India falls behind even Bangladesh and West Bank in Human Capital Index

The World Bank Human Capital index seeks to measure the productivity that a child born can expect to attain by the time he turns 18

It may come as a surprise to many, but the West Bank and Gaza region, a conflict zone, ranks higher on human capital than India. In fact, even countries like Bangladesh and other emerging economies like Indonesia and Malaysia rank higher than India on human capital.

Launched last week, the World Bank Human Capital index measures the amount of human capital that a child born today can expect to attain by age 18. Put differently, it seeks to measure the productivity of the next generation of workers, based on benchmarks of education and health.

The report, the first of its kind in the area of rankings, placed India at 115th spot out of 157 countries. Singapore topped the rankings, followed by Korea and Japan (see chart), while China ranked 46th.  

The human capital index is constructed on three pillars, namely survival, expected years of quality-adjusted schooling and health environment. A country’s performance on each of these pillars is, in turn, measured through indicators such as the probability of surviving to age 5, the number of years of school a child can expect to obtain by age 18, test scores on select international testing programmes, the probability of surviving from age 15 to age 60 and the proportion of children under 5 with below normal height-for-age.

The index uses probability as the unit in some of the indicators used. A probability of 1 means certainty of an event (say the probability of 2 plus 2 being 4), that nearing 1 means that the event is more probable (say the general elections happening on the date as scheduled). A probability of zero means that the event is improbable (say sighting sun in the night), while that near to 0 means that the event is less probable (say the chance of getting stuck in a traffic jam for more than three hours).

The report shows that high-income developed European countries lead the rankings on most of these measures. For instance, in terms of the probability of surviving to age 5, Iceland leads globally with a score of 0.998 implying that all its children survive as they reach the age of 5. On this measure, India is placed behind even Brazil. The probability of a child below 5 surviving in India has been estimated at 0.961 in 2017, up from 0.908 in 2000. In comparison, for Brazil, this metric is estimated at 0.985 in 2017 (See chart).

Similarly, on the number of years of education, France leads the rankings, followed by Czech Republic and Sweden. On this indicator, India, where the expected years of schooling is estimated at 10.2 years, ranks behind even Mexico and Nepal (See chart).

On stunting and wasting, India’s poor performance over the past years has been widely documented. As the report shows, a little over a third of children below age 5 in India are stunted. In comparison, even in countries like South Sudan and Liberia, it is less than a third (See chart).

On adult survival too, while India has improved its performance over the past decade, it continues to fare poorly. The country’s score on adult survival has risen from 0.77 in 2000 to 0.825 in 2017. In comparison, the adult survival rate was higher even in countries like Algeria and Colombia.