India seems likely to grow old before it can become wealthy

News: By the middle of this century, the country’s population will finally start to decline, ending up at perhaps a billion by 2100.

India is ageing faster than expected. The latest round of India’s massive National Family Health Survey (NFHS) highlights the point. For instance, in urban India, the fertility rate is now 1.6, according to the NFHS, equivalent to that of the US.

Though declining population is good news, The unexpected speed of the demographic transition has forced India to confront a new problem. The problem is whether India will grow old before it gets rich.

Will India grow old before it can become wealthy?

A comparison of India’s developmental parameters with that of China tell us that, India seems likely to grow old before it can become wealthy. The reasons are,

-Inadequate focus towards Malnutrition

Children born under China’s one-child policy received unprecedented attention from their families, and the quality of their nutrition increased.

In contrast, NFHS shows that Children in India are malnutrition high. In fact, in the five years after 2015-16, acute undernourishment actually worsened for children in most parts of India.

-Education system not aligned with Industrial requirement

Similarly, under China’s one-child policy, average education levels rose sharply. Whereas, In India, the education system is clearly failing. For instance,

Indian companies are already reporting a shortage of skilled manpower. This is because Universities just aren’t producing the kind of workers that companies feel they can employ.

The unemployment rate for college graduates is 19.3%, almost three times higher than the national average, as per the Centre for Monitoring Indian Economy reports.

Increasing Unemployment

According to the International Labour Organization, Two-thirds of working-age Chinese are currently either employed or looking for a job. China’s labour force participation rate is 80%.

In contrast, CMIE estimates that the country’s LPR stands at a mere 43% in India and that the pandemic has “lowered the LPR structurally” to 40%.

Source: This post is based on the article “India seems likely to grow old before it can become wealthy” published in Livemint on 17^th Dec 2021.