Human Capital Formation in India

Main problems of human capital formation in India are:

1. Rising Population. Rapidly rising population adversely affects the quality of human capital formation in developing countries. It reduces per capita availability of existing facilities. A large population requires huge investment in education and health. This diverts the scarce money to production of human capital at the cost of physical capital.
2. Long Term Process. The process of human development is a long term policy because skill formation takes time. The process which produces skilled manpower is thus slow.
3.  High Regional and Gender Inequality. Regional and gender inequality lowers the human development levels.
4. Brain Drain. Migration of highly skilled labour termed as “Brain Drain” adversely affects the economic development.
5.  Insufficient on-the-job-training in agriculture. Agriculture sector is neglected where the workers are not given on-the-job training to absorb emerging new technologies.
6.  High Poverty Levels. A large proportion of the population lives below poverty line and do not have access to basic health and educational facilities. A large section of society cannot afford to get higher education or expensive medical treatment for major disease.