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Home Economy

Human Capital Index 2020

January 26, 2021
in Economy
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Human Capital Index 2020
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  • The World Bank released the Human Capital Index (HCI) report for 2020. The index benchmarks key components of human capital across countries.
  • India has been ranked at the 116th position in the HCI 2020.

Important Points

  • Human Capital: It consists of the knowledge, skills, and health that people accumulate over their lives, enabling them to realize their potential as productive members of society.
  • Parameters Used in HCI: The HCI 2020 includes health and education data of children for 174 countries up to March 2020. Thus providing a pre-pandemic baseline.It covers 98% of the world’s population.
  • Outcome: The HCI 2020 shows that pre-pandemic, most countries had made steady progress in building human capital of children, with the biggest strides made in low-income countries.
    However, despite this progress, a child born in a typical country could expect to achieve just 56% of their potential human capital, relative to a benchmark of complete education and full health.

Impact of the pandemic

  • The analysis shows that pre-pandemic, most countries had made steady progress in building the human capital of children, with the biggest strides made in low-income countries.
  • The pandemic puts at risk the decade’s progress in building human capital, including the improvements in health, survival rates, school enrollment, and reduced stunting.
  • The economic impact of the pandemic has been particularly deep for women and for the most disadvantaged families, leaving many vulnerable to food insecurity and poverty.
  • Due to the pandemic’s impact, most children — more than 1 billion — have been out of school and could lose out, on average, half a year of schooling, adjusted for learning, translating into considerable monetary losses.
  • Data also shows significant disruptions to essential health services for women and children, with many children missing out on crucial vaccinations.

India’s performance

  • India’s score increased to 0.49 from 0.44 in 2018, as per the Human Capital Index report released by the World Bank.
  • Last year, India had raised “serious reservations” over the Human Capital Index, wherein India was ranked 115 out of 157 countries.
  • This year India finds itself at 116th from among 174 countries

Human Capital Index (HCI)

  • The HCI has been constructed for 157 countries.
  • It claims to seek to measure the amount of human capital that a child born today can expect to attain by age 18.
  • The HCI has three components:
    • Survival: as measured by under-5 mortality rates
    • Expected years of Quality-Adjusted School: which combines information on the quantity and quality of education
    • Health environment: Using two proxies of (a) adult survival rates and (b) the rate of stunting for children under age 5.

Human Capital Project

  • As part of this World Development Report (WDR), the World Bank has launched a Human Capital Project (HCP).
  • The HCP programme is claimed to be a program of advocacy, measurement, and analytical work to raise awareness and increase demand for interventions to build human capital.
  • There are three components of HCP:
    • a cross-country human capital measurement metric called the Human Capital Index (HCI),
    • a programme of measurement and research to inform policy action
    • a programme of support for country strategies to accelerate investment in human capital.

Other Important Reports Published by World Bank:

  • Global Economic Prospects
  • Ease of Doing Business
  • World Development Report

 

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Source: The Hindu
Tags: News PaperPrelims

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