Human Development Report by UNDP

World Bank’s Human Capital Index 2020

Note4Students

From UPSC perspective, the following things are important :

Prelims level : HCI, HDI

Mains level : Impact of coronovirus outbreak on Human Capital

India has been ranked at the 116th position in the latest edition of the World Bank’s annual Human Capital Index that benchmarks key components of human capital across countries.

Try this PYQ:

Q.As per UN-Habitat’s Global Report on Human Settlements 2009, which one among the following regions has shown the fastest growth rate of urbanization in the last three decades?

(a) Asia

(b) Europe

(c) Latin America and Caribbean

(d) North America

Highlights of the 2020 rankings

  • The 2020 Human Capital Index update includes health and education data for 174 countries — covering 98 per cent of the world’s population — up to March 2020.
  • It provides a pre-pandemic baseline on the health and education of children, with the biggest strides made in low-income countries.

Impact of the pandemic

  • The analysis shows that pre-pandemic, most countries had made steady progress in building the human capital of children, with the biggest strides made in low-income countries.
  • The pandemic puts at risk the decade’s progress in building human capital, including the improvements in health, survival rates, school enrollment, and reduced stunting.
  • The economic impact of the pandemic has been particularly deep for women and for the most disadvantaged families, leaving many vulnerable to food insecurity and poverty.
  • Due to the pandemic’s impact, most children — more than 1 billion — have been out of school and could lose out, on average, half a year of schooling, adjusted for learning, translating into considerable monetary losses.
  • Data also shows significant disruptions to essential health services for women and children, with many children missing out on crucial vaccinations.

India’s performance

  • India’s score increased to 0.49 from 0.44 in 2018, as per the Human Capital Index report released by the World Bank.
  • Last year, India had raised “serious reservations” over the Human Capital Index, wherein India was ranked 115 out of 157 countries.
  • This year India finds itself at 116th from among 174 countries.

Back2Basics: Human Capital Project

  1. As part of this World Development Report (WDR), the World Bank has launched a Human Capital Project (HCP).
  2. The HCP programme is claimed to be a program of advocacy, measurement, and analytical work to raise awareness and increase demand for interventions to build human capital.
  3. There are three components of HCP:
  • a cross-country human capital measurement metric called the Human Capital Index (HCI),
  • a programme of measurement and research to inform policy action
  • a programme of support for country strategies to accelerate investment in human capital.

Human Capital Index (HCI)

  1. The HCI has been constructed for 157 countries.
  2. It claims to seek to measure the amount of human capital that a child born today can expect to attain by age 18.
  3. The HCI has three components:
    • Survival: as measured by under-5 mortality rates
    • Expected years of Quality-Adjusted School: which combines information on the quantity and quality of education
    • Health environment: Using two proxies of (a) adult survival rates and (b) the rate of stunting for children under age 5. 

HDI vs. HCI

  1. UNDP constructs Human Development Index (HDI) for several years.
  2. The HCI uses survival rates and stunting rate instead of life expectancy as a measure of health, and quality-adjusted learning instead of merely years of schooling as a measure of education.
  3. HCI also excludes per capita income whereas the HDI uses it.
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