Reaping the demographic dividend

blog.forumias.com/reaping-the-demographic-dividend/

August 4th, 2022

Source: The post is based on the article “Reaping the demographic dividend”

published in The Hindu on 4th August 2022.

Syllabus: GS 1 – Population and associated issues.

Relevance: About the recent UNPD report on population.

News: World Population Prospects 2022 forecasts that the world’s population will touch
eight billion this year and rise to 9.8 billion in 2050.

Must read: The UN World Population Prospects Report and Population Issues in
India – Explained, pointwise

About China’s population policy

A long-time critic of China’s population policy believes that without the one-child policy,
China’s population would have naturally risen and peaked at 1.6 billion in 2040. This
would allow them to reap a much longer “demographic dividend.

At the present policy by 2050, China will have only 1.3 billion people, of whom 500 million
will be past the age of 60.

Must read: Population control measures in India – Explained, pointwise

About the demographic dividend in India

In contrast, India’s population would have peaked at 1.7 billion, of whom only 330 million
will be 60 years or older. India is getting a demographic dividend that will last nearly 30
years.

Deloitte’s Deloitte Insights (in 2017) expects “India’s potential workforce to rise from 885
million to “1.08 billion people over the next two decades from today.” The insights
contends that “the next 50 years will be an Indian summer that redraws the face of global
economic power.”

McKinsey & Company’s report, ‘India at Turning Point’ (in 2020) suggested how India can
“create $2.5 trillion of economic value in 2030 and support 112 million jobs, or about 30%
of the non-farm workforce in 2030.” These include digitisation and automation, shifting
supply chains, urbanisation, rising incomes and demographic shifts, and a greater focus
on sustainability, health, and safety are accelerating.

Read more: India in 2023: The challenge and opportunity of being the most
populous country

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How do India and China reap their demographic dividends?
India today is compared to China, the only country it can be reasonably compared to. The
Great Leap Forward and the Cultural Revolution in China fuelled China’s growth for
decades.

The IT technologies in India have matured exponentially. Now the IR can revolutionise
learning and transform Indian society at an astonishingly low cost.

India does not have a Hukou system which in China attaches rural folk to rural parts
creating a deep divide between urban China. But the Hukou system disincentivises
migration to urban areas. For instance, only about 36% of China’s overall population is
urban.

Read more: Elderly population in India – Explained, pointwise

What India should do to reap its demographic dividend?

The major challenges in reaping demographic dividend are a) India’s bad infrastructure,
b) poorly skilled workforce that will impede growth. Hence, India should focus on both.

India needs to invest massively in quality schools and higher education as well as
healthcare.

India must seize the moment and not be incremental in its approach.

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