Why Human Resources are regarded as vital for Economic Development?


Human resources are vital from the point of view of economic development. In the first place, people are used as an instrument of production and are available as factors of production to work in combination with other factors. Secondly, they are the consumers and the objective of economic development is to maximize their economic welfare.

In other words, people are the means to achieve economic development and also the end in them selves. The nature and size of population, therefore, is a crucial factor determining economic development of a country.

1. Adverse effect of population on economic development:


Labour, no doubt has a positive contribution in the process of production and development of an economy. But a rapid rising population acts as an obstacle on smooth economic progress.

(a) Due to rapid growth of population, the per capital income in India has remained either stagnant or shown a very marginal increase in spite of a substantial increase in national income during the plan periods.

(b) The growth of population has created a serious shortage of food grains for which the country was compelled to import food- grains from outside.

(c) Increasing population with growing children increases the number of unproductive population in the country.


(d) Increasing population aggravates the unemployment problem which is found in an under-developed country like India.

(e) The volume of investment falls as a rising population increases the volume of consumption in our country.

(f) An increasing population reduces the quality of life of the masses and makes them less efficient.

(g) Increasing population in rural areas leads to subdivision and fragmentation of land and reduces productivity in the agricultural sector.


2. Population-growth pattern:

The pattern of India’s population-growth can be divided into three periods over the past century from the analytical point of view, the points of division being 1921 and 1951.

The growth of population during first two decades was less than 16 million persons accounting a less than 0.2 per cent growth rate per annum. The reasons for this slow growth can be found from a high death rate caused due to natural calamities, epidemics and lack of medical facilities.

The year 1921 is regarded by the Census Commission, as the year of ‘Great Divide’. From this year, the death rate declined significantly due to introduction of better medical facilities in the country while the birth rate did not show any tendency to fall. The net increase in population from 1921 to 1951 was 110 million persons.


After 1951, population increased in the country at a very alarming rate. It almost doubled itself from 348 million in 1948 to 685 million in 1981. The past two decades have been experiencing a decline in both birth rate and death rate compared to the previous years. If this trend continues, the expected growth rate of population will be less than 2% per annum.

Density of Population:

According to 1991 census, the average density of population per sq. k.m. in India was 267 persons as against 216 in 1981. But as per 2001 census the density of population is 324. It is highest in Delhi- 9,294, next being West Bengal at 904 and lowest being 13 per sq. k.m. at Arunachal Pradesh.

Among the States that have recorded significant decline in growth rate are Tamil Nadu, Karnataka, West Bengal, Gujarat, Goa and Kerala (lowest growth rate – 9.4 in Kerala). The six most populous States – U.P., Bihar, M.P., West Bengal, Andhra Pradesh and Maharashtra, account for 60.9 % of the country’s population in 2001 census.


A disturbing fact of 1991 census was the decline in the ratio of female for 1000 male persons. The sex ratio declined from 934 in 1981 to 929 in 1991. But in 2001 the sex ratio has increased to 933. The sex ratio stands at I05S at Kerala, 986 at Tamilnadu. 990 in Chhattisgarh and 773 (lowest) at Chandigarh.

Population Policy:

The rapid growth of population in the country necessitated for a positive population policy to restrict the growing population. India is the first country in Asia to adopt a comprehensive population policy and family planning programme in 1952. The family planning programme started at a modest rate with an expenditure of Rs. 70 lakhs during the 1st Plan, which increased to Rs. 5 crores during 2nd Plan, to Rs. 30 crores in the 3rd Plan. In the 4th Five Year Plan Rs. 315 crores were allotted for family planning programme with the objective of reducing the birth-rate.

During the 5th Plan period, there was a significant change in Government’s attitude towards family planning and emphasis was shifted from clinical approach to an integrated policy of health, family planning, nutrition and child-care policy. The basic objective was to encourage the small family norm through proper financial incentives and motivational programmes. The Plan aimed at reducing the birth rate from 40 per thousand to 25 per thousand by the end of the plan. During this period, the new population policy was introduced. New Population Policy, 1976: The main features of 1976 policy are as follows:

(a) The Government proposed legislation to raise the age of marriage from 18 for girls and 21 for boys.

(b) Programme was made to expand female education in all States.

(c) Monetary incentives have to be provided in order to attract people for family planning.

During the 6th Plan the objective was to reduce the net reproduction rate to unity by 1996 for the country as a whole and by 2001 A.D. for all States from the present level. The 8th Plan, realizing the situation revised the target to achieve unity net reproduction rate by 2011 – 16 A.D.

Swami Nathan Policy:

In July, 1993, an Expert Group under the chairmanship of Dr. M.S. Swami Nathan was appointed to formulate a draft for the new population policy by the Ministry of Health and Family Welfare. The draft plan was basically concerned with gender inequality and the discrimination against the women. It calls for decentralizing the family planning programme to the grass-root level and calls for empowering one million women members from the Panchayat level to carry out the programme. It further suggested the setting-up of Population and Social Development Commission to operate a Population and Social Development Fund.

The committee also pointed out that population, poverty and environment degradation has close linkage and hence all the variables should be simultaneously manipulated to achieve the objective. The International Conference on Population and Development (ICPD) held at Cairo in 199 also laid stress on empowering women as a means of improving the quality of life, which is same as the
India’s New Population Policy.

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