Revision summary
HDI combines life expectancy, education and GNI per capita into one average. India’s recent HDI is in the medium band, around 0.64, with a rank still in the 130s. IHDI reduces that score for inequality; India has often lost about thirty per cent of HDI to uneven shares. Inclusive growth needs the extra income and services to reach the bottom, which HDI alone can hide. IHDI is therefore the better national test, alongside the multidimensional poverty index.
Model answer
Introduction
Average glory can hide a cruel inside. The Human Development Index is an average of health, schooling and income. The Inequality-adjusted Human Development Index asks how much of that average is lost because people do not share those goods evenly. For India, that second number is the more honest face of inclusive growth.
Body
HDI
UNDP’s HDI combines life expectancy, education (mean and expected years of schooling) and GNI per capita. India’s HDI has climbed over three decades with longer lives, more children in school, and higher average income. In recent Human Development Reports India sits in the medium human development band, with an HDI a little above 0.64 and a rank still in the 130s among 190-odd countries. That is progress from the 1990s. It is not a rich-country score. It is also an average. A software-export city and a hungry block can share one national HDI.
IHDI
The IHDI discounts each dimension for inequality. If two countries have the same HDI, the one with a more equal spread of years of life, years of school and income will have a higher IHDI. The gap between HDI and IHDI is the loss due to inequality. For India that loss has often been around thirty per cent — among the larger losses in the medium-HDI group. Women, Adivasi districts, and the poorest wealth quintile pull the IHDI down while the national average still rises.
Why IHDI is better for inclusive growth
Inclusive growth means the extra GDP is felt in more lives, not only in a per-capita mean. HDI already beats raw GDP because it counts health and school. IHDI beats HDI because it punishes concentration. India’s Multidimensional Poverty Index (NITI Aayog / UNDP method) has fallen, which is good news. The Gini of consumption is moderate by world standards, but wealth and learning outcomes remain skewed. If HDI rises while IHDI stalls, growth is not inclusive. Policy then has to aim at public health in poor districts, school quality, and income at the bottom, not only at a headline GDP rate of six to seven per cent.
The better indicator is the one that cannot be flattered by a rich tail.
Flow diagram
flowchart TD H[HDI average] --> L[Life school income] I[IHDI] --> H I --> N[Penalty for inequality] N --> INC[Inclusive growth test]
Conclusion
HDI averages health, school and income. IHDI lowers that average when those goods are unequal. India’s inequality loss is large, so IHDI is the stricter, and better, test of inclusive growth.
Quick related
Students also ask
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Examine the pattern and trend of public expenditure on Social Services in the post-reforms period in India. To what extent this has been in consonance with achieving the objective of inclusive growth?( ).
Next question on this syllabus topic (2024 · Q1). View answer →
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Can GDP growth raise HDI without raising IHDI?
Yes, if the extra income and better schools stay with those who already have them.
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Is IHDI a poverty line?
No. It is a discounted human-development score. MPI is the closer poverty measure.
PYQ trend
When UPSC asked this
Related PYQs from other years, newest first. Open a question to read it.
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2024 · Q1 · GS III · 10 marks
Examine the pattern and trend of public expenditure on Social Services in the post-reforms period in India. To what extent this has been in consonance with achieving the objective of inclusive growth?( ). -
2022 · Q2 · GS III · 10 marks
Is inclusive growth possible under market economy ? State the significance of financial inclusion in achieving economic growth in India. -
2020 · Q1 · GS III · 10 marks
Explain intra-generational and inter-generational issues of equity from the perspective of inclusive growth and sustainable development. -
2019 · Q11 · GS III · 15 marks
It is argued that the strategy of inclusive growth is intended to meet the objectives of inclusiveness and sustainability together. Comment on this statement. -
2017 · Q13 · GS III · 15 marks
What are the salient features of 'inclusive growth'? Has India been experiencing such a growth process? Analyze and suggest measures for inclusive growth. -
2016 · Q6 · GS III · 12 marks
Comment on the challenges for inclusive growth which include careless and useless manpower in the Indian context. Suggest measures to be taken for facing these challenges.
More from this topic
Q1 · UPSC Mains 2024 · GS III · 10 marks
Examine the pattern and trend of public expenditure on Social Services in the post-reforms period in India. To what extent this has been in consonance with achieving the objective of inclusive growth?( ).
Inclusive Growth
After 1991, social-services spending did not jump at once; it thickened from the mid-2000s with school, health, work and food missions. States spend more on social services than the Union; education is the largest slice and health is smaller. The direction matches inclusive growth: more public money on people, not only on factories. The match is incomplete because learning, public health and out-of-pocket medical costs still exclude many. Inclusive growth is tested by who is reached, not by the size of a budget head alone.
Q2 · UPSC Mains 2022 · GS III · 10 marks
Is inclusive growth possible under market economy ? State the significance of financial inclusion in achieving economic growth in India.
Inclusive Growth
A market economy does not by itself deliver inclusive growth; it rewards those who already hold assets. Inclusion is possible when the State provides public goods and repairs missing credit and insurance markets. India pairs liberalisation with MGNREGA, NFSA 2013 and Direct Benefit Transfer. Financial inclusion (Jan Dhan, JAM, UPI, Mudra, PM-Kisan) channels savings, cuts leakage and supports demand. Significance for growth depends on actual use of accounts and fair credit, not on account-opening numbers alone.
Q1 · UPSC Mains 2020 · GS III · 10 marks
Explain intra-generational and inter-generational issues of equity from the perspective of inclusive growth and sustainable development.
Inclusive Growth
Intra-generational equity is fairness among people alive now; it is the core of inclusive growth. Inter-generational equity is fairness toward the unborn; it is the core of sustainable development. Jobless or unequal booms fail the first test even when GDP rises. Aquifer mining, carbon lock-in, and weak environmental clearance fail the second. Policy must raise present capability without running down the ecological and fiscal stock.
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