Why India is yet to reach developed nation status ,despite progress in GDP and health

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Why India is Yet to Reach Developed Nation Status Despite Progress in Health and GDP

Dr B.S.Chakravarthy 

When we look at the data from developed nations such as the USA, UK, Japan, Canada, Germany, Italy, and France, one fact stands out clearly — their maternal and child health indicators are consistently in single digits. Japan has an MMR of 3, U5MR of 2.4, IMR of 2, and NMR of 1. Italy records an MMR of about 2, U5MR 2.8, IMR 2, and NMR 2. Germany has an MMR of 4, U5MR around 3.7, IMR 3, and NMR 2. France reports an MMR of 7, U5MR 4, IMR 3, and NMR 3. The United Kingdom shows an MMR close to 8, U5MR about 5, IMR around 3.6, and NMR 3. Canada records an MMR of 12, U5MR 5.1, IMR 4, and NMR 3. The United States has an MMR of about 17, U5MR 6.5, IMR 5, and NMR 3.

India is aware of these differences and has worked consistently to improve its health sector, particularly since 2014. The maternal mortality ratio has improved from 130 to 88 per 100,000 births. The infant mortality rate is now 27 per 1,000 live births, down from 39 in 2014. The neonatal mortality rate has dropped to 19 per 1,000 live births, compared to 26 in 2014. Under-five mortality has improved from 45 to 31 in the same period. These gains align well with WHO’s SDG health targets and are the result of improvements in sanitation, nutrition, vaccination coverage, and health infrastructure.

However, moving towards developed nation status requires much more. India’s public health budget stands at only 2.1% of GDP. The total health expenditure, including both public and private, is around 3.83% of GDP for 2021–22. The government’s share in total health expenditure has increased from 29% in 2014–15 to 48% in 2021–22. In comparison, all developed nations spend over 10% of GDP on public health.

The main reason for this gap lies in India’s low tax revenue, which is around 11% of GDP, whereas developed nations collect over 25%. Low tax revenues are linked to the large informal economy, where 80–85% of the workforce operates outside formal systems, limiting productivity, tax collection, and social security coverage. With limited funds, health has to compete with welfare schemes for food, fertilizers, and fuel, as well as defense and infrastructure spending. This makes increasing health expenditure a slow process.

India’s per capita income is about 2,800 USD in 2024, compared to 13,000–15,000 USD in developed nations. In addition, regulatory, judicial, and administrative systems are slower and less efficient than those in high-income countries. These factors collectively slow down India’s progress toward developed nation status.

The journey is ongoing, and the progress since 2014 shows what is possible with focused effort. The next leap will depend on raising revenues, investing more in human development, and ensuring that health is not just a competing priority but a foundation for economic and social advancement.