What is the Best Metric for Measuring India's Progress?

By LEAD Research Team

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What metric best measures a nation’s progress? A composite metric that is a combination of different factors is not as sound as it may seem at first sight because of the subjective bias involved in the weights allotted to individual factors. A more fundamental approach I believe, is to think through what is most critical for a particular nation at a particular point in time and then define a metric based on this single, most crucial factor that would contribute most to a nation’s progress. This is the approach followed in this article.

I would also draw a distinction between what may be termed ‘Outcome metrics’ such as GDP, Yearly Growth Rates, Rate of Capital Formation and Inflow of Foreign Direct Investment, for example, and what I would term ‘Causative metrics’ which are critical drivers of progress.
Which causative factors would one consider in the case of India? The key drivers for development and progress in India would include Infrastructure, Healthcare, Financial Inclusion and Education. There are strong arguments for each of these.
How then would one choose one between these four powerful drivers of progress? To answer this, we will need to step back for a moment to try and understand a basic cause for development.
An often-neglected aspect in development is the role of the demographic transition. The demographic transition is essentially about a 4-stage process of drop in the mortality rate followed by a fall in the fertility rate, which over several decades leads to a change in the age structure of the population causing a demographic shift where a large proportion of the population is in the working age group (15 to 65 years) causing an increase in the national income. This is termed the ‘demographic dividend’, a crucial stage which lasts a few decades. Thus at the end of the transition, a country is more developed than it was in the beginning. A metric for measuring this is the ‘Dependency Ratio’ which gives the ratio of the population below 15 and over 65 years to the working population in the age group 15 to 65 years. Table 1 gives the figures and projections for the 4 BRIC and 4 developed countries over a 70 year period.
Dependency Ratio (percentage)
1980
1990
2000
2010
2020
2030
2040
2050
India
75
69
64
54
50
47
46
47
China
67
54
47
35
40
45
57
62
Brazil
72
67
54
47
43
45
49
56
Russian Federation
47
49
45
39
48
53
54
66
UK
56
54
54
52
57
62
66
68
USA
52
52
52
49
56
63
63
64
France
56
52
54
54
62
67
70
71
Germany
52
45
47
52
56
70
78
78

Table 1    (Source: World Bank – World Development Indicators)

A low dependency ratio is when a country is at the peak of its demographic dividend. China has had the demographic dividend working for it over the last two decades. It may be noted that the first country to reap the benefits of Industrialization was England and it was able to take advantage of this opportunity because of the demographic dividend it was experiencing at that time. The large working age population was able to contribute to helping their country make the best possible use of industrialization. We thus have two examples, close to two centuries apart in England and China which illustrate the critical importance of the demographic dividend as a driver for development.
India, which has shown a relatively more gradual improvement in its Dependency Ratio over this period, is poised to get ahead of China on this critical metric in the early 2030s and then surge ahead of China and the other major countries over the next 2 decades.
However, the demographic dividend does not automatically translate to progress. Having a mass of working age adults who are ill equipped and not properly qualified and trained is of little advantage. As India will also inevitably encounter an ageing population after the age structure shifts again, the best possible use must be made of the advantage it currently has.
Thus, education may be considered the primary factor for India’s progress at this stage because it directly ensures that the country will capitalize on its demographic dividend.
One now needs to arrive at the appropriate metric based on education. For this, the key question is ‘What aspect of education is the most important for the overall progress of India?’
The answer is ‘the quality of education at the primary level i.e. classes 1 to 6’. Quality of primary education is vital because it lays the foundation for all other education that an individual receives in his or her life.
While progress has been made in India on some facets of education such as enrollment rates, improvements in school infrastructure and increased investments in higher education, the quality of education in primary schools is in a dismal state, particularly in the state run government schools. These are often very poorly managed and many lack even basic facilities.  A high student-teacher ratio, poorly educated and qualified teachers, teacher absenteeism, lack of enough number of classrooms, poor teaching materials and lack of toilets have all continued to persist over the years. A research study I undertook a few years back in rural and urban locations in Karnataka and Andhra Pradesh brought out the disconcerting fact that children in Class 8 are barely able to read a Class 2 text book in English and there were schools where in one single classroom there were five circles that were drawn, each of which represented a class from 1 – 5 and there was just one teacher to take all these classes. These were not exceptions but representative of the overall situation across the country, especially in rural areas, as brought out by other studies as well.
The poor quality of education in India is reflected by the results of International Learning Tests such as PROBE conducted by the OECD, which ranked India 73 out of the 74 countries that had participated in 2011. India was only just ahead of Kyrgyzstan.
The quality of primary education is therefore the key factor for measuring India’s progress and the best metric for this would be improvement in scores in well-designed learning tests for primary school children across the country. The way learning tests are designed is of prime importance. Tests which capture only rote learning are misleading as these can hide actual learning levels and give a false impression of education. Learning tests which capture not only subject knowledge but reasoning, critical thinking and analysis need to be developed and used as the metrics that would be the touchstone of India’s progress.
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Conclusion
The essence of this article is not that there are 4 important ‘causative metrics’ to be considered and education is being arbitrarily picked among them. The argument is rather that the most important underlying factor beyond these four is the demographic dividend which India is in the process of benefiting from over the next few decades. This is due to the change in the age structure of the population.
However, the demographic dividend is a necessary but not a sufficient cause for development and will not lead to development on this own.
Education can play the biggest role in helping a country capitalize on its demographic dividend because it can lead to a mass of working age population being transformed to human capital and this is why it has been selected. Within education, the quality of primary education has been identified as key as it is the basis for all education an individual receives in the future.
There are multiple ways of improving the quality of primary education which could include tracking teacher performance to reduce absenteeism by asking teachers to take a photograph of themselves every day and send it, having children tutored after schools by Bal Sakhi’s (local persons from the community) and also providing deworming tablets to children to increase school attendance. All these methods have proven to be useful after being tested through Randomised Control Trials (RCT’s) undertaken by the Jameel Poverty Action Lab (JPAL).
All of the above and other methods can be used to bring about improvements in the quality of primary education but the final outcome for all of these is that a student’s learning must improve and this is what the learning tests would capture and hence improvements in scores on well-designed learning tests have been chosen as the best metric to measure’s India’s progress.

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