India’s population is among the youngest in an ageing world. By 2022, the median age in India will be 28 years; in comparison, it will be 37 in China and the United States, 45 in western Europe, and 49 in Japan. India’s working-age population has numerically outstripped its non-working age population. A demographic dividend, said to have commenced around 2004-05, is available for close to five decades. This is an extraordinary opportunity. There are however, two caveats.
First, India’s population heterogeneity ensures that this window of demographic dividend becomes available at different times in different States. While Kerala’s population is already ageing, in Bihar the working age cohort is predicted to continue increasing till 2051. By 2031, the overall size of our vast working age population would have declined in 11 of the 22 major States. Second, harnessing the demographic dividend will depend upon the employability of the working age population, their health, education, vocational training and skills, besides appropriate land and labour policies, as well as good governance. India will gain from its demographic opportunity only if policies and programmes are aligned to this demographic shift. Demography is not destiny.
There is consensus now that among other factors, it was the demographic dividend that powered respectively the Asian economies of Japan, China, and South Korea to spectacular growth. More significantly, in each case, the underlying pattern was fairly similar i.e. countries will benefit from the economic potential of their youth bulge when and where they succeed in providing good health, quality education, and decent employment to their entire population; and not to segments defined by socio-economic status, geography, or historical legacy.
Need for skills
The Economic Survey 2019 calls for additional jobs to keep pace with the projected annual increases in working age population. We need a workforce that is well educated, and appropriately skilled. UNICEF 2019 reports that at least 47% of Indian youth are not on track to have the education and skills necessary for employment in 2030. The projected demographic dividend would turn into a demographic disaster if an unskilled, under-utilised, and frustrated young population undermines social harmony and economic growth. While over 95% of India’s children attend primary school, the National Family Health Surveys (completed up to 2015-16) confirm that poor infrastructure in government schools, malnutrition, and scarcity of trained teachers have ensured poor learning outcomes.
Even while India aspires to become a knowledge economy, millions of young people are getting left behind. The national capital has now demonstrated that when meticulous attention is paid to equity and quality across government schools, huge numbers benefit, with encouraging learning outcomes. High quality education achieves gender parity and propels people forward into more productive lives. A coordinated incentive structure prompting States to adopt a broadly uniform public school system focusing on equity and quality will yield a knowledge society faster than privatising school education can accomplish.
Most districts now have excellent broadband connectivity. Irrespective of rural or urban setting, the public school system must ensure that every child completes high school education, and is pushed into appropriate skilling, training and vocational education in line with market demand. Let geography not trump demography. Modernise school curricula, systematically invest in teacher training so that they grow in their jobs to assume leadership roles, while moving beyond the tyranny of the syllabus. Deploy new technology to accelerate the pace of building human capital by putting in place virtual classrooms together with massive open online courses (MOOCS) to help prepare this huge work force for next-generation jobs. Investing in open digital universities would further help yield a higher educated workforce.
Growing female literacy is not translating into relevant and marketable skills. A comprehensive approach is needed to improve their prospects vis-à-vis gainful employment. Flexible entry and exit policies for women into virtual classrooms, and into modules for open digital training, and vocational education would help them access contemporary vocations. A mushrooming of job portals and organisations are providing employment for trained women, even from home. Equal pay for women will make it worth their while to stay longer in the workforce. Economist Yogendra Alagh has written that the significance of this “deferred bonus” (women entering the workforce), could be higher than the immediate benefits of the dividend from shifts in population age structure.
The recent massive job losses across the automobile, real estate, and IT sectors, as well as in Micro, Small and Medium Enterprises is leading to an alarming fall in private consumption. And if prolonged, these could begin to jeopardise India’s demographic dividend. Policies to restore the ailing economy would bring back the mojo on employment.
On health care
In India, population health is caught between the rising demand for health services and competition for scarce resources. The National Sample Survey Office data on health (75th round, 2018), shows that a deep-rooted downturn in the rural economy is making quality health-care unaffordable. People are availing of private hospitals less than they used to, and are moving towards public health systems. That is all very well except for the fact that the central budget 2020-21 lays emphasis on private provisioning of health care which will necessarily divert public investment away from public health infrastructure. The Ayushman Bharat Yojana links demand to tertiary in-patient care. This promotes earnings of under-utilised private hospitals, instead of modernising and up-grading public health systems in each district. We need to assign 70% of health sector budgets to integrate and strengthen primary and integrated public health-care services and systems up to district hospital levels, include out-patient department and diagnostic services in every health insurance model adopted, and implement in ‘mission mode’ the Report of the High Level Group, 2019, submitted to the XV Finance Commission.
The elderly population in India is projected to double from 8.6% in 2011, to 16% in 2040. This will sharply reduce the per capita availability of hospital beds in India across all major States, unless investments in health systems address these infirmities.
The policies that we adopt, and their effective implementation will ensure that the our demographic dividend, a time-limited opportunity, becomes a boon for India.
Meenakshi Datta Ghosh is Principal Author, National Population Policy, 2000, and former Secretary, Government of India