Chapter overview: Chapter 2 Comparing BRICS nations on major health indicators This chapter deals with the comparison of major health indicators across BRICS (Brazil, Russia, India, China and South Africa) nations. The BRICS nations are termed as the group of emerging economies with enormous potential of growth in future. By comparing the major health indicators of five major emerging economies helps to analyze the present status of healthcare in these economies. This also helps to find out the respective government s approach towards healthcare and the need for further improvement. As India is slowly gaining pace in healthcare segment, this kind of comparisons against major economies helps us to organize our resources in a better way. Top 11 indicators as mentioned by WHO (2014) were taken for comparison. This is also in line with the fulfillment of first objective. 2.1 Need for a comparative study: BRICS comprising Brazil, Russia, India, China and South Africa are the emerging economies with sound financial and political climate at the international level. The term BRIC originated in 2001 to underline the transformation of four nations from being Developing countries to Emerging economies. In 2010 South Africa was invited to join the group making it as BRICS. Though the individual nations have different sizes and resources when they are put together as BRICS they sounds massive (Bulletin, 2013). Over the last decade, BRICS have established cooperation with the developing countries by providing increased financial and technical assistance. It is predicted that BRICS countries will play a dominant role in world economy on par with the Industrialized/developing economies. BRIC in 1990 had a GDP share of around 10% (10% to the world s total GDP) and less than 4% in world trade. BRIC along with South Africa now (2010) has contributes over 25% of world s GDP and 15% of world trade (External, Of, & Union, 2012).
With respect to the economic growth during the period of 1990 to 2010, barring Russia the economic size of all other countries has increased tremendously. The size of Brazil has increased fourfold, India by five times, South Africa by three times and China by a whooping fourteen times. There are increased predictions that the BRICS nations plays a formidable role in shaping macroeconomic policy and to some extent these were observed after the 2008-20 financial crisis (Bulletin, 2013). However there are many issues that need attention such as the low ranking of BRICS nations in many of the social indicators. With their economy and population growing at a steady pace it is important to analyze the living standard of the people in these nations (Almeida, 2009). 2.2 Choosing Health indicators: There are many indicators on health available from World Bank and World Health Organization (WHO). Many of the past studies have insisted on a group of indicators as independent variables and tried to find their impact on life expectancy at birth. While study makes no attempt to find out the relationship between health indicators, this would like to compare those set of indicators among the BRICS nations. 2.3 Country profile: Brazil: Brazil is the largest country in Latin American region in terms of area. It has a population of 192 million (as per 2010 data). Of these the economically active population was around 53% (2010). The unemployment rate was around 8.3 % (2009). In 1990 the Brazil s share of world s GDP was 3.3%, in 2010 the share got reduced to 2.9%. Brazil stood at 8 th position in 2010 for its GDP contribution (GDP adjusted to PPP). When it comes to world trade during the period of 1990 2010 Brazil s trade grew from 0.8% to 1.2%. The amount spend on education as a percent of GDP was 4.3 % (2009) (Hasan & Luthara, 2014).
Brazil was prone to high level of inflation and had a negative effect of high exchange rates. In Brazil the transformation from a closed economy into a semi open economy was slow due to many internal problems and inefficient government measures. Brazil has demographic which is positively correlated to its economic activity. The concern for them is the low level of technical expertise among the people which will erode productivity gains. But these are transitory in nature, won t hurt the economy in the long run. Brazil along with India and China has a greater consumer market with a huge pool of middle class population. Brazil was quite a fragile economy with high between 1990s and the beginning of the 21 st century. Till the late 1990 s, the country s prominent contributor towards GDP was its agricultural sector. But with the opening up of economy, services sector got the much needed boost. The financial assistance from IMF made it in a relatively comfortable position with higher foreign exchange reserves (Brics Report, 2010). Russia: Russia is the largest country in the world in terms of area. Russia was one of the most powerful countries during the Second World War period. The total population of Russia was around 143 million (2010). The population who are economically active was 53% (2011). The unemployment rate in 2011 was 6.6 %. In 1990 the Russia s share of world s GDP was 2.5%, in 2010 the share got up to 2.9%. Russia stood at 6 th position in 2010 for its GDP contribution (GDP adjusted to PPP). When it comes to world trade during the period of 1990 2010 Russia s trade grew from 1.5% to 2.3%. The amount spend on education as a percent of GDP was 4.2 % (2010) (Hasan & Luthara, 2014). Russia had a destructive chaos in the past with a socialistic economy. The transition of Russia from a socialistic economy to a more competent capitalistic economy remained erratic. Russia lost its strategic natural and human resources it enjoyed in the late 1970 s. Even though it has a formidable military, the country no longer posts a serious threat to the global economic giants in the 21 st century. Russia natural resources now are finite and human resources amid quality are in the state of decline. Russia trade
surplus are stagnant, it is highly dependent on its export of oil and natural gas (Brics Report, 2010). India: India is the second largest country in Asia in terms of area. It has a population of 1210 million (as per 2010 data). By taking the population into account it is the second largest nation globally. The economically active population was around 40% (2009). The unemployment rate was around 2.5 % (2009). In 1990 the India s share of world s GDP was 3.1%, in 2010 the share increased up to 5.4%. India stood at 4 th position in 2010 for its GDP contribution (GDP adjusted to PPP). When it comes to world trade during the period of 1990 2010 India s trade grew from 0.5% to 1.8%. The amount spend on education as a percent of GDP was 3.1 % (2009) (Hasan & Luthara, 2014). India had lifted itself from a state of protectionism, the rise happened similar to that of china but with a different modus operandi. India s economic transaction was similar to that of Brazil, form a closed economy till 1990 s to a semi open economy in 2010. India s trade deficit is the largest one among BRICS. But with a growing dynamic population its matter of time before the trade deficit shortens and may turn up as trade surplus as in the case of China. Even though it suffered a trade imbalance at the onset of global economic crisis in 2008-09 period, the domestic consumption made the effect lesser to some extent (Broadberry, 2012) When it comes to savings and investment rates India is just behind China among BRICS. This largely helps India to have an investment led growth which is largely financed by domestic savings. One of the salient features of India is its sheer volume of population and the vast demographic features. This middle income country had its share of struggle in the past when it comes to growth rate. It had patches of robust growth rate and years of underperformance. The future of India is distinct and clear as once the middle income class broadens and deepen, it provides a solid platform for development (Bulletin, 2013).
China: China is the largest country in Asia in terms of area. It has a population of 1344 million (as per 2010 data). By taking the population into account it is the largest nation globally. The economically active population was around 57% (2011). The unemployment rate was around 4.1 % (2011). In 1990 the China s share of world s GDP was 3.9%, in 2010 the share increased up to 13.6%. China stood at 2 th position in 2010 for its GDP contribution (GDP adjusted to PPP). When it comes to world trade during the period of 1990 2010 China s trade grew from 2.1% to over 9%. The amount spend on education as a percent of GDP was 3.7 % (2010) (Hasan & Luthara, 2014). China like Russia too had a socialistic economy in the past but unlike Russia it has some firm authority and well laid rules to guide them towards a market economy. China now stands as a unique nation with the structural transformations having an enormous impact on its living class. The economic opening, liberalization strong fundamental rules with an able leadership of their semi capital regimes helped them to achieve economic heights (Broadberry, 2012). China s emergence from a crippling socialism had lessons learned from Japanese Meiji revolution. China is the only economy poised to become a global power in terms of economic revolution and military power. China has the highest saving and investment rates among BRICS. China has a strong economy which is expected to dismiss US as the largest economy by next decade. However when it comes to individual living standards, china needs a dramatic shift in order to match with the developed/industrialized nations. China has the capability of reproducing technical expertise of countries like Taiwan and South Korea. China along with Russia is the only countries in BRICs having a trade surplus. China has a record currency reserves for foreign exchange payments. China in future is predicted as a dynamic exporter which will enhance its reserves and trade balance much in favor of exports (Brics Report, 2010).
South Africa: South Africa is the 24 th largest country globally in terms of area. It has a population of 50 million (as per 2010 data). The economically active population was around 35% (2011). The unemployment rate was around 24.9 % (2010). In 1990 the South Africa s share of world s GDP was 0.9%, in 2010 the share got reduced to 0.7%. South Africa stood at 26 th position in 2010 for its GDP contribution (GDP adjusted to PPP). When it comes to world trade during the period of 1990 2010 South Africa trade was constant. The amounts spend on education as a percent of GDP was 10.1 % (2010). South Africa was invited to join BRICS as it is one of the largest economies in the sub-sahara region and it accounts for almost quarter (25%) of the regions total GDP. South Africa is rich in natural resources especially gold, diamonds and platinum. It does have an excellent infrastructure, a stable macro and micro financial climate and clear cut regulatory frameworks. The inclusion of South Africa helps BRIC members to have an access to a very large African market. South Arica is the economically developed country in Africa and it serves as a gateway to Africa (Bulletin, 2013). In 2025 the projected GDP size of BRICs will be more than half of the grown G- 6 economies. In 2050 the BRICS are set to overtake G-6 as the largest group in terms of GDP output. In October 2012 the IMF released an economic outlook which placed Brazil, Russia, India and China among the top 10 economies in the world.
2.4 Comparing health indicators: 2.4.1 Total Health Expenditure as % of Gross Domestic Product (GDP) Graph 2.1: Total Health Expenditure as % of Gross Domestic Product (GDP) The graph 2.1 shows the Total Health Expenditure (THE) of BRICS nations as a percentage of GDP (Gross Domestic Product). While the world s average is around 10% of GDP, in India it is only 3.9% of GDP. The Total Health Expenditure is maximum in Brazil (9% of GDP) among the BRICS nations. All the other BRICS nations have Total Health Expenditure greater than that of India s. With India s GDP growing steadily over the past two decades it is highly needed to allocate more financial resources towards healthcare.
2.4.2 Public Healthcare Expenditure as % of Total Healthcare Expenditure The graph 2.2 shows the Public Health Expenditure (PHE) as a percentage of Total health expenditure (THE). While the world s average is 60% in India it is just 30 %. This clearly portrays that on an average around the world out of every single rupee spend for healthcare 60% of that is taken care by government sources. In India the situation is worse with only 30% of every rupee spend comes from government sources. This exerts additional financial burden for individuals as they have to take care of majority of the healthcare spending. All other BRICS nations have public healthcare expenditure greater than India. It is only in the twelfth five years plan Indian government has decided to double the spending in healthcare. Graph 2.2: Public Healthcare Expenditure as % of Total Healthcare Expenditure
2.4.3 Out Of Pocket healthcare expenditure as % of Total Healthcare Expenditure Graph 2.3: Out of Pocket healthcare expenditure as % of Total Healthcare Expenditure The graph 2.3 shows the Out Of Pocket expenditure (OOP) as a percentage of Total Healthcare Expenditure (THE). The Out Of Pocket expenditure is the amount a person pays from his pocket for availing healthcare. The rising Out Of Pocket expenditure indicates a low level of contribution from government and other sources such as health insurance and NGO s contribution. In India the Out Of Pocket expenditure is as high as 60%. This states that out of every rupee a person spends for healthcare 60% of that comes from his pocket. Higher out Of Pocket expenditure leaves very little income available for other expenditures to a person and his family. Especially in low- middle income countries like India the higher Out Of Pocket expenditure drives millions towards poverty. The Out Of Pocket expenditure of all other BRICS nations are less than 40% with South Africa having the least Out Of Pocket expenditure of under 10%.
2.4.4 Improved sanitation facilities (% of population with access) Graph 2.4: Improved sanitation facilities (% of population with access) The graph 2.4 shows the percentage of people who have access to improved sanitation facilities. The improved sanitation facilities include flush/pour flush (to piped sewer system, septic tank, and pit latrine), ventilated improved pit (VIP) latrine, pit latrine with slab, and compositing toilet. In India the population with access to improved sanitation facilities is only 35%. All the other BRICS nations have greater than 60% of population having access to improved sanitation facilities. India is one major country where sanitation facilities need a big improvement in order to have healthier lives. The present Indian government has made an ambitious plan to stop public defecation by building toilets to all the households by 2019. Many industries have already started building toilets program as a part of corporate social responsibility. This will be major step towards enhancing hygienic condition (Economic times, August 2014).
2.4.5 Per capita expenditure on Healthcare (in US $) Graph: 2.5: Per capita expenditure on Healthcare (in US $) The graph 2.5 shows per capita health expenditure of BRICS nations in terms of US Dollars. The per capita health expenditure is the average amount a person spends for healthcare per annum. The more per capita expenditure on health may leads to avail quality treatment and benefits. In India the per capita expenditure on healthcare is just 59 $. China has per capita expenditure of 230$ whereas the other three BRICS nations such as Brazil, South Africa and Russia have per capita healthcare expenditure of over 600 $. This clearly shows the vast discrepancy in per capita healthcare expenditure between India and other BRICS nations.
2.4.6 Population aged 65 and above (in %) The graph 2.6 shows the percentage of persons aged 65 years and above in BRICS nations. The higher percentage of persons having age of 65 and above indirectly indicates the strength of healthcare in the respective country. In India the percentage of persons aged 65 and above is 5.2 percentage of the total population. All other BRICS nations except India and South Africa have more than 6 percentage of people aged 65 and above. This also shows that the healthcare in India has to improve so that more people can get quality treatment and extend their life span. Graph 2.6: Population aged 65 and above (in %)
2.4.7 Infant Mortality rate (per 1000 births) Graph 2.7: Infant Mortality rate (per 1000 births) The graph 2.7 represents the infant mortality rate of BRICS nations. The infant mortality rate is the number of infants not able to reach one year of age, per 1,000 live births in a given year. Even though the mortality rate shows a steady decrease its still higher in India when compared with other BRICS nations. In India the infant mortality rate is 56 per 1000 live births where as in countries like China, Russia and Brazil it s under 15 per 1000 live births. Increase in infant mortality rate shows the inadequacy of primary natal care and prevalence of mal nutrition in India.
2.4.8 Population growth (in %) Graph 2.8: Population growth (in %) The graph 2.8 shows the growth in population among BRICS nations. Population growth is the exponential rate of growth of mid-year population from t-1 (Previous year) to (current year). It is expressed in terms of percentage. Increased population growth has a negative impact on per capita health expenditure thereby reduced quality of healthcare. The population growth is highest in India among BRICS nations. Russia has the least growth rate of 0.4% whereas for India its 1.28%. While the Indian government has numerous schemes to check on the population growth it also needs to address the basic needs of citizens as that will have an indirect effect on life expectancy of an individual.
2.4.9 Measles (Immunization 12-23 months) Graph 2.9: Measles (Immunization 12-23 months) The graph 2.9 shows the percentage of children getting measles vaccination among BRICS nations. Child immunization measures the percentage of children 12-23 months who received vaccinations. A child is considered adequately immunized against measles after getting one dose of vaccine. Measles is highly contagious disease which mainly affects children. It has strong prevalence in developing and under developed nations. In developed nations measles has been eradicated due to immunization. In India the vaccination is only 74% of the total child population of 12-23 months where as in countries like China, Brazil and Russia its almost 100%.
2.4.10 GDP per capita Graph 2.10: GDP per capita The graph 2.10 shows the per capita GDP (Gross domestic Product) among BRICS nations. GDP per capita is gross domestic product divided by mid-year population. GDP is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not included in the value of the products. All the data are in current US dollars. Per capita GDP is an important indicator as it shows the ability of an individual to finance his/her healthcare costs. While India has the highest Out Of Pocket expenditure among BRICS nations its per capita GDP is the lowest among BRICS nations. All other countries have per capita GDP above 6000$ whereas for India it s only around 1500$.
2.4.11 Life Expectancy at Birth (in years) Graph 2.11: Life Expectancy at Birth (in years) The above graph 2.11 shows the life expectancy at birth among BRICS nations. Life expectancy at birth indicates the number of years a newborn infant would live if prevailing patterns of mortality at the time of its birth were to stay the same throughout the life. Life expectancy at birth is highly influenced by all the other 10 indicators mentioned above. High life expectancy at birth reflects high standards of healthcare. The life expectancy at birth in India is 65 years higher than South Africa. China, Russia and Brazil have life expectancy at birth higher than India. The World Bank has recently stated life expectancy at birth as an important indicator to access overall progress of a nation. Many researchers have found strong relation of life expectancy at birth with economic progress of the country. A WHO estimate says that increasing Life expectancy at birth by 10% will increase the economic growth by 0.35% a year. Further Bloom et al. (2004) found that increasing life expectancy by one year improves work productivity and raises economic output by 4%.
2.5 Chapter conclusion: It is clearly evident from the above comparison that India is far below than their counterparts of BRICS nations in terms of health indicators. Hence it is high time for them to address the shortfalls and move forward for a long term healthcare provision which has increased participation from public sector. As our country is aspiring double digit growth, its citizens with good health can help India to realize its full potential.