Countries or states are often classified as developed or underdeveloped depending upon several factors. These factors range from per capita income to the death rate that is currently prevalent in the region. The comparison is often taken in the negative connotation, but in reality, it provides a clear picture of where a country or state’s development stands. Without comparison, It would be impossible to say whether the country or state’s development is progressing or not. Comparison helps us to understand the mechanics behind this difference in development and apply well thought out solutions to rectify the issues and problems that are hampering the development process.

The simplest form in which countries or states are compared is based on the per capita income. The World Development Report (WDR) is an annual report published since 1978 by the International Bank for Reconstruction and Development (IBRD) or World Bank. It provides an in-depth analysis of various aspects of economic development.

One aspect that it uses is per capita income which is the total income of the country divided by its total population. Countries with per capita income of US$ 12236 per annum and above in 2016, are called rich countries and those with per capita income of US$ 1005 or less are called low-income countries. India comes in the category of low middle-income countries because its per capita income in 2016 was just US$ 1840 per annum. The rich countries, excluding countries of the Middle East and certain other small countries, are generally called developed countries.