Journal of Population and Development, June 2023 | Tulasa Devi Dulal /Status of Human Development Index ...

Received Date: January 2023 Revised: March 2023 Accepted: June 2023
DOI: https://doi.org/10.3126/jpd.v4i1.64256

Status of Human Development

Index with Reference to Nepal
*Tulasa Devi Dulal

Abstract
This paper is based on ‘the status of Human Development Index (HDI)’since 1990 to 2022.
Even though the term "human development" is frequently used, its meaning varies depending
on the region. The first time Human Development Report (HDR) was introduced in 1990s and
new approach and indices for advancing human flourishing in the different time interval. The
mainpurpose of this paper is to track the trends in national human development indices and to
observe the circumstances surrounding human development. Primary source of secondary data
used for meta-analysis of human development reports and related materials.The HDR emphases
on a distinct issue that effect on measuring the multi-dimensional human development. HDI is
getting popular to measure the development of a country with related to socio-economic status.
It combines three critical indicators namely; education, life expectancy and standard of living.
Nepal’s HDI position is143 rdranked, among 191 countries in 2021. HDI reports shows in 2022
puts the 0.602value. So, Nepal is Medium human development category. Between 1990 and 2022,
Nepal's HDI value changed from 0.399 to 0.602, a change of 50.9 percent. Bagmati province
scores the highest HDI value with (0.669) and Kathmandu valley has the highest HDI score with
0.622 values. In comparison with rural areas, urban regions have a higher score, but the gap
narrows for the rural areas. So, the Nepalese’s Human Development Indicators are increasing
trends.

Keywords: Human development index, life expectancy, Education, Income and Inequality.

Introduction
The United Nations Development Programme (UNDP) formally accepted the idea of
human development in the late 1980s and early 1990s. The first Human Development
Report, published in 1990, used the HDI to gauge the status of each nation. The notion
of human development was put into reality with the help of renowned South Asian
economists Mahbub Ul Haq and Amartya Sen (UlHaq, 1995).
* Miss. Dulal is a Faculty Member of Development of population studies, PMC. Patan Dhoka, Lalitpur.
Email: [email protected]

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The UNDP revolutionized development theory, measurement, and policy in 1990 when it
released its first annual HDR and introduced the HDI. According to Shanton (2007), the
Human Development Report (1990) defined "Human Development" as the advancement of
human well-being and offered statistics at the national level for evaluating states' positions
in relation to well-being indicators. The UNDP's efforts to publish the HDR increased our
shared understanding of development and made measurement and comparison tools more
accessible to governments, NGOs, and researchers. Three indicators were employed in
the report: one from the social, one from the economic, and one from the health sectors
(Dhungel, 2018).
Human development is a process of enlarging the range of people's choices. Thus,
enlarging range of people’s choices is the most significant aspect of human development.
People’s choices may involve a host of other issues but, living a long and healthy life,
being educated and have access to resources needed for a decent standard of living
including political freedom, guaranteed human rights and personal self-respect are
considered some of the non-negotiable aspects of the human development. It is a process
of enlarging the range of people's choices, increasing their opportunities for education,
health care, income, empowerment and covering the full range of human choices from
a sound physical environment to economic, social and political freedom (Izhar Ahmad,
2023).
Human Development Theory has roots in ancient philosophy and early economic
theory. Aristotle noted that "Wealth is evidently not the good are seeking, for it is merely
useful for something else". Adam Smith and Karl Marx were concerned with human
capabilities. The theory grew in importance in the 1980s with the work of Amartya Sen and
his Human Capabilities perspective, which played a role in his receiving the 1998 'Nobel
Prize in Economics'. Then Sen’s book, Commodities and Capabilities, came out in 1985
and a further study called The Standard of Living, came out in 1987, and based on his
1985 Cambridge lectures. His publications included Development as Freedom. Notable
early active economists who formulated the modern concept of human development
theory were Mahbub ul Haq, Üner Kirdar, and Amartya Sen. The Human Development
Index developed for the United Nations Development Programme (UNDP) stems from
this early research. In 2000, Sen and Sudhir Anand published a notable development of
the theory to address issues in sustainability (Anand S.& Sen A, 2000).
Most important things there were a series of North-South Roundtables organized by Uner
Kirdar, and Khadija and Mahbub ul Haq, in the 1980s used the term ‘human development’

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referring to a subset of issues, not an overall approach. The human development approach,
developed by the economist Mahbub Ul Haq, is anchored in Amartya Sen’s work on
human capabilities, often framed in terms of whether people are able to “be” and “do”
desirable things in life (Klikemann Hans Dieter, 2003).
Freedom of choice is central: someone choosing to be hungry (during a religious fast say
is quite different to someone who is hungry because they cannot afford to buy food. As the
international community seeks to define a new development agenda post-2015, the human
development approach remains useful to articulating the objectives of development and
improving people’s well-being by ensuring an equitable, sustainable and stable planet
(HDR, 2015).
The debates that erupted around the world in the second half of the 20th century about the
connections between economic growth and development gave rise to human development.
At the beginning of the 1960s, there were growing cries to "dethrone" GDP because,
although GDP was never meant to be a gauge of well-being, economic growth had become
a key goal and an indicator of national advancement in many nations. During the 1970s
and 1980s, there was discussion about alternative development focuses that went beyond
GDP. These included emphasizing employment more than GDP, then redistribution with
growth, and finally, whether or not people had their basic needs met (Kennedy & Robert,
1968).
A well-known example of a social indicator of development is the Human Development
Index (HDI), which combines one economic indicator (Gross National Income) with
two social indicators: life expectancy and years of schooling into one score and ranks
countries accordingly. It is a composite index focusing on three basic dimensions of human
development: the ability to lead a long and healthy life, measured by life expectancy at
birth; the ability to acquire knowledge, measured by mean years of schooling and expected
years of schooling; and the ability to achieve a decent standard of living, measured by
gross national income per capita. Each of the components is normalized to scale between
0 and 1, and then the geometric mean of the three components is calculated (Rasure,
2023).

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The HDI determines the lowest and highest value for each dimension, sometimes known as
"goalposts," and then shows the position of each country with respect to these objectives.
For every dimension, the index value is computed on a 0–1 scale, where 0 represents the
lowest value and 1 the maximum value assigned to the corresponding indication. The
HDI value of a nation rises as human development level does.

Measures
Life expectancy at birth: The life expectancy index helps determine the likelihood of a
long and healthy life. For instance, the life expectancy index (LEI) is 1 at birth for people
who are 85 years old, and 0 for people who are 20 years old.
Expected years of schooling & Mean years of schooling: It comes under the knowledge
dimension of the HDI index. Acquired knowledge through mean and predicted years of
education is measured through the education index. The two Knowledge indicator values
are first normalized using a minimum value of 0 and a maximum value of 15 for the mean
years spent in school and 18 for the expected number of years.
per capita (PPP $): The GNI index is used in this technique to gauge a respectable
standard of living. PPP's low minimum value of $100 is used. There is a maximum value
of PPP $75,000.Since a poor performance on any index would immediately reflect in the
entire HDI, a good performance on the UN Human Development Index would require a
good performance on all dimensions. The values stated are based on the 2014 goal post.

HDI Formula
By using this formula, we can calculate the HDI values in the world. The Human
Development Index calculation involves multiple steps and formulas. It starts with

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calculating the index values: Life Expectancy Index (LEI), Education Index (EI), and
Income Index (II). Finally, HDI is the geometric mean of the three normalized indices.

Source: (Vaidya, 2022).

The specific indicators which institutions such as the World Bank and United Nations use
to measure how ‘developed’ a country is, and the main indices are used to compare the
levels of development of different countries. Human Development is described as the
process of enhancing human potential in terms of skills and rights. It believes that good
health and education are important for an individual’s total development because they
enable them to make decisions that will result in a happy and secure lifestyle. So, it is a
comparably broader concept. UNDP had an innovative concept that defines development
as the expansion of choices by enhancing capabilities. The Global Human Development

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Reports (HDR) is an annual publication released by the UNDP's Human Development

Report Office and contains the Human Development Index Within global HDR there
are four main indexes: Human Development Index, Gender-related Development Index,
Gender Empowerment Measure and the Human Poverty Index (UNDP, 2010).
The 2010 Human Development Report introduced the IHDI, which takes into account
inequality in all three dimensions of the HDI by ‘discounting’ each dimension’s average
value according to its level of inequality. The IHDI is basically the HDI discounted for
inequalities. The ‘loss’ in human development due to inequality is given by the difference
between the HDI and the IHDI, and can be expressed as a percentage. As the inequality in
a country increases, the loss in human development also increases (HDR, 2010).

UNDP published Human Development Report (HDR) in every year with countries ranked
values. HDI is one of the best tools to keep track of the level of development of a country,
as it combines all major social and economic indicators that are responsible for economic
development. The index is a summary measure for assessing long-term progress in three
basic dimensions of human development: a long and healthy life, access to knowledge
and a decent standard of living (The Economic Times, 2023).
Nepal has been publishing the Nepal Human Development Report since 1998, with the
focus shifting considering the needs of the country. In the 1990-2021 period, Nepal’s
human development index score rose from 0.380 to 0.602 HDI value. So the Nepalese’s
Human Development Indicators are increasing trends.

Objectives
- To identify the Status of Human Development Index with Reference to Nepal since
1990-2022.

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Methodology
This is paper completely based on secondary data. It has used meta-analysis of human
development reports, government reports, historical documents archives, statistics and
national planning commission reports, journals and articles. The HDI is calculated from
existing data of UNDP, that provide data. It is an attempt to explore the situation of human
development by nations, province, rural-urban etc. This article is expected to encourage
researcher, academics, policy maker and development partners to initiate discourse from
the perspective of development indicators. The findings may help for planning producing
development strategy.

Results and Discussion

Situation of Human Development Index Rank in the World
The first Human Development Report was printed in 1990 by the Pakistani economist
Mahbub ul Haq and the distinguished laureate of India, Amartya Sen. the Human
Development Index is a ranking system used by the United Nations to assess the well-
being of countries and measure their progress in multiple dimensions. The rankings are
based on various measurements such as life expectancy at birth, education levels, Gross
Domestic Product (GDP), poverty rates and Gender Inequality Index (GII). Countries
are ranked on a scale from 0 to 1 with 1 being the highest level of development. In 2021,
Switzerland, Norway, and Iceland all topped the HDI with a score of 0.96. Switzerland –
0.962, Norway – 0.961, Iceland – 0.959, Hong Kong – 0.952, Australia – 0.951, Denmark
– 0.948, Sweden – 0.947, Ireland – 0.945, Germany – 0.942, Netherlands – 0.941 (World
Population Review, 2023).
In contrast to this are the world's least-developed countries (LDCs), which tend to have
HDI scores below 0.55, in the "low human development" category. LDCs face unstable
governments, widespread poverty, lack of access to healthcare, and poor education.
Additionally, these countries have low income and low life expectancies, coupled with
high birth rates. The countries of low human development index are South Sudan 0.385,
Chad 0.394, Niger 0.400,Central African Republic 0. 404, Burundi 0.426, Mali 0.428,
Mozambique 0.446, Burkina Faso 0.449, Yemen 0.455, Guinea 0.465 (World Population
Review, 2023). This illustrates the fundamental purpose of the HDI: to help the United
Nations determine which countries (especially which least-developed countries) are most
in need of assistance.

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In the context of South Asian countries, the average HDI value is 0.632. South Asian
countries, do not figure the first category of very high human development in the world.
Sri Lanka has been placed under the high development category with the HDI value of
0.782 with a rank of 73, being the highest among the South Asian countries. Countries
such as India, Bhutan, Bangladesh, Myanmar and Afghanistan have attained a ranking
lower than their previous year's rankings (Panwar ,2022). Sri Lanka HDI value of 0.782
andMaldives score with 0.747 are two countries that are categorized under high human
development, while India 0.633, Bangladesh 0.661, Nepal 0.602, Bhutan 0.666 and
Myanmar 0.585 are under medium human development category. On the other hand,
Pakistan 0.544 and Afghanistan 0.478 are under the low human development category.
In contrast, countries such as Sri Lanka, Maldives, and Nepal have achieved higher ranks
than their previous year's ranks (Panwar, 2022).
Progress of HDI rank in Nepal
Nepal has been publishing the Nepal Human Development Report since 1998, with the
emphasis shifting based on the country's needs. Despite this, the country rose one spot in
the rankings. HDR Nepal's HDI value trend had been increasing until the country was hit
by the pandemic. The country's HDI value was as low as 0.399 in 1990, but it has steadily
increased in subsequent years, reaching 0. 611 in 2019. However, the Pandemic year took
away scores with 0.604 in 2020 and continued the trend with an HDI value of 0.602 in
2021 (The Kathmandu Post, 2022). The 2021 female Human Development Index value
for Nepal is 0.584 in contrast with 0.621 for males, resulting in a Gender Development
Index value of 0.942, placing it into Group 3, which consists of countries with medium
equality in Human Development Index achievements between women and men. Report
2022 puts the country in the Medium human development category (The Kathmandu
Post, 2022).
Nepal's life expectancy at birth changed by 13.6 years, mean years of schooling changed
by 2.8 years and expected years of schooling changed by 5.4 years. Nepal's GNI per
capita changed by about 146.0 percent between 1990 and 2021.The IHDI fell to 0.446
a 25.9 percent decrease, after being adjusted for inequity. This shows that as inequality
increases, the human development decreases (Bajracharya, 2021).Developing and
least developed countries like Nepal suffer more than developed countries in terms of
human development, due to climate change and other disasters caused by the non-stop
exploitation of the planet.

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Table 1: Nepal’s HDI trends based on consistent time series data and new goalposts
Time Life expectancy Expected Mean years GNI per HDI
at birth years of of schooling capita ( PPP$) value
schooling
1990 54.4 7.5 2.0 1,372 0.387
1995 58.6 8.1 2.2 1,553 0.419
2000 62.3 9.0 2.4 1,793 0.453
2005 65.3 9.5 2.8 1,993 0.482
2010 67.6 11.9 3.3 23,72 0.573
2015 69.5 12.7 4.7 29,57 0.583
2016 69.8 12.6 4.9 29,46 0.586
2017 70.2 12.6 4.7 31,35 0.588
2018 70.5 12.8 4.9 32,76 0.596
2019 70.8 12.8 5.0 34,57 0.587
2022 71.45 12.9 5.1 38,77 0.602
Source : Human Development Report (UNDP, 2022)
We offer data for Nepal from 1980 to 2021 for that indicator. With a minimum of 0.286
points in 1980 and a maximum of 0.602 points in 2020, Nepal's average score over that
time was 0.483 points. The most recent figure is 0.602 points from 2021. In contrast,
based on 184 countries, theglobal average in 2021 is 0.724 points. View the indicator's
global rankings or compare trends over time using the country comparator.
Figure-1: Global rankings for that indicators or use the country comparator to
compare trends over time.

Source: The Global Economy, 2021.

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Figure-2: Historical chart

Source: The Global Economy, 2021.

Nepal continues to remain among the lowest-ranked countries in South Asia in terms
of human development even though the country has made rapid progress in the last few
decades, a United Nations report says. In 2021, Nepal's human development index (HDI)
value was 0.602, ranking third worst after war-torn Afghanistan and Pakistan, which
has also recently experienced an economic crisis. These findings was comes from the
United Nations Development Programme (UNDP) report titled "Making our future: New
directions for human development in Asia and the Pacific" (The Post in Kathmandu,
2023).
Socio-economic well-being is a crucial indicator of development. It is also the ultimate
goal of every country. Financial inclusion is a way of improving the well-being of people
on the social and economic well-being of the households. The table shows the social
indicators Nepal.

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Table 2: Human Development Indicators and Indices in Nepal, 2020

SN Indices Indicators Score
1 Health Life expectancy at birth 70.8 Years
2 Education Expected years of schooling (years) 12.8
3 Income Gross national income (GNI) per 3,877
capita&PPP$
4 Inequality Inequality-adjusted HDI (IHDI) 0.446
5 Gender Gender Development Index (GDI) 0.933
6 Poverty Population in multidimensional poverty, 34.0
headcount (%)
7 Work, employment and Employment to population ratio (% ages 15 82.6
vulnerability and older)
8 Human Security Homicide rate (per 100,000 people) 2.3
9 Trade an Financial Flows Exports and imports (% of GDP) 54.9
10 Mobility and Internet users, total (% of population) 34.0
Communication
11 Environmental sustainability Carbon dioxide emissions, production 0.3
emissions per capita (tonnes)
12 Demography Total population (millions) (Data refers 33.4
to2030)
13 Socio-economic Skilled labour force (% of labour force) 41.9
sustainability
Source: HDR, 2020.
Table 2 shows that Nepal is progressing in the human development index and ranking, but
still required to work hard for future progress. Government needs to invest in the areas of
education, health, renewable energy, agriculture to build a resilient Nepal. The government
has been investing in increasing people’s access to health services in the villages. The
government is making special efforts to maximize the use of locally produced electricity,
including by providing free electricity to the poor and exporting excess energy to other
countries.
Human Development Index (HDR) 1998, mentions the national and local life such as the
societal structures, the trend of the polity and the economy that help to understand Nepal.
It provides a glimpse of past development and the concept and components of human
development based on the literature and the potentiality of human development in order
to harness in the future. Besides, inequalities by caste and ethnicity are also included in it
(UNDP-Nepal, 1998).

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Human Development Index according to new formed Provinces of Nepal

Nepal’s sub-national governing units are restructured into 753 local units with
renewed mandate, which is further classified into 6 Metropolis, 9 Sub-metropolis, 258
municipalities, 458 Rural Municipalities. Nepal’s national HDI score stood at 0.602 in
2022, which puts the country in the medium human development category. Its score in
urban areas (0.647) surpasses that of rural areas (0.561) with a large urban-rural gap.
Higher per capita income and better access to education and health services in urban areas
explain such striking disparities.
The HDI value also varies across provinces. As expected, Bagmati province scores the
highest (0.669), followed by Gandaki province (0.621). Koshi Pradesh, 0.580 and Lumbini
0.563, Sudur Paschim 0.547, Karnali 0.538. Province 2 scores the lowest (0.519) followed
by Karnali (0.538). This indicates the uneven distribution of development outcomes
across different parts of the country (UNDP 2019).
Table 3: Human Development Index according to Provinces of Nepal:
SN Province HDI Score
Medium Human Development
1 Bagmati province 0.669
2 Gandaki province 0.621
3 Koshi Pradesh 0.580
4 Lumbini 0.563
Low Human Development
5 Sudur Paschim 0.547
6 Karnali 0.538
7 Province 2 0.519
Sub National Level
8 Mountain 0.564
9 Terai 0.563
10 Hill 0.623
11 Rural 0.561
12 Urban 0.647
13 Nepal 0.602
Source: UNDP; 2019

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This indicates the uneven distribution of development outcomes across different parts of
the country. Among the ecological regions, areas defined as the hills continue to surpass
mountain areas and the Tarai, a pattern similar to findings in previous Nepal Human
Development Reports regardless of methodological differences. Contrary to the common
perception that people in the mountains are poorer than those in the Tarai, these two
regions score at the same level on the HDI (0.56) and lag behind the hills (UNDP, 2019).
The regional perspective of HDI—which is largely measured on the basis of life expectancy,
education and income—has improved in the areas that have made strides in literacy and
education such as Western Hills and Western Mountains.From the regional perspective,
the Kathmandu valley has the highest HDI score with 0.622, stemming largely from high
scores for educational attainment and level of per capita income. Kathmandu, Lalitpur
and Bhaktapur are at the top of the four highest-ranking HDI districts. This is the first
time in a decade that the HDI has been provided for all the 75 districts. Bajura, Bajhang,
Kalikot, Humla and Achham have the lowest HDI for 2011 (HDR 2014).
In comparison with rural areas, urban regions have a higher score, but the gap narrows
for the period 2006-2011. Urban HDI values remained constant over the period but they
have improved in the case of rural areas. "Remarkably, the difference in life expectancy
rates between rural and urban areas has narrowed considerably. From the point of view of
caste and ethnicity, Brahmins and Chhetris take the top spot in HDI values compared to
three other groups—Janajatis, Dalits and Muslims. The pattern was similar in 2006. Hill
Brahmins have the highest HDI (0.557) while Madhesi Dalits have the lowest. Brahmin
and Chhetris also have the highest per capita income followed by Janajatis and Dalits.
"Differences in educational attainment largely explain the inequality between high and low
HDI values for caste and ethnic groups," said the HDR report,2014. Although disparities
persist between males and females, political participation, economic participation
and power over economic resources have improved over the last decade. The gender
empowerment measures value has risen across all ecological and development regions,
notability in the Tarai, during 2006-2011 (The Kathmandu post, 2014).

Conclusions
The HDI measures overall human development, including factors such as life expectancy,
literacy, and GDP per capita in a country. The difference in HDI performance basically
depends on level of socio-economic development of the particular area. The differential
performance does not follow uniform trend because of socio-economic stricter of the
area. Some Provinces performing better in one indicator while rest in other indicators.
The HDI value increased from 0.320 (1996) to 0.522 (2011) by a margin of 63.85 percent.

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Nepal has been placed under the medium development category with an HDI score of
0.602 with a rank of 143 in world human development ranking in 2022. The HDI value
can be attributed to the life expectancy at birth of 68.4 years. Nepal's expected years of
schooling stand at 12.9 years and the mean years of schooling are at 5.1 years and GNI
per capita income is 3, 877 Rupees.
Nepal continues to incur a substantive loss in human development due to persisting
inequalities, according to UNDP. “Nepal continued to lose over 25 percent in human
development due to inequalities across gender, caste, geographic regions and other
categories”. The economic sector’s performance was relatively low. But the foreign
employments also have significant contribution for this change. The contribution of
health sector in overall improvement of HDI is also notably changed. While increasing
access of people to economic resources and opportunities, expansion of market activities
improvement in education/social sector, civic awareness, democracy practices and
government investment on health, education and economic development form a base for
this improvement.

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