Evaluate the Performance of Pakistan on the Basis of Latest Human Development Index Report

8/8/2019 Evaluate the Performance of Pakistan on the Basis of Latest Human Development Index Report

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Pakistan Economic Policy

Assignment 1

Name: Muhammad Ali Noor

Id:7010

Faculty: Mirza Aqeel Baig

Dated : 24th September 2010


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EVALUATION OF THE PERFORMANCE OF PAKISTAN ON THE BASIS OF LATEST HUMAN

DEVELOPMENT INDEX REPORT AND ITS COMPARISON TO TWO SAARC COUNTRIES (SRILANKA

& BANGLADESH)

Country

Pakistan 141 142 +1

Sri lanka 102 102 0

Bangladesh 146 148 +2

PAKISTAN

Pakistan ranks 141ST in UNDPs Human Development Index (HDI), out of total 178 countries.

According to UNDPs HDI report, Pakistan faces enormous challenges, including poverty, poor

healthcare facilities, illiteracy and a continuously soaring population.

The government released between 11 to 25 percent funds earmarked for environment,

education and health sectors during the first six months of the current fiscal year (July-

December), out of the budgetary allocation, which reflects lack of commitment to these critical

sectors.

According to the World Bank Report 2006, collective estimated environmental degradation

costs the country at least 6 percent of GDP, or about Rs 365 billion per year, and this costs falls

disproportionately upon the poor. Meanwhile, the Ministry of Education received fundsamounting to Rs 2 billion which is 23.3 percent of the total budgetary allocation of Rs 8.551

billion earmarked in 2009-10 for development projects.

The government has also neglected the health sector which received 25.9 percent or Rs 6

billion during the first six months of the current fiscal year against the entire years budgetary

allocation of Rs 23.154 billion.

In spite of Governments tall claims of progress in health sector the people of Pakistan continue

to suffer from various health issues including limited access to health facilities, wide spread

malnutrition, poverty and poor living conditions. The heath development activities contrastsharply in relation to other countries at similar level of development and per capita income and

reflect a backlog of many un-met needs. These concerns are overdue and require urgent

attention.

According to Economic Survey 2008-09, public expenditure on education as a percentage to

GDP is lowest in Pakistan in the South Asian region due to fiscal resource constraints. The trend

of investment on education in terms of GDP has been 2.50% and 2.47 % in the years 2006-07

and 2007-2008 respectively whereas it is estimated at 2.10 % during 2008-09.


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SRILANKA

In 1977, Colombo abandoned statist economic policies and its import substitution trade policy

for more market-oriented policies, export-oriented trade, and encouragement of foreign

investment. Recent changes in government, however, have brought some policy reversals.

Currently, the ruling Sri Lanka Freedom Party has a more statist economic approach, which

seeks to reduce poverty by steering investment to disadvantaged areas, developing small and

medium enterprises, promoting agriculture, and expanding the already enormous civil service.

The government has halted privatizations.

Although suffering a brutal civil war that began in 1983, Sri Lanka saw GDP growth average

4.5% in the last 10 years with the exception of a recession in 2001. In late December 2004, a

major tsunami took about 31,000 lives, left more than 6,300 missing and 443,000 displaced,

and destroyed an estimated $1.5 billion worth of property.

Government spending and reconstruction drove growth to more than 7% in 2006 but reduced

agriculture output probably slowed growth to about 6 percent in 2007. Government spending

and loose monetary policy drove inflation to nearly 16% in 2007. Sri Lanka's most dynamic

sectors now are food processing, textiles and apparel, food and beverages, port construction,

telecommunications, and insurance and banking.

In 2006, plantation crops made up only about 15% of exports (compared with more than 90% in

1970), while textiles and garments accounted for more than 60%. About 800,000 Sri Lankans

work abroad, 90% of them in the Middle East. They send home more than $1 billion a year.

BANGLADESH

The economy has grown 5-6% over the past few years despite inefficient state-owned

enterprises, delays in exploiting natural gas resources, insufficient power supplies, and slow

implementation of economic reforms.

Bangladesh remains a poor, overpopulated, and inefficiently-governed nation. Although more

than half of GDP is generated through the service sector, nearly two-thirds of Bangladeshis are

employed in the agriculture sector, with rice as the single-most-important product. Garment

exports and remittances from Bangladeshis working overseas, mainly in the Middle East andEast Asia, fuel economic growth.


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The Human Development Index

The HDI provides a composite measure of three dimensions of human development: living a

long and healthy life (measured by life expectancy), being educated (measured by adult

literacy and gross enrolment in education) and having a decent standard of living (measured

by purchasing power parity, PPP, income).

The index is not in any sense a comprehensive measure of human development. It does not, for

example, include important indicators such as gender or income inequality nor more difficult to

measure concepts like respect for human rights and political freedoms. What it does provide is

a broadened prism for viewing human progress and the complex relationship between income

and well-being.

Of the components of the HDI, only income and gross enrolment are somewhat responsive to

short term policy changes. For that reason, it is important to examine changes in the human

development index over time.

PAKISTAN

Between 1980 and 2007 Pakistan's HDI rose by 1.30% annually from 0.402 to 0.572. HDI scores

in all regions have increased progressively over the years although all have experienced periods

of slower growth or even reversals.

The HDI for Pakistan is 0.572, which gives the country a rank of 141st out of 182 countries

SRILANKA

Between 1980 and 2007 Sri Lanka's HDI rose by 0.58% annually from 0.649 to 0.759 today. TheHDI for Sri Lanka is 0.759, which gives the country a rank of 102

ndout of 182 countries

BANGLADESH

Between 1980 and 2007 Bangladesh's HDI rose by 1.86% annually from 0.328 to 0.543 today.

The HDI for Bangladesh is 0.543, which gives the country a rank of 146th

out of 182 countries

HDI value Life expectancy at

birth

(years)

Adult literacy

rate

(% ages 15 and

above)

Combined gross

enrolment ratio

(%)

GDP per capita

(PPP US$)

141. Pakistan

(0.572)

117. Pakistan

(66.2)

134. Pakistan

(54.2)

169. Pakistan

(39.3)

132. Pakistan

(2,496)

102. Sri Lanka

(0.759)

59. Sri Lanka

(74.0)

66. Sri Lanka

(90.8)

113. Sri Lanka

(68.7)

116. Sri Lanka

(4,243)

146. Bangladesh

(0.543)

120. Bangladesh

(65.7)

135. Bangladesh

(53.5)

154. Bangladesh

(52.1)

155. Bangladesh

(1,241)


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COMPARISION

Looking at the HDI value it can be seen that srilanka has the highest ranking (102) among

Pakistan (141) and Bangladesh (146) with a value of 0.759 next to it is Pakistan with value of

0.572 and least is Bangladesh with value of 0.543 which is not very different from that of

Pakistan and Pakistan has a slight edge over Bangladesh in HDI value. Despite of a small

difference in the HDI value, ranking gap is of about 5 points between Pakistan and Bangladesh.

When we compare Life expectancy in this case again Srilanka has the highest ranking along with

the maximum age of 74 among the two countries Pakistan and Bangladesh, where as Pakistan

again leads against Bangladesh with age of 66.2 as compared to Bangladeshs 65.7 years.

Comparing the Adult Literacy rate it can be clearly seen that srilanka is far ahead with an

outstanding 90.8 % and it has no competition or comparison with literacy rate of Pakistan and

Bangladesh 54.2% and 53.5% respectively.

GDP per Capita is again showing the same trend of srilanka leading far ahead with GDP perCapita of $4243 which means that srilanka is enjoying a good position as compared to other

two countries Pakistan and Bangladesh with GDP per Capita of $2496 and $1241 respectively.

Human poverty: focusing on the most deprived in multiple dimensions of

poverty

The HDI measures the average progress of a country in human development where as The

Human Poverty Index (HPI-1), focuses on the proportion of people below certain threshold

levels in each of the dimensions of the human development index - living a long and healthy

life, having access to education, and a decent standard of living. By looking beyond income

deprivation, the HPI-1 represents a multi-dimensional alternative to the $1.25 a day (PPP US$)

poverty measure.

The HPI-1 measures severe deprivation in health by the proportion of people who are not

expected to survive to age 40. Education is measured by the adult illiteracy rate. And a decent

standard of living is measured by the unweighted average of people not using an improved

water source and the proportion of children under age 5 who are underweight for their age..

PAKISTAN

The HPI-1 value of 33.4% for Pakistan, ranks 101st

among 135 countries for which the index hasbeen calculated.

SRILANKA

The HPI-1 value of 16.8% for Sri Lanka, ranks 67th among 135 countries for which the index has

been calculated.


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BANGLADESH

The HPI-1 value of 36.1% for Bangladesh, ranks 112th among 135 countries for which the index

has been calculated.

Human Poverty

Index

(HPI-1)

Probability of not

surviving to age

40

(%)

Adult illiteracy

rate

(%ages 15 and

above)

People not using

improved water

source

(%)

Children

underweight for

age

(% aged under 5)

101. Pakistan

(33.4)

97. Pakistan

(12.6)

134. Pakistan

(45.8)

70. Pakistan (10) 125. Pakistan (38)

67. Sri Lanka

(16.8)

47. Sri Lanka

(5.5)

66. Sri Lanka

(9.2)

94. Sri Lanka

(18)

113. Sri Lanka

(29)

112. Bangladesh

(36.1)

95. Bangladesh

(11.6)

135. Bangladesh

(46.5)

97. Bangladesh

(20)

138. Bangladesh

(48)

COMPARISION

Looking at the HPI value it can be seen that Srilanka has the highest ranking (67) among

Pakistan (101) and Bangladesh (112) with an index value of 16.8 next to it is Pakistan with of

33.4 and highest is Bangladesh with 36.1 which clearly shows that Srilanka has the least index in

poverty as compared to Pakistan and Bangladesh where the poverty index is almost double of

Srilanka, showing a better standard of living in Srilanka

When we compare Probability of not surviving to age 40 in this case again Srilanka has the

highest ranking along with the minimum % 5.5 which is very low among the two countries

Pakistan and Bangladesh, where as Bangladesh here leads against Pakistan with %age of 11.6 as

compared to Pakistans %age 12.6 showing a better standard of health and environment in

Srilanka with less pollution.

Comparing the Adult illiteracy rate it can be clearly seen that srilanka is far ahead with an

outstanding 9.2 % illiteracy rate showing its impressive education system and it has no

competition or comparison with illiteracy rate of Pakistan and Bangladesh 45.8% and 46.5%

respectively.

People not using an improved water source in Pakistan (10%) is showing a reverse and artificial

trend as compared to the life expectancy of the people and health of people in Pakistan whichis lower than of both Srilanka and Bangladesh 18 and 20 % respectively as opposed to the

better health and life expectancy in Srilanka.


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Building the capabilities of women

The HDI measures average achievements in a country, but it does not incorporate the degree of

gender imbalance in these achievements. The gender-related development index (GDI),

introduced in Human Development Report 1995, measures achievements in the same

dimensions using the same indicators as the HDI but captures inequalities in achievement

between women and men. It is simply the HDI adjusted downward for gender inequality. The

greater the gender disparity in basic human development, the lower is a country's GDI relative

to its HDI.

PAKISTAN

Pakistan's GDI value, 0.532 should be compared to its HDI value of 0.572. Its GDI value is 93.0%

of its HDI value. Out of the 155 countries with both HDI and GDI values, 152 countries have a

better ratio than Pakistan's.

SRILANKA

Sri Lanka's GDI value, 0.756 should be compared to its HDI value of 0.759. Its GDI value is 99.6%

of its HDI value. Out of the 155 countries with both HDI and GDI values, 35 countries have a

better ratio than Sri Lanka's.

BANGLADESH

Bangladesh's GDI value, 0.536 should be compared to its HDI value of 0.543. Its GDI value is

98.7% of its HDI value. Out of the 155 countries with both HDI and GDI values, 100 countries

have a better ratio than Bangladesh's.

GDI as % ofHDI Life expectancy at

birth

(years)

2004

Adult literacy rate

(% ages 15 and

older)

2004

Combined primary,

secondary and

tertiary gross

enrolment ratio

2004

153. Pakistan

(93.0%)

187. Pakistan

(101.0%)

133. Pakistan (58.6%) 159. Pakistan (78.3%)

36. Sri Lanka

(99.6%)

18. Sri Lanka

(110.9%)

65. Sri Lanka (96.1%) 68. Sri Lanka

(103.6%)

101. Bangladesh(98.7%)





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Remittances

Remittances, which are usually sent to immediate family members who have stayed behind, are

among the most direct benefits from migration; their benefits spread broadly into local

economies. They also serve as foreign exchange earnings for the origin countries of migrants.

However, remittances are unequally distributed. Of the total US$370 billion remitted in 2007,

more than half went to countries in the medium human development category against less

than one per cent to low human development countries.

PAKISTAN

In 2007, US$5,998 million in remittances were sent to Pakistan. Average remittances per person

were US$37, compared with the average for South Asia of US$33

SRILANKA

In 2007, US$2,527 million in remittances were sent to Sri Lanka. Average remittances per

person were US$131, compared with the average for South Asia of US$33

BANGLADESH

In 2007, US$6,562 million in remittances were sent to Bangladesh. Average remittances per

person were US$41, compared with the average for South Asia of US$33

Total remittance inflows

(US$ millions)

Remittances per capita

(US$)

17. Pakistan 5,998 102. Pakistan 37

6. Sri Lanka 2,527 67. Sri Lanka 131

15. Bangladesh 6,562 98. Bangladesh 41

CONCLUSION

Looking at all the figures it can easily be concluded that Srilanka is by far the most successful

country in comparison with Pakistan and Bangladesh in terms of all the indicators and that is

why it ranks a lot higher than the two countries Pakistan and Bangladesh. Pakistan Especiallyhas to work a lot in order to increase its ranking in every indicator of the index.

SOURCES

http://www.nationmaster.com/red/country/pk-pakistan/eco-economy&all=1

http://hdr.undp.org/en/statistics/

Documents

Evaluate the Performance of Pakistan on the Basis of Latest Human Development Index Report