Human Capital Formation in India: An Economic Analysis

Abstract

The paper overviews the economic development, human development and human capital formation in India and highlights the human capital formation trends in India. The present study is based on secondary data sources and data for education is taken from “Educational Statistics at A Glance,” Ministry of Human Resource Development, Government of India, while data on labour force and employment statistics has taken from “Data-book Compiled for use of Planning Commission,” 22nd December, 2014. Simple statistical tools such as percentage, ratio, growth rate and compounded annual growth rate along with graphical analysis used for causal relation and trend analysis of human capital formation in India. The present study examines the education and educational infrastructure, labour force and employment generation trends during post reform period in absolute numbers and growth rate. The empirical shows that over the period higher education in India has been improving and liberalization, privatization and globalization has created competitive market for growing human resource. After sixty-five years of independence, around 55% Indian labours still depended on agriculture sector and only qualitative and skilled labour force has been gaining good jobs in urban area, there is need of drastic changes in quality education in India especially in rural area. Employment generation in Karnataka during post 2008 global economic crisis was stagnant while at all India level it has improved slightly. Human capital formation in India improving much faster in private sector than in public sector due to global level completion in private sector.