Potential Versus Actual HDIs: The Case of Pakistan

This research is an attempt to develop HDI and IHDI for Pakistan at national and sub-national levels to estimate the percentage losses due to inequalities in the HDI dimensions. Education, Health and Standard of Living indicators are aggregated at the level of Primary Sampling Units (PSUs) to estimate the intra-district inequalities. The use of standard UNDP-HDI indicators is not feasible due to non-availability of relevant data at district or provincial levels. Thus, attempt is made to develop the best proxies for the components of HDI using district representative household datasets of Pakistan Social and Living-Standard Measurement Survey (PSLM) for the years 2010-11, 2012-13 and 2014-15. The estimated magnitudes of HDI are quite close with the UNDP global estimates for Pakistan, despite the differences in the methodology and varying component indicators. The magnitudes of national HDIs estimated in this research are 0.52, 0.55 and 0.56 respectively for the years 2011, 2013 and 2015, while the corresponding global estimates are 0.50, 0.54 and 0.55. However, lower magnitude of IHDIs are estimated in this research as compared with the global estimates. This fact indicates that higher level of inequality exists in the component indicators considered in this study for HDI components. The findings of this research are useful for regional planning in terms of resource allocation and prioritizing development alternatives. Information regarding unequal distribution in regions or dimension would facilitate targeted intervention for reduction of inequality.