”.
India sits at rank 115 out of 157 with an HCI of 0.44, which means an average child born in 2018 will be only 44 per cent as productive as that child would be under the benchmark of complete education and full health. India’s rank in the HCI listing is lower than that of Myanmar, Bangladesh, Nepal and Sri Lanka of 0.47, 0.48, 0.49 and 0.58 and ranks 107, 106, 102 & 74 respectively).
An economy in which the average worker achieves both full health and full education potential scores a value of 1 on the index.
The HCI number came soon after India was ranked 130 out of 189 countries in the 2018 data for the Human Development Index, which is a 28-year-old and well-accepted index from the United Nations Development Programme (UNDP). India’s HDI value for 2017 is 0.640, which puts the country in the medium human development category on a total of 142 indicators on health, education and income.
HDI is described as a summary measure of average achievement in key dimensions of human development: a long and healthy life, being knowledgeable and have a decent standard of living.
Between 1990 and 2017, India’s HDI value increased from 0.427 to 0.640, an increase of nearly 50 per cent – and an indicator of the country’s remarkable achievement in lifting millions of people out of poverty, the UNDP said.
But as Selim Jahan, Director of the Human Development Report Office at UNDP, has pointed out, “(HDI) data…tells only a part of the story about people’s lives. For instance, it is increasingly clear that it is not enough simply to count how many children are in school: we need also to know whether they are learning anything.”
The HCI fixes this gap. It uses, for example, harmonised test scores and years at school adjusted for what the students learn to measure and survival and stunting rates to predict potential productivity of children born in a given year.
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