Human Development Index (HDI)

 HDI measure was given by Pakistani Nobel prize Winner Economist, Mehbub-ul-Haq.

Estimates/Causes

·        Measured by Human Development Index (HDI), published by UNDP since 1990.

·        Three dimensions

(1)   1 Life expectancy at birth rate;

(2)   2 Education index comprising means year of schooling and expected year of schooling;

(3)   3 GNI per capita (PPPUS $) Index.

Programmes/Measures

·  NRHM (National Rural health Mission) was Launched on 2^nd April, 2005 to reduce IMR and MMR.

·  Education programmes like Sarva Shiksha Abhiyan, Mid-Day Meal Scheme, Etc.

·  Rural development programmes like MGNREGA AND BHARAT NIRMAN.

Inequality

Programmes/Measures

·        Adoption of progressive taxation in India.

·        Anti-Poverty and employment generation programmes.

·        Land reforms like abolition of intermediation, land ceiling acts, tenancy reforms and co-operative movement were launched.

·        Rural development programmes.

·        Backward region grant fund.

Poverty

Estimates/Causes

·        Main Reasons for Rural Poverty Rapid population growth, lack of capital, lack of alternate employment other than agriculture, illiteracy and lack of proper implementation of PDS.

·        Main Reasons for Urban poverty  Migration from rural areas, lack of skilled labour, lack of housing facilities, limited job opportunities in cities.

·        Based on 2400 calories (rural) and 2100 calories (urban) and monthly per capita consumption expenditure of Rs 356 (rural) and 538 (urban), Planning Commission estimated poverty ratio in India in 2004-05 was 27.5%.

·        The Poverty ration or the number of poor as a percentage of total population in India for 2004-05 estimated at 37.2% according to the Suresh Tendulkar Committee.

Indian Tax Structure

Direct Tax The term direct tax generally means a tax paid directly to the government by the persons on whom it is imposed.

Indirect Tax  An indirect tax is a tax collected by an intermediary from the person who bears the ultimate economic burden of the tax.

The Government of India earns maximum form Corporate Income Tax.

Direct Tax                                                                 Indirect Tax

Income Tax                                                                Sales Tax or VAT

Corporation Tax                                                        Customer Duty

Capital Gain Tax                                                        Insurance Premium Tax

Stamp Duty                                                                Excise Duties

Land Tax

Estate Duty                                                                Landfill Tax

Wealth Tax                                                                 Aggregates Levy

Petroleum                                                                  Climate Change Levy

Revenue Tax

Inheritance Tax                                                          Goods and Services Tax

National Income of India

Domestic Product

Gross Domestic Product at Market Price =  Market value of final output of goods and services produced within the country’s domestic economy in a period of one year.

Net Domestic Product at market Price = GDP – Depreciation.

Net Domestic Product at Factor Cost = NDP – Indirect taxes + Subsidies.

National product

Gross National product at Market price = GDP+Net Factor Income from abroad.

Net national product at Market Price =  GNP – Depreciation.

Net National Product at Factor Cost or National Income = national product – Indirect Taxes + Subsidies.

Per Capital product/Income =  National income/Population or Net national Product at Factor Cost/population.

·        The first estimate of National Income was prepared by Dadabhai Naoroji and per capita income was calculated Rs 20 in 1870.

·        The First scientific estimate was made by Prof VKRV Rao using output and income methods for the year 1931-32.

·        National Income Committee was headed by Prof PC Mahalanobis, set up in 1949+ and provided for the first time comprehensive data of national income in 1954.

·        Conventional series with basic year of 1948-49 were divided the economy into 13 sectors. At present, the economy is divided into 9 sectors.

Indian Economy

Outline of Indian Economy Nature

Mixed Economy Existence of both public and private sectors. This term was coined by JM Keynes.

Agrarain Economy  Even after six-decades of independence 58% of the work force of India is stell agriculturist and its contribution to GDP is 14.5% in 2010-11.

Features

(1)   Slow growth of national and per capital income.

(2)   Capital deficiency and low rate of capital formation, hence low rate of investment, low production, etc; poor quality of human capital.

(3)   Over dependence on agriculture along with low productivity in agriculture; heavy population pressure.

(4)    Unequal distribution of income and wealth.

(5)   Mass poverty, chronic inflation and chronic unemployment.

Classification

·        According to the World Development Report (2012),  sub-titled Gender Equlty and Development, India with its per capital income of US $ 1340 is placed in lower middle income countries in 2010.

·        Even on PPP (Purchasing Power Parity) basis India with US $ 3560  is placed in middle income countries in 2010.

·        India has a share of 17.4% in world population but accounts for only 2.3% of world GNI on exchange rate basis.

Socio-Economic Indicators

·        Per capital daily intake calorie is 2496 (in 1999).

·        Poverty Level more than 37% (Tendulkar Committee).

·        With HDI  value of 0.547, India ranked 134/187, and hence has a medium human development (HDR 2011).

·        Inequality in India, in terms of Gini co-efficient of 0.36 is huge.

·        Illiteracy more than one-fourth of population.

Issues in Development

(1)   Low per capital income and low rate of economic growth.

(2)   High proportion of people below the poverty line.

(3)   Low level of productive efficiency due to inadequate nutrition and malnutrition.

(4)   Imbalance between population size, resources and capital.

(5)   Problem of unemployment.

(6)   Instability of output of agriculture and related sectors.

(7)   Imbalance between heavy industry and wage goods.

(8)   Imbalance in distribution and growing  inequalities.