Economic growth and social development

The recent exchange between two eminent Indian economists has been narrowly portrayed as a debate on which model to follow - one that focusses on market induced “economic growth” or one that stresses state spending and state-led policies to improve social indicators. In order to stir up frenzy, the media has not only portrayed the views of Bhagwati and Sen rather narrowly and unfairly and has exaggerated the distance between their views, but there are some wider issues on measurement that have been glossed over in the various commentaries. While Sen has been forced to stress that he is not anti-growth, and sees the importance of growth in securing economic advancement of the poor, Bhagwati has been at pains to stress that he is not talking of growth as a panacea and is not advocating the trickle down process whereby growth will automatically lead to improvement in social indicators. More absurdly, the debate has turned to the question: which state in India is a “model performer” – Gujarat, Kerala or Tamil Nadu? I pose the “model performer” question in the wider regional context: is it Western India with its faster rate of economic growth and economic affluence, or Southern India with its generally superior performance on social indicators? I draw on my recent research with others to argue here that the answer is neither. One positive externality of the Bhagwati-Sen debate is the attention it draws to the spatial dimension of India’s economic development and the limitation of exercises such as the International Comparison Project (ICP) that treats large countries such as India and Brazil as single entities.

Money metric measures versus social indicators of development

The wider issue that the debate raises is this: should one exclusively use money metric measures, such as income or expenditure, or social indicators based measures to assess progress? Even within a money metric measure such as expenditure, should we use total expenditure or should one narrow it down to only food expenditure? Fortunately, India is blessed with an abundance of data or, more precisely, data from the National Sample Survey (NSS) that concentrates on money metric measures and National Family Health Surveys (NFHS) that provide information on social indicators, to provide evidence on this issue. Do the NSS and NFHS always portray the same picture on the progress of the various states/ regions in the reforms and post reforms period? The answer again is no.

Majumder, Ray and Sinha (2012) have recently presented welfare rankings of states in India based on their per capita food expenditure, corrected for inequality in food expenditure in the respective states, using NSS data from rounds 50 (1993-1994), 55 (1999-2000), 61 (2004-2005) and 66 (2009-2010). The rankings are based on pair-wise comparisons, between states, of food expenditures evaluated at each other’s food prices using a methodology proposed by Sen in his 1976 paper in the Review of Economic Studies. The ranking of states does not always accord with conventional wisdom. In the rural areas, for example, Kerala and UP were right at the top at the start (NSS round 50 in 1993-1994), and even dominated Gujarat, but both these states slipped down the ladder during the period between NSS rounds 50 and 66 (2009-2010). The picture in the urban areas was quite similar. Urban West Bengal, generally regarded as a laggard state, was ranked much higher than perceived. Even within the expenditure based approach, the use of food rather than total expenditure, along with correction for inequality, makes quite a difference. The common perception that the affluent Western region is way ahead and the poorer Eastern region is way behind does not hold even on expenditure based figures.

Figures 1 (stunting and wasting rates) and 2 (neo-natal, infant and child mortality rates) present evidence on movement in social indicators by regions between NFHS-2 (1998-1999) and NFHS-3 (2005-2006). West Bengal is shown separately, in addition to being included in the graphs for the Eastern region, since this state had an uninterrupted Left rule and had quite a unique experience. Once again, the picture does not always accord with perception. For example, the West does worse than the South on both sets of child malnourishment rates (Figure 1). More significantly, West Bengal, notwithstanding the adverse media publicity it has received, does not do all that worse than the West. The South clearly dominates on both stunting and wasting. Note also that the picture is asymmetric between stunting and wasting - in most regions stunting has improved but wasting has deteriorated, except in the West where there has been an improvement in wasting as well. Figure 2 presents a similar picture on mortality rates. The affluent Western region with higher growth rates performs worse than the South and, more significantly, not all that better than the much maligned West Bengal. While any country-wide generalisation is fraught with danger, the one statement that holds for the entire country is that malnourishment and high mortality rates still prevail at uncomfortably high levels.

Multidimensional measures of poverty

This brings me to the issue of the role of economic growth in reducing poverty. Figure 3 shows the state-level relation between multi-dimensional poverty, as measured by the Alkire and Foster (2011) measure, and per capita monthly expenditure. The top part of the figure shows the relationship using a liberal all-encompassing measure of deprivation, while the bottom part focusses on the most deprived households. Each half of Figure 3 shows the relationship for the non-health dimensions in the NSS, and also with the health dimensions added as in the NFHS. Both these figures point to the fact that with rising affluence that accompanies economic growth, multi-dimensional poverty based on a wide set of dimensions does decline. But the graphs also reveal a couple of interesting facts: (a) the graphs come down at a decreasing rate depicting decreasing returns to growth as far as social indictors are concerned, (b) there comes a point when the graphs plateau completely, and state intervention is required to achieve further progress, and (c) the NFHS based graphs lie uniformly above the NSS based graphs which suggest that the inclusion of health deprivation does lead to a bleaker picture on poverty. The graphs also suggest that the understatement of poverty or deprivation due to the omission of the health indicators in the NSS is particularly large for households in the more impoverished states.

Concluding thoughts

The point of this column is not to argue whether growth is important or not, or to claim that there is no divergence between the views of Bhagwati and Sen. Of course, growth is important and, of course, Bhagwati and Sen have sharply divergent views. Bhagwati argues that growth, along with less state controls, will yield improvement in social indicators while Sen argues that improvement in social indicators enhance capabilities and that will lead to growth. In adopting this ‘presidential’ style of debate, the media has trivialised the issue to the naive question of which is more important - economic growth, measured by money metric indicators or progress on quality of life, as measured by social indicators? A question posed in such terms fails to distinguish between an instrument such as economic growth, and outcomes such as superior health and education that are ends in themselves. One does not need to ask the question, where do superior health and education lead to, that one has to ask of economic growth. This column has shown that Western India that is regarded as the fastest growing region in India does not have a vastly superior performance on several social and demographic indicators. The translation of high growth rates and superior statistics on money metric measures to superior figures on social indicators is not all that clear cut. More generally, the link between perception, money metric measures and quality of life indicators is not as transparent as is commonly believed. Quite significantly, West Bengal that has attracted considerable adverse media scrutiny does not do that badly in relation to the all India averages on health indicators, though it does not do all that well either.

Social movement and its characteristics and types .

Social movement, loosely organized but sustained campaign in support of a social goal, typically either the implementation or the prevention of a change in society’s structure or values. Although social movements differ in size, they are all essentially collective. That is, they result from the more or less spontaneous coming together of people whose relationships are not defined by rules and procedures but who merely share a common outlook on society.

Collective behaviour in crowds, panics, and elementary forms (milling, etc.) are of brief duration or episodic and are guided largely by impulse. When short-lived impulses give way to long-term aims, and when sustained association takes the place of situational groupings of people, the result is a social movement.

Characteristics of social movements

A movement is not merely a perpetuated crowd, since a crowd does not possess organizational and motivational mechanisms capable of sustaining membership through periods of inaction and waiting. Furthermore, crowd mechanisms cannot be used to achieve communication and coordination of activity over a wide area, such as a nation or continent. A movement is a mixture of organization and spontaneity. There is usually one or more organizations that give identity, leadership, and coordination to the movement, but the boundaries of the movement are never coterminous with the organizations. For example, although organizations such as California’s Sierra Club are influential in the movement to preserve the natural environment, anyone who works for the cause and interacts with other workers for this purpose is a member of the conservationist movement. The famous John Brown was not a member of any major abolitionist organization, but his martyrdom made him a leader and symbol for the movement, even though organizational leaders were reluctant to recognize him.

Social movements and social change

All definitions of social movement reflect the notion that social movements are intrinsically related to social change. They do not encompass the activities of people as members of stable social groups with established, unquestioned structures, norms, and values. The behaviour of members of social movements does not reflect the assumption that the social order will continue essentially as it is. It reflects, instead, the faith that people collectively can bring about or prevent social change if they will dedicate themselves to the pursuit of a goal. Uncommitted observers may regard these goals as illusions, but to the members they are hopes that are quite capable of realization. Asked about his activities, the member of a social movement would not reply, “I do this because it has always been done” or “It’s just the custom.” He is aware that his behaviour is influenced by the goal of the movement: to bring about a change in the way things have “always” been done or sometimes to prevent such a change from coming about.

Types of social movements

There is no single, standard typology of social movements. As various scholars focus on different aspects of movements, different schemes of classification emerge. Hence any social movement may be described in terms of several dimensions.

Many attempts at categorization direct attention to the objective of the movement. The social institution in or through which social change is to be brought about provides one basis for categorizing social movements as political, religious, economic, educational, and the like. It may be argued that all movements tend to be either political or religious in character, depending upon whether their strategy aims at changing political structures or the moral values of individuals.

A commonly used but highly subjective distinction is that between “reform” and “revolutionary” movements. Such a distinction implies that a reform movement advocates a change that will preserve the existing values but will provide improved means of implementing them. The revolutionary movement, on the other hand, is regarded as advocating replacement of existing values. Almost invariably, however, the members of a so-called revolutionary movement insist that it is they who cherish the true values of the society and that it is the opponents who define the movement as revolutionary and subversive of basic, traditional values.

Some attempts to characterize movements involve the direction and the rate of change advocated. Adjectives such as radical, reactionary, moderate, liberal, and conservative are often used for such purposes. In this context the designations “revolutionary” and “reform” are often employed in a somewhat different sense than that described above, with the implication that a revolutionary movement advocates rapid, precipitous change while a reform movement works for slow, evolutionary change.

Killian advances still another typology based on the direction of the change advocated or opposed. A reactionary movement advocates the restoration of a previous state of social affairs, while a progressive movement argues for a new social arrangement. A conservative movement opposes the changes proposed by other movements, or those seeming to develop through cultural drift, and advocates preservation of existing values and norms.

Turner and Killian argue that it is useful at times to categorize social movements on the basis of their public definition, the character of the opposition evoked, and the means of action available to the movement. This scheme is designed to eliminate the subjective evaluation of goals inherent in such categories as reform and revolutionary. A movement that does not appear to threaten the values or interests of any significant segment of society is publicly defined as respectable. If there is no competing movement advocating the same objective, it is also nonfactional. The respectable nonfactional movement must contend primarily with the problems of disinterest and token support, but it has access to legitimate means of promoting its values. A respectable factional movement must contend with competing movements advocating the same general objective but also has access to legitimate means of extending its influence. A movement that appears to threaten the values of powerful and significant interest groups within the society is publicly defined as revolutionary and encounters violent suppression. As a result, it is denied access to legitimate means of promoting its program. Another type of movement is defined as neither respectable nor dangerous but as peculiar; this type, seen as odd but harmless, encounters ridicule and has limited access to legitimate means.

Social movements may also be categorized on the basis of the general character of their strategy and tactics; for instance, whether they are legitimate or underground. The popular distinction between radical and moderate movements reflects this sort of categorization. An obvious difference between types of movements depends upon their reliance on violent or nonviolent tactics. But a nonviolent movement may also be defined as revolutionary or radical because it accepts civil disobedience, rather than legal or parliamentary maneuvering, as a major feature of its strategy. It should be added that the distinction between violent and nonviolent movements is a relative one because a movement may shift rapidly from one to the other as it develops.

Role of village and cottage industries in rural development

The handicrafts, small scale and medium scale industries manufacturing play a dominant role in programmes for rural development. The promotion of these industries leads to an improvement in social and economic conditions; and an overall balance of rural and urban industrial activities, which in turn, retards migration of labour from rural to urban areas. Socioeconomic improvement in the rural set up is crucial which need improvement in the allied sectoral activities. There is need to have backward and forward linkages of agriculture with industry which is a necessary and sufficient condition for attaining rapid and sustainable growth of primary sector. Encouragement of indigenous entrepreneurship by way of a relatively large participation of individuals in the management and operation of small establishments, thereby improving productivity through personal efforts to raise operational funds and the effective use of such capital to provide marketable finished products are most crucial for making headway in this direction. Since the manufacturing establishments at craftsmanship level are of traditional types, the identification of these traditional skills and the injection of capital, modern machinery equipment, and improved technical training and marketing activities can improve the overall preferences of these units and thus pave the way for greater industrial development in the rural areas. increase of employment and eradication of poverty by creating more units in the handicrafts and small scale sections will be the sure outcome. Infrastructure facilities and capital outlay are relatively smaller in these sections, compared with large establishments. A rational approach would be to encourage the growth of industries in rural areas with a planned dispersal and decentralization programme. Dispersal would improve rural working conditions through the extension of roads, housing electricity, water supply and other amenities of modern industrial life. Diversification of products and establishment of new product lines are another elements which are to be looked into. As there is greater flexibility in the locational and operational requirements of handicrafts and small scale industries, they are more suitable for bringing diversification in both Agriculture and Industries or adding new product lines which need special attention. Import substitution and an increase in subcontracting by such industries means that off-arm activities can be created with less investment and increased production. This type of ancillary development provides overall industrial stability. Further, greater utilization of rural resources and capital formation proves as means of giving impetus of this sectoral activities. Greater utilization of resources is possible only by the creation of more rural handicrafts and small scale industries make full use of all available resources with minimum wastage, resulting in greater saving and capital formation. There already exist great potential for mobilisation of local resources which need dispassionate strategy to be evolved. The fact is that despite the need for rural industrial development certain limitations on the expansion of handicrafts and small scale industries in rural areas exists. As emphasised in the monographs on Appropriate Industrial Technology by UNIDO, the lack of timely credit facilities, difficulty in acquiring machinery and raw materials; lack of appropriate products design, shortage of suitable factory premises and location, lack of technological and managerial know-how, trained manpower; marketing facilities and quality standards. in-adequacy of each constraint creates special difficulties for small enterprise. An integrated development programme providing technological and institutional facilities is needed to form a system of links at the rural industrial level. The problem of sickness of small scale industries specially relating agro-industries need special strategy to be evolved to come over the tense situation. According to the latest estimates small scale units are reported to be in bad shape. The number of sick industries is increasing year after year and the malady if not checked might erode the roots and industrialisation which is a vital component of the economy of the country. A number of reason could be attributed for the sickness of small scale industries in the country and prominent among them are:- a) Management deficiency; b) Inadequate and timely availability of finance; c) Out-dated technology; and d) Marketing problem. e) Inadequate availability of inputs

COTTAGE INDUSTRIES AND THEIR IMPORTANCE

Cottage industries occupy an important place in the economy of India. India is a predominantly agricultural country. About eighty per cent of our country’s population depends on agriculture. In India agriculture can be termed the largest and the most important industry. Agriculture is a seasonal industry which does not provide any work to the agriculturists for about three to four months in a year. The women and the old are without any useful employment almost throughout the year. Cottage industries can provide them some gainful employment and add to their income. They can increase the total production in the country as well.
This is the age of machines. Mechanisation is the order of the day all over the world. But in’an underdeveloped and agricul­tural country like India, the importance of cottage industries cannot be over-emphasised. Even Mahatma Gandhi strongly recommended the development and expansion of cottage industries in India. He said, “I can have no consideration for machinery which is meant to enrich the few at the expense of many.” According to him, “Mechanisation is good when the hands are too few for the work intended to be accomplished. It is an evil when there are more hands than required for work as is the case in India • The problem is how to utilise the idle hours of teeming million inhabitants of our villages which are equal to the working days of six months in a year.”

Cottage industries are of special importance because they can be carried on with the help of the members of the family. They do not require large premises, huge machines and great investment. They are labour intensive. The greatest advantage of such industries is that even the women and the old in the family can usefully utilise their leisure. They not only increase the income of the family but also reduce unemployment and thus raise the standard of living of the members of the family. In olden times, India had fairly deve­loped cottage industries. The commodities produced in these industries were famous for their beauty, art and delicacy. Every village in India was a centre of these industries. But during the British rule these industries received no protection, what to talk of encouragement, and so they were ousted by large industries. After the attainment of independence our national government has paid sufficient attention to the development of these industries.
The problem of unemployment has assumed dangerous pro-tion in India. Eminent economists have expressed the view that present problem of unemployment can be solved by cottage iustries alone and not by large scale industries. India’s Five Year ins have, therefore, laid stress on the development of these indus-and the government of India have constituted more than half-Jozen boards to help their development. Cottage industries have I great potential to solve the problem of unemployment and also to blip in the equitable distribution of wealth. There is no denying the fact that big industries increase the level of production but a Riejor part of the profit goes into the pockets of big industrialists, Wiulting in wide disparity in the distribution of wealth of the nation. The cottage industries prevent the evils of concentration Of industries. Big industries can be located only in certain parts of the country where the necessary infrastructure already exists, whereas Cottage industries can be carried on in every village. Big industries, tend to create regional imbalance : on the other hand cottage Industries reduce regional imbalance in the field of economic acti­vities.
Cottage industries in India are faced with a number of diffi­culties. Our village artisans are mostly illiterate and poor. They have been employing traditional methods and techniques of produc­tion. But of late they have taken to new and improved methods as a result of expansion of education and awareness among them. Government is also helping them by extending training facilities. Shortage of raw materials and difficulty in marketing the finished goods at reasonable prices, are other two great obstacles in the development of cottage industries This results in hardships and exploitation of the artisans. The raw material becomes costlier in remote villages and absence of marketing organisation results in disincentive to greater production. These apart, lack of improved equipment, shortage of power supply, ignorance of new designs are other handicaps suffered by the artisans of these industries. And lastly, lack of finances poses a great problem to those engaged in these industries.
Concerted efforts are being made by our government for the development and expansion of these industries and some improve­ment has been recorded in the matter. The schemes of rural electrification are being implemented to make power available to these industries. Cooperative marketing societies are being orga­nised to help these industries in procurement of raw materials and sale of their product at a reasonable price. New roads constructed in the rural areas have provided transport facilities to them. Government are exploring foreign markets for the goods produced by these industries. Arrangements for credit facilities on nominal interest have been made for them. In the purchase of government supplies, priority is given to these industries. The government is, thus, making serious efforts to encourage and develop them.
The Union ‘Government has set up Khadi and Village Indus-tries Commission to help these industries. Village industries include processing of cereals and pulses, oil, gur and khandsari, palm gur, non-edible oils and soap, bee keeping, handmade paper, village pottery, carpentry, and black-smithy. These industries depend on local raw materials and mainly cater to the requirements of the local population. The Khadi and Village Industries Commission, which is responsible for the development of these industries, provides financial assistance to the registered institutional cooperative societies, State Khadi and Village Industries Board and other village industries which come under its purview. The strategy of economic development evolved by the Planning Commission recognises the need for cottage industries. An important role has been assigned to khadi and cottage industries. In fact it can be said that economic development in our country cannot reach a take-off stage until the vicious circle of poverty is broken by creating avenues of employ­ment for 80 per cent of our population in the rural sector, whose only hope is cottage industry.
In the Industrial Policy Statement made in Parliament in December 1977, it was made clear that Government would introduce legislative measure to ensure adequate recognition to cottage indus­tries, which are capable of providing employment to a large number of persons in the rural sector. As a result of this shift in the attitude of the government every district will be provided with an agency to look after the needs of cottage industries in the district. This district agency would arrange for machinery, raw material, credit facilities, marketing, research and expansion of these indus­tries. The policy statement hoped that the financial institutions would reserve a portion of their total advances for the cottage industries. The government departments and public undertakings have been instructed to make their purchases from these industries on a priority basis. Government would take effective measures for development and greater use of small and simple equipment and machinery suitable for those employed in cottage industries with a view to increasing their productivity and profitability.
During the first three Five Year Plans a sum of Rs. 458.76 crores was spent by government for the development of village and small scale industries. The Fifth Plan outlay for the development of this sector was Rs. 535.03 crores. The Sixth Plan provides an outlay of Rs. 935.00 crores for cottage and small scale industries. It is estimated that khadi and village industries, and small scale indus- ‘ tries would be producing goods worth Rs. 2561 crores and Rs. 2670 crores during 1982-88 they are likely to give employment to 74.48 lakh and 57.68 lakh persons respectively.
Having fixed the objectives of removal of poverty and un­employment, the economic growth of the rural areas is one of the most important measures for achieving it. Development of cottage industries is vital for the real transformation of our countryside.

Gandhian approach to development

The Model of Development

• Increase wealth of nation through Planned growth in agriculture and industry--emphasis on centralized technologies
• The wealth would trickle down to masses thus alleviating poverty
• Help to village industries only a stop gap arrangement for ‘quick employment generation’ .

India’s Development Experience
ITEM                                       YEAR1950                                 YEAR 1998
Food grains                               50.8 mt                                         203.5 mt
 Sugar                                         1.134 mt                                      15.520 mt
Steel                                           1.041 mt                                      373.1 mt
Cotton                                        4215 m sqm                                 17948 m sqm
Electricity gen                            6.575 b kWhr                              448.6 b kWhr
Bicycles                                      99 k                                             10373k
GDP crores                                  1,40,477                                    10,83,047

Gandhiji’s Critique of “Industrialism” based Development
• Crossing river on the basis of average depth ! – Need for equity
• Based on Exploitation- of Man, Nature – Need for non violence , concept of ahimsa
• Unhealthy dependence & vulnerability – Need for self sufficiency in basic necessities , concept of swadeshi
• Unnecessary mechanization – Need for appropriate technology –less capital requirement , more employment , meaningful jobs
• Pampers baser instincts – Self control is a virtue , concept of swaraj

Gandhian Model of Development
• Development should be holistic { economical , intellectual, emotional & spiritual} & Nonexploitative, i.e. sustainable
• Possible only in “Self sufficient Village Republics ” : Gram-swaraj & Swadeshi
• Gandhiji: I do visualise electricity, ship building, iron works, machine making and the like existing side by side with village handicrafts. But the order of dependence will be reversed…..
• The mantra : rural industrialization -wealth generation in a distributed manner & not redistribution of wealth generated centrally – the need for S ,T & M inputs

Alternative Criteria for Technology Choice
Maximise employment
• minimise resource depletion
• Reduce vulnerability- promote self sufficiency
• reduce inequity
• promote job satisfaction
• shouldn’t pamper baser instincts – not thwart satisfaction of higher needs

Various Indicators of Sustainable Development

Introduction

The word for indicator in Arabic is pointer. Indicators point to a desirable outcome, to 'which way is up' in the policy arena.
Classic indicators include the unemployment rate or GDP growth, numbers which are such powerful and recognizable indicators of performance that they may cause governments to fall. At the highest level are indices, such as the consumer price index or human development index, which combine different indicators into a single number useful for comparison over time and space.

Measuring and monitoring environmental conditions has been a major concern of Governments and international organisations during the 1990's. Some of the main international initiatives have included the activities of UNSTAT/UNEP, including the the State of the World Environment and Environmental Data Report series (1994), the development of an Earthwatch database and the beginnings of the development of a series of environmental indicators. Other bodies such as OECD and WHO have been involved in the development of a conceptual framework.

Recently Developed Indicators

Growing realization of the failings of the conventional GNP and income as the primary indicators of economic progress has led to the development of alternative yardsticks. Two interesting recent efforts are the Human Development Index (HDI) devised by the United Nations Development Programme and the Index of Sustainable Economic Welfare (ISEW) developed by economist Herman Daly and theologian John Cobb. A third indicator, per capita grain consumption, is a useful measure of changes in well-being in low-income countries, where the data needed to calculate the more sophisticated indices are typically not available on an annual basis.

The Human Development Index, measured on a scale of 0 to 1, is an aggregate of three indicators: longevity, knowledge, and the command over resources needed for a decent life. For longevity, the UN team uses life expectancy at birth. For knowledge, they use adult literacy and mean years of schooling. And for the command over resources, they use gross domestic product (GDP) per person after adjusting it for purchasing power. Because these indicators are national averages, they do not deal directly with inequalities in wealth distribution, but by including longevity and literacy they do reflect indirectly the distribution of resources. A high average life expectancy, for example, indicates broad access to health care and adequate supplies of food and safe drinking water.

A comparison of countries ranked by both per capita gross domestic product (adjusted for purchasing power) and HDI reveals some wide disparities. Costa Rica ranks 40th in the HDI, while South Africa, with an adjusted per capita GDP 27 percent higher than Costa Rica's, comes in at number 57. Despite their lower average purchasing power, Costa Ricans boast an adult literacy rate of 92 percent, compared with only 85 percent in South Africa, and at birth can expect to live 13 years longer than a newly born South African. Argentina, Chile, Poland, and Yugoslavia are among the other countries exhibiting high human development with comparatively modest per capita income.

The HDI is still evolving; indeed, the country rankings published in 1991 differ markedly in some cases from those in 1990, the first year of the index, because of refinements made by the UN team. As more data become available, the HDI will begin to capture other determinants of human development as well. For example, enough information already exists in 30 countries to include sex inequalities in the HDI. When this is done, top-ranked Japan drops to number 17, while Finland, where women have rights and economic opportunities comparable to men's, moves up from 13 to number 1. Similarly, an HDI sensitive to the distribution of income has been calculated for 53 countries that could provide the needed data; again, the rankings change when this important factor is included.

While the HDI represents a distinct improvement over income figures as a measure of human well-being, it so far says nothing about environmental degradation. As a result, the HDI can rise through gains in literacy, life expectancy, or purchasing power that are financed by the depletion of natural resources, setting the stage for a longer term deterioration in living conditions.

The Daly-Cobb Index of Sustainable Economic Welfare, on the other hand, is a more comprehensive indicator of well-being, taking into account not only average consumption but also distribution and environmental degradation. To date, it has only been calculated for the United States. After adjusting the consumption component of the index for distributional inequality, the authors factor in several environmental measures, such as depletion of nonrenewable resources, loss of farmland from soil erosion and urbanisation, loss of wetlands, and the cost of air and water pollution. They also incorporate what they call "long-term environmental damage", a figure that attempts to take into account such large-scale changes as the effects of global warming and of damage to the ozone layer.

Applying this comprehensive measure shows a rise in welfare per person in the United States of some 42 percent between 1950 and 1976. But after that the ISEW began to decline, falling by just over 12 percent by 1988, the last year for which it was calculated. Simply put, about 15 years ago the net benefits associated with economic growth in the United States fell below the growth of population, leading to a decline in individual welfare.

The principal weakness of the ISEW is its dependence on information that is available in only a handful of nations. For example, few developing countries have comprehensive data on the extent of air and water pollution, not to mention measurements of year-to-year changes. The same drawback applies to the HDI, since life expectancy data depend heavily on infant mortality information that, astonishing as it may seem, is collected at best once a decade in most of the Third World.

Per capita grain consumption, however, is a useful measure of well-being in low-income countries that can be tracked on a yearly basis. This indicator captures the satisfaction of a basic human need, since people cannot survive if annual grain consumption falls much below 180 kilograms (about 1 pound a day) for an extended period. It is also less vulnerable to distortion by inequities of income and wealth. While the distribution of wealth between the richest and poorest one fifth of a population can be as great as 20 to 1, as indeed it is in Algeria, Brazil, and Mexico, per capita consumption of grain by these same groups will not vary by more than 4 to 1.

One drawback with this indicator is that it says nothing about how much of the grain consumed was produced unsustainably - by eroding soils, depleting water supplies, and the like. Another is that at some point, higher per capita grain consumption starts to imply a deterioration in human well-being rather than an improvement. Toward the top end of the scale people are consuming fat-rich livestock products known to increase heart disease and colon, breast, and other types of cancer, leading to an overall reduction in life expectancy. Per capita grain consumption is therefore best used as an indicator of well-being only in poorer countries.

Indicators for Sustainable Development

An increasing number of organisations has responded to the challenge of Agenda 21 to develop indicators for sustainable development in the short-term. Some of this work is being undertaken around specific issues, such as health and the environment, or human settlements; others are attempting to define a full set of indicators. Such redundancy and overlap has been extremely valuable, since it has generated more creative thinking and a shared sense of purpose. The role of the Department for Policy Coordination and Sustainable development, as Task Manager of this issue, is now to coordinate the fruits of this work, to underline areas of convergence, and to bring together the many actors in a broad, cooperative programme that may directly serve the needs of the Commission on Sustainable Development, as well as all Member States. Much further work, primarily by the scientific community, is needed in order to understand and explicate these interlinkages.

Economic indicators have ben used for many years at national, regional and international levels. Social indicators have also been developed over the past years and are widely used all over the world. It is feasible to select among the economic and social indicators those which capture the specific issues most relevant to sustainable development. Institutional indicators related to Agenda 21 or sustainable development are largely undeveloped and are at this stage limited to so-called yes/no indicators. Environmental indicators have been developed more recently. For some of the environmental aspects, data will not be easily available. Recent initiatives include the environment statistics programme of the United Nations Statistical Commission, environmental indicators being developed by UNEP, the UN system-wide Earthwatch, the OECD, various relevant international legal instruments, and so forth.

Based on relevant indicators that are available, it is proposed that the Commission on Sustainable Development agree that work will proceed on the basis of a core set of indicators, as contained in Table 1 (see Indicator Template on main menu), with the understanding that this is a flexible, working set of indicators that will be fine-tuned to the needs of countries after further methodological work, testing and training. It is further proposed that the Commission approve the work programme on indicators for sustainable development, including the following elements: (1) preparation of methodology sheets for distribution to governments; (2) testing of the indicators, on a voluntary basis, in three to four countries and their subsequent adaptation, as needed; (3) organisation of national and regional training workshops and other capacity-building activities, upon request; and (4) evaluation and readjustment of the indicators on the basis of experience and further research as national and international levels, including in the context of international legal instruments.

It is also proposed that the Commission of Sustainable Development encourage continued cooperation with the work underway on environment indicators under the auspices of the United Nations Statistical Commission.

Highly Aggregated Indicators

Concurrently, work may proceed with developing highly aggregated indicators for sustainable development. Although this represents a longer-term effort, it is important for three reasons: it explores the relationship among the variable, which lies at the heart of the linkages intrinsic to sustainable development; it concentrates information collection and analysis and facilitates presentation to decision-makers; and, it may serve as the basis of an early warning systems, if desired.

A project is now being undertaken by the Scientific Committee on Problems of the Environment (SCOPE), in cooperation with UNEP, aiming at developing highly aggregated indicators for sustainable development. This initiative is currently focusing on the environmental aspects of sustainability although the project could be broadened to focus on other aspects of sustainable development, as well.

Core Set of Indicators for Sustainable Development:

A core set of indicators, as contained in Table 1 (see Indicator Template on main menu) is proposed for monitoring progress at a national level towards sustainable development through the implementation of Agenda 21. It is fully recognised that there is need for flexibility as the conditions, activities and priorities for sustainable development differ from country to country. At same time, the need for international comparability calls for the development of standardised concepts, definitions and classifications of indicators.

As mentioned, regional workshops and capacity-building programmes are needed in order to facilitate the use of the core set of indicators at a national level. Testing of the indicators in three to four countries could be used to gain experience and further develop the indicators, and evaluation of the use of the indicators at the national level, and national and international developments, could be used to adjust the core set of indicators if necessary.

The indicators in the core set are presented in a Driving Force - State - Response (DSR) framework. The DSR framework is adopted from the widely agreed framework for environmental indicators, the Pressure - State - Response framework. The concept of "pressure" has been replaced by that of "Driving Forces", in order to accommodate more accurately the addition of economic, social and institutional indicators. "Driving force" indicators indicate human activities, processes and patterns that impact on sustainable development, "state" indicators indicate the "state" of sustainable development and "response" indicators indicate policy options and other responses to the changes in the "state" of sustainable development.

In the core set, the indicators are grouped in categories covering the economic, social, institutional and environmental aspects of sustainable development. The indicators are related to chapters of Agenda 21. The coverage of the four aspects of sustainable development and of all the chapters of Agenda 21 ensures that the most significant aspects of sustainable development are monitored by the indicators.

The indicators in the proposed framework have been developed in accordance with the following criteria:

(a) primarily national in scale or scope (countries may also wish to use indicators at state and provincial levels);

(b) relevant to the main objective of assessing progress towards sustainable development;

(c) understandable in that they are clear, simple, and unambiguous;

(d) realizable within the capacities of national governments, given their logistic, time, technical and other constraints;

(e) conceptually well founded;

(f) limited in number, remaining open-ended and adaptable to future developments;

(g) broad in coverage of Agenda 21 and all aspects of sustainable development;

(h) representative of an international consensus, to the extent possible; and

(i) dependent on data which are readily available or available at reasonable cost/benefit ratio, adequately documented, of known quality and updated at regular intervals.


As noted, the core set of indicators may change and new indicators may be included, for example, in the context of international legal agreements, or as national level experience is gained. Furthermore, there are some potentially important indicators which require further methodological work before they can be used. This is especially the case for various ecosystem (geo-referenced) indicators, including biodiversity and other habitat indicators, and for the following issues, for which indicators are not included in the core set at this stage:

- transfer of technology (driving force, state and response indicators);
- science (driving force, state and response indicators);
- capacity-building (driving force, state and response indicators);
- decision-making structures (driving force indicators);
- strengthening of "traditional information" (driving force and response indicators);
- role of major groups (driving force and response indicators);
- oceans, all kinds of seas and coastal areas (response indicators);
- desertification and drought (response indicators);
- sustainable mountain development (driving force, state and response indicators);
- biotechnology (driving force, state and response indicators); and,
- toxic chemicals and hazardous wastes (response indicators).

Research and experimentation with advanced economic, social and institutional indicators that might more effectively measure progress toward sustainable development and continued research and experimentation with environmental indicators appropriate for measuring progress toward sustainable development should be endorsed. There may also be need for subsets and other, often more comprehensive, sets of indicators for other purposes.

Environmental Indicators

The pressure-state-response framework, follows a cause-effect-social response logic. It was developed by the OECD from earlier work by the Canadian government. Increasingly widely accepted and internationally adaopted, it can be applied at a national level, at sectoral levels, at the levels of an industrial firm, or at the community level.

Pressure indicators measure policy effectiveness more directly -- whether emissions increase or decrease, whether forest depletion waxes or wanes, and whwether human exposure to hazardous conditions grows or shrinks. Accountability for the pressures each country exerts on the environment is claer -- as in the case of the amount of ozone-degrading gases emitted. These indicators are not only descriptive. They can also provide direct feedback on whether policies meet stated goals because they are based on measures or model-based estimates of actual behaviour. Pressure indicators are thus particularly useful in formulating policy targets and in evaluating policy performance. They can also be used prospectively to evaluate environmental impacts of socioeconomic scenarios or proposed policy measures.

Response indicators measure progress toward regulatory compliance or other governmental efforts, but don't directly tell what is happening to the environment. As a practical matter, data to construct indicators is usually most available for pressure indicators and sparsest for response indicators.

Core lists of environmental issues -- and of relevant indicators -- have been and are being developed by several organisations, building on the OECD's initial work. Such indicators can be organised within the pressure-state-response framework into a matrix of indicators. 

Jawaharlal Nehru approach to development .

The economic policies of Jawaharlal Nehru have been subject to much controversy in the past few decades. However, it is important to place Nehru's economic policies in context for a proper appreciation of his policies.
Nehru's commitment to the cause of India's development remains unquestioned, and it is no doubt that much of his plans and speculations were jeopardized by the unexpected partition that came along with the independence of India, which brought about an unprecedented fissure in the economic resources of the Indian mainland. Nehru himself confessed that the partition brought about a large share of problems, including a great rift in the agricultural and the industrial sectors. A large portion of the most productive agricultural lands fell in Pakistan whereas the corresponding industries remained in Indian dominion. The problem faced by the Jute industry soon after Independence can be stated as a case in the point. The jute producing areas were in Pakistan whereas the Jute processing factories remained in India, thereby affecting jute productions on both sides of the border. 

Early Economic Reforms of Nehru: Nehru started his career as the Prime Minister of independent India in 1947, and immediately launched a number of economic reforms. Nehru was a firm believer in state control over the economic sectors. His socialist ideals revealed themselves in the way he introduced laws for land redistribution, in order to curtail the economic disparity in India among the landed and the land-less classes. One of Nehru's key economic reforms was the introduction of the Five Years Plan in 1951. It was introduce to determine the mode of government expenditure and grants in important development sectors like agriculture, industries and education. 

The Ideology guiding Nehru's Economic Policies: Nehru's economic policies have often been considered to be Socialist in nature. It is no doubt that Socialism did play a very important role in Nehru's ideological make-up. But at the same time, it is also important to consider that Nehru himself denied any kind of overt Socialist tendencies in the economic policies adopted by him. Nehru advocated a kind of mixed economy. Any kind of unquestioned ideological adherence to any form of economic tenet, or 'ism', he realized, would be detrimental to India's growth. He wanted a practical approach in framing the Indian economy, which would suit best the country's needs. On the one hand, as a devoted Gandhian, he had strong belief in the betterment of rural economy. On the other hand, he had a strong belief that heavy industrial development would be the best way to serve India's economic interests. 

Nehru's Industrial Policies: Nehru wanted to create a balance between the rural and the urban sectors in his economic policies. He stated there was no contradiction between the two and that both could go hand in hand. He denied to carry forward the age old city versus village controversy and hoped that in India, both could go hand in hand. Nehru was intent to harness and fully exploit the natural resources of India for the benefit of his countrymen. The main sector he identified was hydroelectricity, and he constructed a number of dams to achieve that end. The dams would not only harness energy, but would also support irrigation to a great degree. Nehru considered dams to be the very symbol of India's collective growth, as they were the platforms where industrial engineering and agriculture met on a common platform. Nehru also considered the possibility of nuclear growth during his tenure as the prime minister of India. 

Nehru and Foreign Investment: Nehru inspired the industrialists to provide a fillip to India's economy. However, he had strict reservations on the question of foreign investment. Nehru was wary of foreign investment. Nehru's nationalist ideals confirmed in him the belief that India was self-sufficient to bolster her own growth. Although he did not officially decry the possibility of foreign investment in direct terms, he did stress that the sectors of foreign investment would be regularized, and the terms and conditions of investment and employment would be strictly controlled by government rules in case there were possibilities of a foreign investment. Nehru, moreover, emphasized that the key sectors will always be in government hand. This step of Nehru is much criticized now. Yet, it cannot be denied that Nehru aptly looked forward to long term investments for which he banked more on Indian industries. It is also often suggested that his endeavor to harness international support to develop India's infra-structural profile between 1947 and 1955 did not meet with much success. It, however, remains a fact that Nehru's regime was not one of great economic growth for India. Although his economic policies are blamed for the failure of India to turn into a major economic force in the aftermath of independence, yet Nehru was probably thinking on a more long term basis. It is often inferred that the economic liberation of the later years was possible only because of Nehru's policies in the initial stages. 

The State Control in Nehru's Economic Policies: The most distinctive, and often debated feature of Nehru's economic policies, was the high level of state and central control that was exercised on the industrial and business sectors of the country. Nehru emphasized that the state would control almost all key areas of the country's economy, either centrally or on a state-wise basis. His Socialist emphasis on state control somehow seemed to undermine his stress on industrial policies. The rigorous state laws and License rules put a great degree of restrain on the free execution of industrial policies. Even the farmers, along with the business personnel, found themselves to be at the receiving end of rigorous state control policies and high taxation. Poverty and unemployment were widespread throughout Nehru's governance. 

Nehru's Views on Rural Economy: Nehru's policy towards the rural economy of India was also significant. Nehru felt for the rural self-development of India very strongly. He tried to boost India's cottage industries. Much on the lines of Gandhi, Nehru believed that the rural and cottage industries of India played a major role in the economic fabric of the country. But most of his cottage industry development programs were meant as a part of community development. He was also of the belief that small scale industries and cottage industries were effective solutions to the massive employment problems that remained a perpetual issue of concern throughout his tenure. 

The economic policies of Nehru are often blamed for the poor economy of India in the subsequent years. However, it cannot be denied that his decisions were necessitated by the needs of the times. India needed to effectively harness its domestic means as well as strengthen its governmental control to lay the base for future privatization. It is often speculated that Nehru would have embraced the economic reforms and economic liberalization of the late twentieth century if he was alive. 

Millennium Development Goals

The Millennium Development Goals (MDGs) are eight international development goals that were established following the Millennium Summit of the United Nations in 2000, following the adoption of the United Nations Millennium Declaration. All 189 United Nations member states at the time (there are 193 currently), and at least 23 international organizations, committed to help achieve the following Millennium Development Goals by 2015 .

At the Millennium Summit in September 2000 the largest gathering of world leaders in history adopted the UN Millennium Declaration, committing their nations to a new global partnership to reduce extreme poverty and setting out a series of time-bound targets, with a deadline of 2015, that have become known as the Millennium Development Goals.

The Millennium Development Goals (MDGs) are the world's time-bound and quantified targets for addressing extreme poverty in its many dimensions-income poverty, hunger, disease, lack of adequate shelter, and exclusion-while promoting gender equality, education, and environmental sustainability. They are also basic human rights-the rights of each person on the planet to health, education, shelter, and security.

Goal 1: Eradicate Extreme Hunger and Poverty

Target 1. Halve, between 1990 and 2015, the proportion of people whose income is less than $1 a day

Indicators

1. Proportion of population below $1 (1993 PPP) per day (World Bank)

2. Poverty gap ratio [incidence x depth of poverty] (World Bank)

3. Share of poorest quintile in national consumption (World Bank)

Target 2. Halve, between 1990 and 2015, the proportion of people who suffer from hunger

Indicators

4. Prevalence of underweight children under five years of age (UNICEF-WHO)

5. Proportion of population below minimum level of dietary energy consumption (FAO)

Goal 2: Achieve Universal Primary Education

Target 3. Ensure that, by 2015, children everywhere, boys and girls alike, will be able to complete a full course of primary schooling

Indicators

6. Net enrolment ratio in primary education (UNESCO)

7. Proportion of pupils starting grade 1 who reach grade 5 (UNESCO)

8. Literacy rate of 15-24 year-olds (UNESCO)

Goal 3: Promote Gender Equality and Empower Women

Target 4. Eliminate gender disparity in primary and secondary education, preferably by 2005, and in all levels of education no later than 2015

Indicators

9. Ratio of girls to boys in primary, secondary and tertiary education (UNESCO) 

10. Ratio of literate women to men, 15-24 years old (UNESCO)

11. Share of women in wage employment in the non-agricultural sector (ILO) 

12. Proportion of seats held by women in national parliament (IPU)

Goal 4: Reduce Child Mortality

Target 5. Reduce by two-thirds, between 1990 and 2015, the under-five mortality rate

Indicators

13. Under-five mortality rate (UNICEF-WHO)

14. Infant mortality rate (UNICEF-WHO)

15. Proportion of 1 year-old children immunized against measles (UNICEF-WHO)

Goal 5: Improve Maternal Health

Target 6. Reduce by three-quarters, between 1990 and 2015, the maternal mortality ratio

Indicators

16. Maternal mortality ratio (UNICEF-WHO)

17. Proportion of births attended by skilled health personnel (UNICEF-WHO)

Goal 6: Combat HIV/AIDS, Malaria and other diseases

Target 7. Have halted by 2015 and begun to reverse the spread of HIV/AIDS 

Indicators

18. HIV prevalence among pregnant women aged 15-24 years (UNAIDS-WHO-UNICEF) 

19. Condom use rate of the contraceptive prevalence rate (UN Population Division) 

19a. Condom use at last high-risk sex (UNICEF-WHO)

19b. Percentage of population aged 15-24 years with comprehensive correct knowledge of HIV/AIDS (UNICEF-WHO) 

19c. Contraceptive prevalence rate (UN Population Division)

20. Ratio of school attendance of orphans to school attendance of non-orphans aged 10-14 years (UNICEF-UNAIDS-WHO)

Target 8. Have halted by 2015 and begun to reverse the incidence of malaria and other major diseases

Indicators

21. Prevalence and death rates associated with malaria (WHO)

22. Proportion of population in malaria-risk areas using effective malaria prevention and treatment measures (UNICEF-WHO) 

23. Prevalence and death rates associated with tuberculosis (WHO)

24. Proportion of tuberculosis cases detected and cured under DOTS (internationally recommended TB control strategy) (WHO)

Goal 7: Ensure Environmental Sustainability

Target 9. Integrate the principles of sustainable development into country policies and programs and reverse the loss of environmental resources

Indicators

25. Proportion of land area covered by forest (FAO)

26. Ratio of area protected to maintain biological diversity to surface area (UNEP-WCMC)

27. Energy use (kg oil equivalent) per $1 GDP (PPP) (IEA, World Bank)

28. Carbon dioxide emissions per capita (UNFCCC, UNSD) and consumption of ozone-depleting CFCs (ODP tons) (UNEP-Ozone Secretariat)

29. Proportion of population using solid fuels (WHO)

Target 10. Halve, by 2015, the proportion of people without sustainable access to safe drinking water and basic sanitation

Indicators

30. Proportion of population with sustainable access to an improved water source, urban and rural (UNICEF-WHO)

31. Proportion of population with access to improved sanitation, urban and rural (UNICEF-WHO)

Target 11. Have achieved by 2020 a significant improvement in the lives of at least 100 million slum dwellers

Indicators

32. Proportion of households with access to secure tenure (UN-HABITAT)

Goal 8: Develop a Global Partnership for Development

Target 12. Develop further an open, rule-based, predictable, nondiscriminatory trading and financial system (includes a commitment to good governance, development, and poverty reduction?both nationally and internationally)

Target 13. Address the special needs of the Least Developed Countries (includes tariff- and quota-free access for Least Developed Countries? exports, enhanced program of debt relief for heavily indebted poor countries [HIPCs] and cancellation of official bilateral debt, and more generous official development assistance for countries committed to poverty reduction)

Target 14. Address the special needs of landlocked developing countries and small island developing states (through the Program of Action for the Sustainable Development of Small Island Developing States and 22nd General Assembly provisions)

Target 15. Deal comprehensively with the debt problems of developing countries through national and international measures in order to make debt sustainable in the long term

Indicators

Official development assistance (ODA)

33. Net ODA, total and to LDCs, as percentage of OECD/Development Assistance Committee (DAC) donors' gross national income (GNI)(OECD)

34. Proportion of total bilateral, sector-allocable ODA of OECD/DAC donors to basic social services (basic education, primary health care, nutrition, safe water and sanitation) (OECD)

35. Proportion of bilateral ODA of OECD/DAC donors that is untied (OECD)

36. ODA received in landlocked developing countries as a proportion of their GNIs (OECD)

37. ODA received in small island developing States as proportion of their GNIs (OECD)

Market access

38. Proportion of total developed country imports (by value and excluding arms) from developing countries and from LDCs, admitted free of duty (UNCTAD, WTO, WB)

39. Average tariffs imposed by developed countries on agricultural products and textiles and clothing from developing countries (UNCTAD, WTO, WB)

40. Agricultural support estimate for OECD countries as percentage of their GDP (OECD)

41. Proportion of ODA provided to help build trade capacity (OECD, WTO) 

Debt sustainability

42. Total number of countries that have reached their Heavily Indebted Poor Countries Initiative (HIPC) decision points and number that have reached their HIPC completion points (cumulative) (IMF - World Bank) 

43. Debt relief committed under HIPC initiative (IMF-World Bank)

44. Debt service as a percentage of exports of goods and services (IMF-World Bank)

Some of the indicators listed below are monitored separately for the least developed countries, Africa, landlocked developing countries, and small island developing states

Target 16. In cooperation with developing countries, develop and implement strategies for decent and productive work for youth

Indicators

45. Unemployment rate of young people aged 15-24 years, each sex and total (ILO) 

Target 17. In cooperation with pharmaceutical companies, provide access to affordable essential drugs in developing countries

Indicators

46. Proportion of population with access to affordable essential drugs on a sustainable basis (WHO)

Target 18. In cooperation with the private sector, make available the benefits of new technologies, especially information and communications technologie

Indicators

47. Telephone lines and cellular subscribers per 100 population (ITU)

48. Personal computers in use per 100 population and Internet users per 100 population (ITU)