Composite Indices of Basic Human Needs and Income in India

This study provides a few composite indices of development, using the State level data for 1981 and 1991. It uses the principal component technique, which provides a straightforward procedure for deriving a single index from a multiplicity of variables, Income and basic need indicators. The results show that a considerable inter-State inequality exists in the case of income, basic needs and overall development index. The overall development and income indices indicate that the inequality has slightly declined during the last decade. However, the income inequality is much lower than the inequality in the overall development. We hope that this study will help policy makers to identify the States making improvement in the living standards and to know whether the State disparity has been reduced over time in India.