Institute for Human Development Globalizing India Dev Nathan Institute for Human Development New Delhi Duke University, USA

Why Economic Growth? For itself? As means to human development? Two measures Economic development – GDP or GDP per capita Human development – HDI Is there a relation between GDP (GNI) and HDI?

HDI Three components of HDI Income Educational attainment Health /nutrition status Is there a relation between income (GDP) and human development (HDI)? As component As instrumental variable

GNI and HDI Low HDI – Avg. 0.456 Medium HDI – Avg. 0.630 High elasticity of HDI with respect to GNI (>1) Medium HDI – Avg. 0.630 Medium elasticity (0.75 to < 1) High HDI – Avg. 0.741 Low elasticity (between 0.50 to 0.75) Very High HDI – Avg. 0.889 Very low elasticity

HDI of Regions Arab States - 0.641 East Asia and the Pacific - 0.671 Europe and Central Asia - 0.751 LA and C - 0.731 South Asia - 0.548 Sub-Saharan Africa - 0.463 LDCs - 0.439

Does we need economic growth for human development? Distinguish between countries at different HDI levels Need for growth falls with increase in HDI Our need for growth as instrumental to human development is different from the need of capital to grow

Structure of world economy Developing economies – middle to low income, including emerging economies Developed economies – high income Asia, Africa and Latin America Market of about $12 trillion, or 36 percent of global gross domestic product in 2012, up from 10 percent in 1980

Projected Income for India by OECD

Size of economies GDP - per capita income and population size With population more than thrice that of USA, at one-third the per capita income, the Chinese and Indian economies will be larger than that of the US In PPP terms even earlier

Growing Openness of the Indian Economy?

Key External Debt Indicators

India: Poverty Ratio among Social Groups, 1993-94, 2004-05 and projected to 2015-16