Economy Prelims Plus
Context
If every nation consumed resources at the rate of the United States or the European Union, we would need multiple earths to sustain our way of life. Yet, international benchmarks such as the United Nations’ Human Development Index (HDI) continue to project these nations as aspirational models of development.
For decades, the HDI has shaped how countries, including India, perceive progress.
The index focuses on three dimensions: life expectancy, education, and income. But it ignores a crucial fourth dimension — the environmental pressures that inevitably accompany high HDI scores.
Countries such as Ireland, Norway and Switzerland that top HDI rankings, are among the world’s biggest resource consumers and carbon polluters per person.
High-income countries have already overshot multiple planetary boundaries, ranging from greenhouse gas emissions and ecological destruction to over-pollution.
The HDI’s failure to account for these transgressions promotes a misguided and unsustainable model of development, celebrating the gains of affluence to the few without conceding its cost to the collective.
Planetary Pressures - adjusted HDI (PHDI).
In response to decades of critique from sustainability experts, the UN introduced a modified index in 2020: the Planetary Pressures-adjusted HDI (PHDI). This measure downgrades HDI scores for countries with high environmental impacts.
Costa Rica has achieved impressive outcomes — high life expectancy, universal health care, and near-universal literacy — while maintaining a resource footprint that is far lower than that of affluent nations.
Decades of strategic investments in renewable energy and forest conservation have enabled it to align human development with environmental stewardship
Human Development Index (HDI)
India’s ranking on the United Nations Human Development Index (HDI) improved by one position in 2022 to 134 out of 193 countries ranked compared to 135 out of 191 countries in 2021. Switzerland has been ranked number one.
The index is produced by the Human Development Report Office for the United Nations Development Programme (UNDP).
HDI is a composite index that measures average achievement in human development taking into account indicators such as
1Life expectancy at birth (Sustainable Development Goal (SDG) 3),
2Expected years of schooling (SDG 4.3),
3Mean years of schooling (SDG 4.4)
4Gross national income (GNI) (SDG 8.5).