The Hindu Editorial Analysis- 24th April 2023 | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

India as most populous can be more boon than bane

Why in News?

China is projected to hand over the baton of the most populous country to India by mid-2023. But for India, there are greater prospects for demographic advantage than serious concerns. The country must focus on reaping the available demographic dividend.

What are the Drivers of these Shifts?

• Mortality and Fertility:
  • Crude Death Rate (CDR): The CDR — the number of persons dying per year per 1,000 population — was 23.2 for China and 22.2 for India in 1950.
    • It fell to single digits for China first in 1974 (to 9.5) and for India in 1994 (9.8), and further to 7.3-7.4 for both in 2020.
  • Life Expectancy at Birth: Another mortality indicator is life expectancy at birth. Between 1950 and 2020, it went up from 43.7 to 78.1 years for China and from 41.7 to 70.1 years for India.
  • Total Fertility Rate: The total fertility rate (TFR) — the number of babies an average woman bears over her lifetime — was as high as 5.8 for China and 5.7 for India in 1950.
    • India's TFR fell to 2 in 2019-2021, from 3.4 in 1992-93.
• Sustained Lows in TFR:
  • Populations can keep growing even with TFRs falling. De-growth requires TFRs to remain below replacement levels for extended periods.
  • The effects of that — fewer children today becoming parents tomorrow and procreating just as much or less — may reflect only after a couple of generations.
  • China’s TFR dipped below replacement first in 1991, which was almost 30 years before India’s.

What are the Challenges and Opportunities?

• Challenges:
  • Having the most people on the planet could prove to be a big negative for India unless it can provide food, education, housing, health services and jobs to its people.
  • The scale of this challenge is ­gigantic.
  • Across India, water scarcity is a chronic issue. All these needs are crucial but by far the single most important thing for India to do is to generate jobs. The scale of this ­particular challenge is truly daunting.
  • In 2020, India has 900 ­million people (67% of the total population) in the working age group of 15-64.
  • This is expected to expand by another 100 million by 2030.
• Opportunity:
  • Claim for permanent member at UNSC: If India becomes the largest country, it will give Indians a claim to be the permanent member of the Security Council.
    • New population will push its existing demand for a permanent seat on the UN Security Council.
    • The geopolitical reality has changed and new powers have emerged which deserve a place alongside the old – Russia, the UK, China, France and the United States.
  • Increase in Fiscal Space: Fiscal resources can be diverted from spending on children to investing in modern physical and human infrastructure that will increase economic sustainability of India.
  • Rise in Workforce: With more than 65% of the working age population, India can rise as an economic superpower, supplying more than half of Asia’s potential workforce over the coming decades.
  • Increase in the Labour Force that enhances the productivity of the economy.
  • Rise in Women’s Workforce that naturally accompanies a decline in fertility, and which can be a new source of growth.

What should be the Strategy of India?

• Mass Prosperity Strategy:
  • India’s large remittances from a small population overseas reinforce that our mass prosperity strategy should be human capital and formal jobs.
  • 0.8 % of software employment workers generate 8 % of GDP.
  • This case is reinforced by remittances from the overseas population of less than 2 % of our resident population crossing USD 100 billion last year.
• Qualitative Shift in Employement:
  • The qualitative shift during the previous five years from low-skilled, informal employment in Gulf countries to high-skilled formal jobs in high-income countries is significant.
  • In 2021, the US replaced the UAE as the single biggest source country with 23 % of remittances. Our rich forex remittance harvest — roughly 25 % higher than FDI and 25 % less than software exports — is fruit from the tree of human capital and formal jobs.
• Additional Jobs:
  • To absorb the influx of young people into the workplace, India would need to create close to 12 million additional, non-farm jobs every year, starting in 2023.
  • This was triple the four million non-farm jobs created annually between 2012 and 2018.
  • India would need a growth rate of 10% per annum to be able to invest in industry so that this army of young people can be absorbed.
• Investments in Education:
  • While India is expected to have a demographic dividend from this large workforce, reaping its potential benefits requires significant investments in education.