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Social Expenditure and Human Development in Gujarat

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Social Expenditure and Human
Development in Gujarat
Himani Baxi
The relative position of Gujarat
on economic and human
development indicators for
10 years from 2004–05 is
examined. The state government’s
priorities for human development
in terms of budgetary allocation
to the social sector in general,
and education and health sectors
in particular over a 10-year period
are compared using expenditure
ratios and per capita social
sector expenditure.
The author is extremely grateful to
C Rangarajan for continuously mentoring and
guiding in this research work, starting from
the initial level of discussion to giving the final
shape to this article. The author is also thankful
to Jeemol Unni for her inputs at various
critical junctures.
Himani Baxi (himani.baxi@ahduni.edu.in)
teaches at Amrut Modi School of Management,
Ahmedabad University, Ahmedabad.
58
G
ujarat is one of the most eco-
nomically advanced states of
India contributing around 7.3%
to India’s gross domestic product (GDP)
(2015–16), with 4.9% share in the popu-
lation. The average annual growth rate
of gross state domestic product (GSDP)
of Gujarat was estimated to be 14.18%
during 2004–05 to 2013–14. The state
ranked among the top five economically
advanced states. However, the social
development indicators for Gujarat have
not kept pace with the development in
the economic indicators (Kalaiyarasan
2014). The progress of Gujarat, particu-
larly in health and education, was dis-
appointing despite its high economic
growth (Hirway 2013).
The twin goals of high economic
growth and better social development
seem to be at odds in Gujarat. In the
Indian federal structure, states play a
critical role for social development. The
states incur more than 80% of the com-
bined government expenditures in
these areas (RBI 2013).
There are constant questions raised
about whether Gujarat is allocating
sufficient fi nancial resources for its
social development. Is Government
of Gujarat spending less on social
development in comparison to other
high-income states and high human
development states such as Tamil
Nadu, Kerala or Maharashtra? This
study explores the relative economic
and social sector performance of
Gujarat for 10 years. It then examines
the state government’s priorities as
revealed by budgetary allocation to
the social sector in general and health
and education in particular. In this
way, we provide a comparative analy-
sis of states’ allocation of financial re-
sources to the social sector and exam-
ine whether social sector is a lower
APRIL 6, 2019
priority for Gujarat as compared to
other states.
Literature Review
The existing literature suggests a strongly
positive relationship between economic
growth and human development among
the Indian states (Ghosh 2006; Mukher-
jee et al 2014). Rangarajan (2013) looked
at the relationship between government
expenditures and social development
and found a weak correlation. However,
he found a strong correlation between
income index and health, and education
index, which are the primary social
development indicators. The Reserve Bank
of India (2013) measured the impact
of per capita social sector expenditure
of the states on Human Development
Index (HDI) from 1993–94 to 2006–07
and found a positive relationship. The
study emphasises on the need for higher
per capita social sector expenditure
for strengthening the human resources
which would enable the country to reap
the demographic dividend.
Particular studies about Gujarat’s
economic and social development para-
dox argue that the primary cause of low
social progress lies in policy choice and
development priorities of the state gov-
ernment. According to Hirway (2014),
Gujarat became one of the fastest grow-
ing states in the country by ignoring or
even sacrificing development goals. The
policy frame has been one of exclusion
rather than social inclusion. A compara-
tive study of the development model of
Gujarat and Tamil Nadu (see Joshi and
McGratha 2015) points out that Guja-
rat’s development trajectory appears
unusually lopsided. The study concludes
that the implementation of government
policies as a manifestation of political
ideology and the quality of public
administration play a defining role in
explaining Gujarat’s more lopsided and
Tamil Nadu’s more balanced human
development trajectories. Studies that
analyse the expenditure of Gujarat have
mostly concluded that the state’s expend-
iture policies have been responsible for
the deterioration in the human devel-
opment indicators.
vol lIV no 14 EPW Economic & Political Weekly

Ghosh (2012) finds that government
expenditure on education and other social
sectors have been diminishing from 1991 to
2008. Sharma (2012) finds similar results
for healthcare expenditures between 1990
and 2010. The share of health expendi-
ture as a ratio of total expenditure is lower
than the all states average and much lower
than Tamil Nadu and Maharashtra.
The state finance reports (RBI 2013–14
and 2014–15) bring out that Gujarat has
failed to improve its expenditure alloca-
tion to social sector. Vijayaraghavan
(2018) notes that with reference to eco-
nomic indicators such as private invest-
ment, business reforms, and contribution
to India’s GDP, Gujarat is among the
leaders. The state is also doing well in
achieving fiscal stability. However, it
lags behind most other states in social
sector spending. It looks at the percent-
age share of social sector expenditure
in the total budget, and concludes that
Gujarat has prioritised attaining a
certain degree of fiscal stability at the
expense of social development. As a
result it lags behind Karnataka in fiscal
stability and states like Andhra Pradesh,
Karnataka, Tamil Nadu and Telangana
in social development.
The studies examining states’ social
sector expenditure mainly look at and
compare the relative share of social sector
expenditure in the total state budget or the
social sector expenditure as a percentage
of states’ domestic product. However, due
to the differences in the size of state’s
budget and state’s domestic products,
what is critical to observe is the amount
of social sector expenditure per person
in the state and not just the relative
share. Also considering the differences
in the price level across states over a pe-
riod of time, this study examines both
nominal and real per capita expenditure
on social sector of the Indian states.
Methodology
It is observed in the literature that stud-
ies have analysed human development
performance of Indian states, using the
HDI from India Human Development
Report—UNDP which was last published
in 2011. In this study, we first examine
the relative position of Gujarat’s HDI
and compare it with the relative position
Economic & Political Weekly EPW APRIL 6, 2019
of real per capita net state domestic
product (NSDP) for 1999–2000 and
2008–09. It observes the change in the
relative position of Gujarat in terms of
economic and human development dur-
ing this period. However, the last HDI
available is only for 2008–09. Hence, it
is essential to study the overall econom-
ic and social development performance
of Indian states and observe the relative
standing of Gujarat. Thus, this article
examines the status of economic and
human development of the states using
various indicators, ranks them based on
their performance, and observes relative
standing of Gujarat. Sixteen Indian
states have been selected for the study
and their economic and social develop-
ment is examined for the period from
2004–05 to 2013–14.1
The economic growth of states is as-
sessed using real per capita NSDP (base,
2004–05 prices). Human development
performance of states is examined by
taking various indicators from health
and education sector for the years
2005–06 and 2015–16.2 Ranking is done
for an individual indicator. The indica-
tors have been selected based on the
availability of comparable and reliable
indicators across the states and time. In
the recent literature on the measurement
of human development, Burchi and De
Muro (2015) prepared a conceptual
framework for the classification of hu-
man development indicators. The study
adopts a similar framework for the clas-
sification of human development indica-
tors listed in Table 1.
Table 1: Classification of Indicators
Health Indicators
Input indicators Government hospitals per lakh population
Number of beds per lakh population
Number of PHC per one lakh
rural population
Number of CHC per one lakh
rural population
Output indicators Percentage of household using
improved sanitation
Institutional birth
Outcome indicators Life expectancy at birth
Infant mortality rate
Children aged 6–59 months
who are anaemic
Sex ratio at birth
vol lIV no 14
NOTES
In addition to the above indicators,
the education development index esti-
mated and published by the National
University of Educational Planning and
Administration (NUEPA) and the Minis-
try of Human Resource Development
(MHRD) is also used. This index is avail-
able for every year since 2005–06.
Twenty-four indicators are used to com-
pute education development index for
each state. These indicators are classi-
fied into four major components, namely
access, infrastructure, teacher and out-
come. The component-wise index and
also consolidated index value for 2005–06
and 2014–153 have been considered here,
and accordingly 16 states are ranked
to observe the relative performance
of Gujarat.
For analysing the state’s expenditure
policy in terms of budgetary allocation
to the social sector, other studies have
mostly used human expenditure ratios4
(UNDP 1991). However, the report itself
notes that “What probably matters more
than the human expenditure ratio is
human development spending per person
in absolute terms” (UNDP 1991). Hence,
this study also uses the per capita social
sector expenditure adjusted with infla-
tion. There are five indicators examined
in this study: (i) Percentage of total ex-
penditure devoted to the social sector
and health and education sector5 (hu-
man priority); (ii) percentage of social
expenditure devoted to human priority;
(iii) percentage of states income that
goes to social sector and human priority
sector; (iv) per capita real expenditure on
Education Indicators
Pupil–teacher ratio primary—All school
Primary school sections per thousand
projected child population (6 to 11 years)
Upper primary schools per thousand
projected child population (11 to 14 years)
Gross enrolment ratio primary
Gross enrolment ratio upper primary
Net enrolment ratio primary
Net enrolment ratio upper primary
Women with 10 or more years of schooling
Literacy rate
59
NOTES

social sector and human priority sector. not observe the HDI and NSDP ranks the poor performance compared to all
The average budgetary allocation for 10 moving in the same direction from India average.
years (2004–05 to 2013–14) is calculated 1999–2000 to 2007–08. Although, the In February 2018, NITI Aayog released
for each indicator for each state rather value of HDI for Gujarat improved slight- a report titled “Healthy States, Progressive
than only comparing the ratio for the ly from 0.466 in 1999–2000 to 0.527 in India.” It was the first such attempt to
initial year and the last year. The social 2007–08, its relative position dropped compile measure and compare states’
expenditure6 in India is broken into down from ninth to 10th rank. At the performance in the health sector by
revenue and capital expenditure. Until same time, the rank for the economic Table 3: Ranking of States Based on Per Capita
recently, the social expenditure was also performance of Gujarat improved from NSDP (Constant)
States 2004–05 2013–14
broken into plan and non-plan expendi- seventh in 1999–2000 to fifth in 2007– PCNSDP Rank PCNSDP Rank
ture. For this study, the revenue and 08. This implies that while Gujarat’s (`) (`)
capital expenditure have been added rank on economic growth improved, its Andhra Pradesh 25,959 9 42,170 9
and total social expenditure is taken. human development rank, in fact, fell. Assam 16,782 13 23,392 14
Also, instead of analysing plan and non- Certainly, it is a matter of particular Bihar 7,914 16 15,506 16
plan expenditure separately, the total concern since Gujarat ranked among Gujarat 32,021 6 63,168 3
Haryana 37,972 1 67,260 2
social expenditure has been analysed. the top five economically robust states.
Himachal Pradesh 33,348 3 54,495 6
Table 3 provides the ranking of states
Economic and Social Development Karnataka 26,882 8 46,012 8
based on per capita NSDP at constant
Kerala 32,351 5 58,961 5
This section first estimates the rank cor- prices (2004–05) for the fiscal year
Madhya Pradesh 15,442 14 26,853 12
relation coefficient between the HDI and 2004–05 and 2013–14 for analysing the Maharashtra 36,077 2 69,097 1
per capita NSDP (constant price) of 227 states’ economic performance. It is evident Odisha 17,650 12 24,929 13
Indian states for two distinct periods that Gujarat outperformed many states Punjab 33,103 4 49,529 7
1999–2000 and 2007–08 (Table 2). as far as economic growth is concerned. Rajasthan 18,565 11 31,836 11
Rank correlation coefficient value for Its relative position significantly improved Tamil Nadu 30,062 7 62,362 4
1999–2000 is 0.91 and for 2007–08 it is from sixth rank in 2004–05 to third rank Uttar Pradesh 12,950 15 19,233 15
0.79. This indicates a strong positive as- in 2013–14. Further, the CAGR of per cap- West Bengal 22,649 10 36,293 10
sociation between economic perfor- ita NSDP (Constant) for Gujarat during 2004–05 series is used for NSDP constant.
Source: EPWRF Time Series.
mance and human development among the same period is observed to be second
Indian states. However, while examin- highest at 7% following Tamil Nadu Table 4: Gujarat’s Rank Based on Health
ing the specific case of Gujarat, one does with 7.56%. Tamil Nadu also improved Indicators
Indicators 2005–06 2015–16
Table 2: Ranks of State Based on Economic and its position from seventh rank to fourth Value Rank Value Rank
Human Development Indicator rank in terms of real per capita NSDP. Input indicators
States 1999–2000 2007–08 Table 4 provides the ranks of Gujarat Government hospitals 0.99 5 0.64 11
PCNSDP HDI PCNSDP HDI
Rank Rank Rank Rank among 16 selected states based on the per lakh population (0.68) (1.62)
Andhra Pradesh 12 14 11 14 performance across various health indi- Number of beds per 69.18 7 46.21 9
lakh population (45.66) (62.33)
Assam 17 16 19 15 cators for the fiscal years 2005–06 and
Number of PHC per one 3.37 7 3.59 8
Bihar 22 18 22 20 2015–16. It is evident from Table 4 that in lakh rural population (3.13) (3.04)
Chhattisgarh 18 20 14 22 the case of percentage of “household using Number of CHC per one 0.86 2 0.92 6
Delhi 2 1 2 2 improved sanitation” Gujarat ranked lakh rural population (0.45) (0.65)
Goa 1 3 1 4
third for both the years. Life expectancy Output indicators
Gujarat 7 9 5 10 Percentage of
at birth and infant mortality rate (IMR)
Haryana 5 6 3 8 household using 44.2 3 79.2 3
are two indicators where there is a mar- improved sanitation (29.1) (48.4)
Himachal Pradesh 6 4 7 3
Jammu and Kashmir 13 10 16 9
ginal improvement by one rank from Institutional birth 52.7 6 88.7 7
Jharkhand 19 22 18 18 2005–06 to 2015–16. For all the other (38.7) (78.9)

Karnataka 10 11 10 11 health indicators the relative position of Outcome Indicators

Life expectancy 66.4 9 68.2 8
Kerala 8 2 6 1 Gujarat worsened. What is critical is that
at birth (2004–08) (2009–13)
Madhya Pradesh 16 19 20 19 not only in the case of outcome indica- (65.4) (67.5)
Maharashtra 4 7 4 6 tors but also in the case of input indica- Infant mortality rate 50 9 34 8
Odisha 20 21 17 21 tors, the relative position of Gujarat has (57) (41)
Punjab 3 5 8 5 deteriorated. An indicator, “availability Children aged 6–59 69.7 10 62.6 12
Rajasthan 15 13 15 16 months who are anaemic (69.4) (58.4)
of government hospital per one lakh
Tamil Nadu 9 8 9 7 Sex ratio at birth@ 906 9 907 11
population” observed a reduction in the
Uttar Pradesh 21 15 21 13 (2001) (2011)
value itself (from 0.99 to 0.64). Two of (914) (919)
Uttarakhand 14 17 13 17
the outcome indicators’ value namely @ Census India 2001 and 2011 data.
West Bengal 11 12 12 12 Figures in brackets indicate value of all India average.
PCNSDP 2007–08 at the price of 2004–05.
“children aged 6–59 months who are Source: RBI (2015–16), NFHS (2015–16).
Source: HDR–India, 2011 and EPWRF for PCNSDP. anemic” and “sex ratio at birth” indicate Rural Health Statistics, MHFW, GoI, 2005–06 and 2015–16.

60 APRIL 6, 2019 vol lIV no 14 EPW Economic & Political Weekly

 NOTES

preparing a comprehensive health index. from input category, “school per thousand component, not just the rank, but also
The report presents states’ health index projected child population” both in the index value dropped significantly.
for two consecutive years, 2014–15 and primary and upper primary and one While examining the relative perfor-
2015–16. It is a weighted composite index each in output and outcome categories, mance of Gujarat across health and edu-
of around 23 indicators classified in “GER in primary education” and “women cation, we observe that excluding one
three domains: (i) outcome; (ii) govern- with 10 or more years of schooling” dem- indicator each from health and educa-
ance and information; and (iii) key onstrated deterioration in the state’s per- tion, that is, “Percentage of Household
inputs/process. The report categorises formance. As regards to the value of the Using Improved Sanitation” from output
Gujarat state as an “achiever,” with the GER and NER in primary and women with category and “literacy rate” from out-
overall rank assigned to the state as 10 or more years of schooling, the state come category, the state fails to achieve
fourth. It is surprising to observe that with registers a poor performance as compared the position among top five performers.
respect to the input domain the state to all-India average performance. The other immediate inference is that
ranks fifth and with respect to govern- Table 6: Educational Development Index the state has perhaps performed rela-
ance and information domain the state (All School–All Management) tively better in the education sector than
ranks second and third respectively. The Indicators 2005–06 2014–15 in the health sector.
Index Rank Index Rank
state’s rank is 10 out of 21 major Indian Access 0.541 5 0.147 14
states. The performance of Gujarat for out- Social Sector Expenditure
Infrastructure 0.674 7 0.874 5
come domain as noted in the NITI Aayog Teacher 0.62 3 0.875 3 This section analyses the pattern of
report is similar to our study. Outcome 0.556 10 0.726 11 social sector expenditure of 16 Indian
The relative position of Gujarat among Consolidated 0.632 7 0.681 4 states with a view to understand the
Indian states concerning education indi- Source: Elementary education in India: Progress towards relative position of Gujarat. Table 7 pro-
UEE NUEPA 2006–07 and 2014–15.
cators is given in Table 5. It is observed vides 10 years’ average value of relative
that in the case of pupil–teacher ratio and Table 6 gives index values for Gujarat share of social sector expenditure, edu-
gross enrolment ratio (GER) in upper state as estimated by the NUEPA and cation expenditure and health expendi-
primary there is an improvement in the District Information System for Education ture in the total state’s expenditure. The
relative standing of Gujarat. Literacy rate (DISE). The rank for Gujarat is derived table also provides 10 years’ average val-
and net enrolment ratio (NER) in the from comparing the educational devel- ue of relative share of education and
primary sector exhibited improvement, opment index values of 16 selected health expenditure in the total social
although by only one rank. Two indicators states. The composite indicator shows sector expenditure of the states. The
Table 5: Gujarat’s Rank Based on Education an improvement for Gujarat from sev- purpose of examining the percentage
Indicators enth position to fourth position follow- share of social expenditure in total allo-
Indicators 2005–06 2015–16
Value Rank Value Rank ing Himachal Pradesh, Karnataka and cation is to observe the relative priorities
Input indicators Tamil Nadu. However, in the case of of states in terms of expenditure policy
Pupil–teacher ratio 35 11 19 7 index of the component, access,8 the or budgetary allocation. For all states in
primary–all school (36) (24)
performance has deteriorated from fifth India, expenditure on health is a lower
Primary school sections
per thousand projected
position to fourteenth position. In access priority than education. The table clearly
child population Table 7: Share of Social Expenditure Components
(6 to 11 years) 7 9 7 12 (Average of 10 years, from 2004–05 to 2013–14) (%)
Upper primary schools States Share of Social Share of Education Share of Share of Education Share of
per thousand projected Expenditure in Expenditure in Health Expenditure Expenditure in Health Expenditure
child population Total Expenditure Total Expenditure in Total Expenditure Social Expenditure in Social Expenditure
(11 to 14 years) 7 5 9 7 Andhra Pradesh 10.61 3.97 1.11 37.65 10.43
Output indicators Assam 6.71 3.98 0.70 58.51 11.50
Gross enrolment 100.3 8 97.24 Bihar 8.97 5.03 0.86 56.37 9.86
ratio primary (103.77) (99.21) 11 Gujarat 8.40 3.45 0.81 41.05 9.60
Gross enrolment 49.91 11 95.73 6 Haryana 10.44 4.81 0.91 45.85 8.70
ratio upper primary (92.81) Himachal Pradesh 11.07 5.57 1.47 50.08 13.19
Net enrolment 78.89 12 82.46 11 Karnataka 8.56 3.97 0.88 46.39 10.21
ratio primary (84.53) (87.3)
Kerala 8.55 4.83 1.26 56.41 14.69
Net enrolment ratio 36.64 11 73.35 10
Madhya Pradesh 7.00 3.08 0.79 44.08 11.22
upper primary (74.74)
Maharashtra 11.94 6.27 1.09 52.57 9.05
Outcome indicators
literacy rate* 69.14 6 78.03 5 Odisha 8.17 3.86 0.77 47.61 9.29
(65) (74) Punjab 9.15 5.10 1.30 55.50 14.29
Women with 10 or more 23.5 8 33 10 Rajasthan 8.98 4.15 0.94 46.37 10.46
years of schooling (22.3) (35.7) Tamil Nadu 8.02 3.31 0.79 41.51 10.00
* Census India 2001 and 2011 data. Uttar Pradesh 5.38 2.66 0.68 49.42 12.98
Figures in the bracket indicate value of all India average.
West Bengal 8.23 4.12 0.95 50.42 11.68
Source: DISE flash statistics: Elementary education in India
Progress towards UEE NUEPA 2004–05 and 2015–16, NFHS Average of selected 16 states 8.76 4.26 0.96 48.74 11.07
reports 3 and 4. Source: Estimated from EPWRF Time Series.

Economic & Political Weekly EPW APRIL 6, 2019 vol lIV no 14 61

NOTES

indicates that Gujarat and Tamil Nadu important to note here that this is the expenditure and health expenditure. The
have a similar pattern of expenditure state that had dropped from third rank NSDP deflator is used for the conversion
across all the components. Kerala’s share to sixth rank during these 10 years as far of nominal expenditure into real ex-
of health expenditure in total social as economic performance is concerned. penditure. The per capita expenditure is
expenditure is the highest at 14.69%, Thus, higher share of social expenditure taken as the average of 10 years, from
followed by Punjab (14.29). In the case of in the total budgetary allocation or the 2004–05 to 2013–14 and also of the re-
share of education expenditure in social state’s income does not necessarily re- cent five years from 2009–10 to 2013–14.
expenditure, Assam is at the highest flect higher amount of money spent on Tables 9 and 10 provide the data of
with 58.51% share followed by Kerala an individual citizen of a state. 10-years’ and five-years’ average of real
(56.41%) and Bihar (56.37%). With the purpose of examining the per capita social expenditure and the
The social expenditure ratio reflects amount of financial resources made rank associated with that. The data indi-
the relative contribution to a particular available for the social development for an cate that Gujarat’s rank is four and three
sector and hence with relatively less individual in the state, the study estimates respectively in the case of 10-years’ and
share also the absolute amount spent on per capita social expenditure, education five-years’ average per capita health
social sector may be much higher. With Table 9: Per Capita Social Expenditure at Constant Prices, 2004–05 Prices
lower value in the base, the high ratio may (Average of 10 years, from 2004–05 to 2013–14) (` )
States Per Capita Rank Per Capita Rank Per Capita Rank
not imply high absolute value. Assam Social Expenditure Education Expenditure Health Expenditure
although is allocating 58.51% in educa- Real Real Real
tion, the actual amount spent on education Andhra Pradesh 2,202 8 824 12 230 8
was only `840 lakh in 2013–14, while that Assam 1,765 11 1,032 8 207 10
of Gujarat was `1,567 lakh during the Bihar 1,006 16 560 16 96 16
Gujarat 2,629 5 1,077 6 259 4
same year having 41% share of education
Haryana 2,633 4 1,208 4 229 9
expenditure in the social expenditure.
Himachal Pradesh 5,016 1 2,529 1 659 1
The social expenditure as a percentage Karnataka 2,276 7 1,045 7 233 7
of states’ income is also an indicator to Kerala 2,552 6 1,433 3 377 2
assess states’ expenditure policy and Madhya Pradesh 1,484 14 658 14 164 13
understand how important the social Maharashtra 2,743 2 1,443 2 246 6
development is for the state economy. Odisha 1,642 13 778 13 150 15
Gujarat’s social expenditure as percentage Punjab 1,816 10 1,006 9 259 5
of its NSDP is around 5.5% (Table 8) similar Rajasthan 1,850 9 857 10 194 12
to that of Kerala, Maharashtra and Tamil Tamil Nadu 2,710 3 1,124 5 271 3
Nadu. However, it is slightly lower than Uttar Pradesh 1,294 15 634 15 162 14
West Bengal 1,714 12 853 11 195 11
the all states’ average. Himachal Pradesh
Average of selected 16 states 2,208 1,066 245
is spending 11.5% of its NSDP in the social Per capita expenditure is estimated based on the projected population from Census 2001 and 2011.
sector, highest among all states. It is Source: Same as Table 7.

Table 8: Share of Social Expenditure in NSDP

(Average of 10 years, from 2004–05 to 2013–14) (%) Table 10: Per Capita Social Expenditure at Constant Prices, 2004–05 Prices
States Share of Share of Share of (Average of Five-years, from 2009–10 to 2013–14) (`)
Social Education Health States Per Capita Social Rank Per Capita Rank Per Capita Rank
Expenditure Expenditure Expenditure Expenditure Real Education Expenditure Health Expenditure
in NSDP in NSDP in NSDP Real Real
Andhra Pradesh 10.73 4.02 1.12 Andhra Pradesh 2,606 8 988 11 276 9
Assam 8.92 5.21 1.03 Assam 2,037 11 1,194 7 261 10
Bihar 9.44 5.29 0.93 Bihar 1,200 16 648 16 102 16
Gujarat 5.50 2.25 0.53 Gujarat 3,267 4 1,344 6 345 3
Haryana 4.87 2.23 0.42 Haryana 3,167 5 1,464 4 279 7
Himachal Pradesh 11.49 5.74 1.51 Himachal Pradesh 5,553 1 2,952 1 739 1
Karnataka 6.46 2.98 0.66
Karnataka 2,680 7 1,192 8 276 8
Kerala 5.53 3.11 0.81
Kerala 3,116 6 1,728 3 465 2
Madhya Pradesh 7.12 3.14 0.79
Madhya Pradesh 1,838 14 830 14 193 13
Maharashtra 5.04 2.65 0.46
Maharashtra 3,347 2 1,779 2 293 6
Odisha 7.24 3.44 0.67
Punjab 4.12 2.29 0.59 Odisha 1,966 13 929 13 173 14
Rajasthan 7.44 3.44 0.78 Punjab 2,087 10 1,166 9 298 5
Tamil Nadu 6.02 2.50 0.60 Rajasthan 2,033 12 964 12 217 12
Uttar Pradesh 7.77 3.82 0.99 Tamil Nadu 3,321 3 1,386 5 341 4
West Bengal 5.83 2.92 0.67 Uttar Pradesh 1,553 15 751 15 169 15
Average of selected West Bengal 2,134 9 1,039 10 229 11
16 states 7.10 3.44 0.79 Average of selected 16 states 2,619 1,272 291
Source: Same as Table 7. Source: Same as Table 7.

62 APRIL 6, 2019 vol lIV no 14 EPW Economic & Political Weekly

 NOTES

expenditure among total 16 states. The the form of improvement in human de- programme and policy design. The action
states are one rank behind Tamil Nadu velopment. However, the improvement plan or the design of the various pro-
and Kerala. in human development is disappointing grammes related to education and health
Along with the real per capita expendi- as observed across several human devel- may be less effective. This includes iden-
ture, the study also compares the per opment indicators. Gujarat’s performance tification of beneficiaries or implementing
capita expenditure in nominal terms for on human development reveals that in agencies, programme structure and ob-
further validation. Table 11 gives the five seven out of 10 health indicators the jectives, etc. The resource allocation for
years average9 of per capita social ranks have deteriorated during 2005–06 such programmes may not provide the
expenditure, education expenditure and to 2015–16. Two of the ranks observed desired results and there can be a problem
health expenditure in nominal terms. In an improvement by moving one rank up- of non-productive utilisation of financial
nominal terms also Gujarat’s relative wards. With regards to performance in resources. The second possible argument
standing is not very different than the the education sector also four out of nine may be of lopsided development with
expenditure in real terms. Gujarat ranks indicators show a decline in the ranking the concentration of efforts and financial
fifth with respect to per capita social ex- of Gujarat. The human development resources to only few districts or talukas
penditure. It ranks fourth with respect to performance of Gujarat is less impres- or section of the society. Such lopsided
per capita health expenditure and sixth sive than states like Tamil Nadu, Maha- development programmes create greater
with respect to per capita education ex- rashtra or Kerala. While Tamil Nadu social disparity and may bring down the
penditure, just a rank behind Tamil Nadu. observed an improvement in its economic overall human development performance
Table 11: Per Capita Social Expenditure at Current Price
performance, the human of a state. The third possibility can be
(Average of Five years, from 2009–10 to 2013–14) (`) development indicators inefficiency in implementation of devel-
States Per Capita Rank Per Capita Rank Per Capita Rank also improved in parallel opment programmes at various stages.
Social Education Health
Expenditure Expenditure Expenditure
as the rank of the state This may result into an inefficient utili-
Andhra Pradesh 4,414 8 1,685 12 467 7 improved across all the sation of financial resources or the leak-
Assam 3,382 13 1,995 7 428 10 selected health and edu- ages. However, before arriving at any
Bihar 2,119 16 1,146 16 179 16 cation indicators. Al- conclusion or inference, these possibili-
Gujarat 4,956 5 2,039 6 527 4 though Gujarat could not ties need to be examined in detail with
Haryana 5,525 2 2,544 4 489 6 have similar achievements the strong evidence. An in-depth analysis
Himachal Pradesh 8,535 1 4,543 1 1,135 1 in human development as or comparative analysis of development
Karnataka 4,458 7 1,992 8 463 8
compared to the top five programmes and their designing may
Kerala 4,859 6 2,693 2 727 2
performers, we did not help explain the paradox. It is essential to
Madhya Pradesh 3,026 14 1,366 14 318 13
observe any disparities evaluate the implementation of various
Maharashtra 5,070 4 2,693 3 445 9
Odisha 3,546 10 1,655 13 312 14
in the allocation of finan- human development programmes and
Punjab 3,493 12 1,953 9 501 5 cial resources for social carry out social auditing. If this paradox
Rajasthan 3,677 9 1,732 10 393 11 development. The public is not studied in detail and is not
Tamil Nadu 5,296 3 2,206 5 540 3 expenditure ratio, social addressed, merely increasing the budg-
Uttar Pradesh 2,610 15 1,263 15 281 15 allocation ratio or social etary allocation to the social sector will
West Bengal 3,533 11 1,715 11 377 12 priority ratio of Gujarat is not help improve the human resource
Source: Same as Table 7. not significantly different base in Gujarat.
The per capita expenditure on social from other better performer states. In
sector clearly indicates that Gujarat is not fact, the state ranks among the top five in notes
an outlier in the allocation of financial per capita social sector expenditure. 1 The period in this study is restricted up to
2013–14 to make the series comparable as in
resources to the social development. The Hence, an important question that 2014, India adopted the new series—2011–12 for
relative share of social sector expenditure needs to be addressed is the reason for the national income estimation.
may be lower than few Indian states but the lagging human development indica- 2 The NFHS reports which are the major source
of health indicators for this study provide data
in the case of the absolute amount spent, tors for Gujarat despite having similar for 2005–06 and 2015–16. Hence, all the other
Gujarat is at par with the states that are social sector expenditure policies as that human development indicators of both health
and education are taken for 2005–06 and
better performers with respect to eco- of other states. 2015–16 to maintain the comparability. How-
nomic growth and human development. It is evident that almost an equal ever, the economic indicators and fiscal perfor-
mance is done for the period under study, that
amount of financial resources are made is, 2004–05 to 2013–14
Conclusions available for human development in 3 The 2015–16 EDI is not available.
4 The public expenditure ratio: the percentage of
The economic performance of Gujarat Gujarat as other states and despite this national income that goes into public expendi-
observed a remarkable growth in per Gujarat experienced a deterioration in ture. (ii) The social allocation ratio: the per-
centage of public expenditure earmarked for
capita NSDP during 2004–05 to 2013–14; relative position for various human social service. (iii) The social priority ratio: the
the state moved upward from sixth to third development indicators. There are a few percentage of social expenditure devoted to
human priority concerns. (iv) The human ex-
position. Consequently, the benefits of possible reasons explaining this paradox. penditure ratio: the percentage of national in-
economic growth should be apparent in One possibility is the issue concerning come devoted to human priority concern.

Economic & Political Weekly EPW APRIL 6, 2019 vol lIV no 14 63

NOTES
5 Education and sports and medical and public
health receive more than 50% of the social
expenditure of Indian states and hence these
two sector are considered as human priority
sector in this article.
6 As per the concurrent list, the social sector
expenditure of states in India include expendi-
ture on (i) education and sports, (ii) medical
and public health, (iii) family welfare, (iv) water
supply and sanitation, (v) housing, (vi) urban
development, (vii) welfare of schedule castes,
(viii) labour and labour welfare, (ix) social se-
curity and welfare, (x) nutrition, (xi) relief on
account of natural calamities, etc.
7 HDR 2011 includes 23 states with north-east states’
combined human development performance but
this study compares HDI of only 22 states and ex-
clude north-eastern states due to unavailability of
combined per capita NSDP of north east states.
8 The access component includes variables such
as density of schools per 10 sq km, availability
of schools per 1,000 child population, and ratio
of primary to upper primary school/sections.
9 The 10 years’ average of per capita expenditure
in nominal terms is also calculated. Gujarat
ranks fifth in the case of per capita social
expenditure and health expenditure. It ranks
eighth in case of per capita education expenditure.
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Features
Presents all-India
and state-wise
annual data from
1981 onwards.
Structured in three
sections :
• Literacy in India
• School Education
• Higher Education
Includes data on
SC/ST students and
school education in
rural areas.
vol lIV no 14 EPW Economic & Political Weekly