India today stands as one of the world’s fastest-growing major economies, yet millions of its citizens still lack access to quality healthcare, education, and basic economic security. This tension – between impressive GDP numbers and persistent human deprivation – sits at the heart of understanding what “development” actually means for India. Is a country truly developed when its stock markets thrive but its children go malnourished? The answer depends entirely on how you define development in the first place.
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Two ways of measuring development
The most conventional way to measure development is through economic metrics – gross domestic product (GDP), per capita income, industrial output, and trade volumes. By these standards, India has made extraordinary strides. India’s GDP grew from $266 billion in 1991 to $2.3 trillion in 2018, and the country has since emerged as a $3.5 trillion-plus economy. Post-liberalisation growth rates climbed from roughly 3-4 percent annually to over 8 percent during the boom years of 2004-2014. These are not small achievements for a nation that inherited, at independence in 1947, a fragile, predominantly agricultural economy, burdened by high illiteracy among its 340 million citizens.
Yet economic growth alone tells only part of the story. A rival and arguably more complete framework comes from Nobel laureate Amartya Sen, whose landmark 1999 work Development as Freedom redefined the entire concept. Sen argued that development is best understood as a process of expanding the freedoms that people enjoy, rather than merely increasing national income or industrial output. This is a fundamental reorientation: instead of asking “how much is the economy growing?”, Sen asks “what can people actually do and be?”
Amartya Sen’s capability approach
Sen argues that development entails five distinct “instrumental” freedoms: political freedoms, economic facilities (including access to credit), social opportunities such as education and healthcare, transparency guarantees, and protective security against abject poverty. Together, these freedoms expand what Sen calls human capabilities – the real, substantive ability of individuals to live lives they have reason to value.
This framework directly challenges narrow GDP-focused models. Sen points out that there is no direct link between a country’s GNP growth rate and the real freedoms that its citizens enjoy. He illustrates this by noting that countries like South Africa and Brazil have higher per capita GNP than Sri Lanka, yet perform worse on life expectancy – a core indicator of human freedom. In the Indian context, Sen and co-author Jean Drèze argued that while economic reforms were overdue after 1991, they could be far more productive if the social facilities were there to support economic opportunities for all sections of the community.
Sen’s framework also directly shaped the construction of the Human Development Index (HDI), developed by the UNDP, which measures progress across three dimensions: health (life expectancy), education (years of schooling), and standard of living (GNI per capita). This index moves well beyond GDP and allows for more honest comparisons of well-being across countries and regions.
India’s historical path to development
Understanding India’s contemporary development challenges requires a look back at its historical context. When India gained independence in 1947, it inherited an economy that had been shaped by over two centuries of colonial rule – marked by structural imbalances, stagnant productivity, and widespread poverty. India’s share of the world economy had declined from 24.4% in 1700 to 4.2% in 1950, and its share of global industrial output fell from 25% in 1750 to just 2% in 1900 – a direct consequence of colonial deindustrialisation and resource extraction.
Post-independence, India adopted a mixed-economy model with state-led planning and import substitution. While this built institutional foundations, the growth rate was sluggish and poverty remained widespread. The 1991 balance-of-payments crisis – when India’s foreign exchange reserves could cover barely two weeks of imports – forced a structural turning point. Under Prime Minister P.V. Narasimha Rao and Finance Minister Manmohan Singh, sweeping liberalisation reforms were introduced: the dismantling of the “Licence Raj,” reduced tariff barriers, and an opening to foreign investment. Economic liberalisation led to rapid growth but also widened the gap between rich and poor, with urban areas progressing faster than rural regions.
The growth-without-development paradox
India’s post-1991 trajectory presents what analysts have called a growth-without-development paradox. GDP has expanded impressively, yet key human development indicators have lagged behind. As of 2023, India ranked 130th out of 193 countries on the HDI, with a score of 0.685 – still below the 0.700 threshold for “high human development.” Despite decades of economic growth, India sits in the “medium human development” category, sharing that rank with Bangladesh.
The inequality dimension compounds this picture sharply. A 2024 World Inequality Lab report estimated that 22.6 percent of India’s national income went to the richest 1 percent, while the bottom 50 percent took home only 15 percent. On the wealth side, the disparity is even starker: the top 1 percent held 40.1 percent of total wealth, while the bottom half owned just 6.4 percent. Inequality reduces India’s HDI by 30.7% – one of the highest losses in the region.
Health and education deficits
Sen’s capability approach flags health and education as foundational to human freedom – and this is precisely where India’s gaps are most visible. India’s public health expenditure stands at around 2.1% of GDP, far below the WHO-recommended 5%, and out-of-pocket health expenditure accounts for roughly 48% of total health spending, pushing millions into poverty every year. Malnutrition data from the National Family Health Survey (NFHS-5) shows that 35.5% of children are stunted and 57% of women aged 15-49 are anaemic.
In education, the situation is equally uneven. Enrollment in primary schools is now nearly universal – a significant achievement – but learning outcomes tell a different story. ASER reports show that many children in Grades 3-5 cannot read basic texts or perform simple arithmetic. Dropout rates at the secondary level remain a concern, especially for girls, and a persistent digital divide has widened access gaps further.
Gender inequality as a capability deprivation
Sen placed particular emphasis on women’s development as a critical dimension of capability expansion, and this remains one of India’s most pressing challenges. India has one of the largest gender gaps in labour force participation – a 47.8 percentage point difference between women (28.3%) and men (76.1%). Women also face limited access to education, credit, and decision-making power across many regions, directly constraining household well-being and child development outcomes.
There is, however, at least one powerful counter-example within India itself. Kerala has the highest score on the Gender Development Index in India, demonstrated by near-universal literacy, a low infant mortality rate of 7 per 1,000 live births (compared to 28 nationally), and a female life expectancy of nearly 80 years. Kerala’s model – built on decades of investment in public health and education, land reform, and decentralised governance – is widely cited as evidence that capability-focused development is achievable even without corresponding wealth levels. It embodies, in practice, much of what Sen theorised.
Regional disparities and uneven progress
Development in India is deeply uneven across states. Southern states like Kerala, Tamil Nadu, and Karnataka lead on health and education indicators, while states like Bihar, Uttar Pradesh, and Jharkhand continue to lag significantly behind. The poverty rate among Scheduled Tribes stands at roughly 33% – nearly triple the national average, according to NITI Aayog data. Rural poverty is approximately 2.5 times higher than urban poverty, and rural schools and hospitals consistently lack adequate infrastructure.
This regional divergence directly reflects the uneven distribution of both economic growth and social investment. The benefits of liberalisation have not been equally distributed, with urban areas progressing faster than rural regions and the services and IT sectors generating wealth concentrated in a small segment of the workforce. India’s inability to shift more of its workforce from agriculture – where 45.5% of workers remain – to more productive sectors continues to constrain broad-based development.
Progress made and the path ahead
It would be inaccurate to paint India’s development story as one of failure. There has been substantial, measurable progress. India’s HDI value rose from 0.434 in 1990 to 0.685 in 2023, a gain of over 53%, outpacing both global and South Asian averages. Life expectancy has reached its highest level since the index’s inception, and 135 million Indians escaped multidimensional poverty between 2015-16 and 2019-21. Government programmes like MGNREGA, Jan Dhan Yojana, and Ayushman Bharat have extended social protection to previously excluded populations.
But the challenge ahead – as Sen’s framework makes clear – is not simply to sustain GDP growth but to ensure that growth translates into expanded capabilities for all citizens, particularly the most marginalised. Sen’s emphasis on transparency and accountability has also informed governance reforms worldwide, with his argument that corruption and lack of transparency hinder development shaping policies that prioritize institutional integrity. For India, this means not just building more roads or attracting more FDI, but investing in the quality of public education, closing the gender gap in the labour market, strengthening rural healthcare, and reducing the structural exclusions that hold back Scheduled Castes, Tribes, and women.
The Kerala example, the UNDP’s HDI framework, and Amartya Sen’s own analysis all point in the same direction: development is not a number on a growth chart. It is the expansion of what people can do, choose, and become. For India – a country of immense diversity, deep historical inequities, and enormous human potential – the distance between GDP milestones and genuine human flourishing remains the most important developmental challenge of our time.
What do you think? India has achieved remarkable economic growth since 1991, yet millions still lack access to basic healthcare and quality education – does this mean the country’s development model needs a fundamental rethink? And if Sen is right that freedom is both the goal and the means of development, which specific “unfreedoms” do you think most urgently need to be addressed in India today?
References
- https://en.wikipedia.org/wiki/Economic_liberalisation_in_India
- https://www.legacyias.com/evolution-of-indian-economy/
- https://www.britannica.com/money/economy-of-India
- https://raggeduniversity.co.uk/2014/05/10/development-as-freedom/
- https://en.wikipedia.org/wiki/Development_as_Freedom
- https://www.researchgate.net/publication/27466009_Amartya_Sen's_Development_as_Freedom
- https://vajiramandravi.com/upsc-exam/evolution-of-indian-economy/
- https://en.wikipedia.org/wiki/Economic_history_of_India
- https://uppcsmagazine.com/impact-of-the-1991-economic-reforms-on-indias-growth-and-development-a-transformative-journey/
- https://www.undp.org/india/press-releases/india-shows-progress-human-development-index-ranks-134-out-193-countries
- https://www.britannica.com/topic/socioeconomic-challenges-in-India
- https://vajiramandravi.com/current-affairs/human-development-in-india/
- https://uppcsmagazine.com/despite-high-economic-growth-indias-low-human-development-indicators-challenges-to-balanced-and-inclusive-development/
- https://en.wikipedia.org/wiki/Kerala_model
- https://www.undp.org/india/press-releases/indias-human-development-continues-make-progress-ranks-130-out-193-countries
- https://kingsthinktankspectrum.wordpress.com/2025/02/03/freedom-at-the-heart-of-progress-a-review-of-amartya-sens-development-as-freedom/
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