Unleashing the populace
NEW DELHI: On many metrics, China maintains an economic edge over emerging manufacturing rivals like Vietnam and India.
Boasting of superior infrastructure, Beijing has long-standing private sector relationships that it can rely on for years to come.
However, India has primed itself to give China a run for its renminbi in terms of human capital or population. India is now set to surpass China and become the most populous nation globally in 2023.
As per the World Population Prospects 2022 study compiled by the UN Department of Economic and Social Affairs, Population Division, India is set to have a population of 1.668 billion by 2050, which is higher than China’s expected population of 1.317 billion by the middle of this century.
China’s population had declined for the first time since 1961, owing to a plunging birth rate. Its demographic crisis deepened in 2022 as population dropped by 8.5 lakh to rest upon the 1.4118 billion mark, the National Bureau of Statistics (NBS) said.
These developments are transpiring when China’s economic growth has also plummeted to its second-lowest in five decades, as it registered a three per cent increase in 2022.
China’s decline in population is a fallout of its decades-old myopic one-child-policy, implemented in the 1970s and scrapped in 2016. The policy prevented 400 mn additional births. However, China’s rapidly ageing population and the demographic transition from an agrarian to an industrial economy also contributed to this decline. As living expenses shot up, people were less inclined to have children.
Apart from the revised third-child policy implemented in May 2021, Beijing has initiated a range of stimulus measures to boost population growth. Several cities, provinces and regions have introduced incentive schemes like issuing subsidies to families with a second or third child.
However, population scientists affirm that the experience drawn from Europe and Japan tells us how hard it is to inspire a shift in mindsets and reverse such declines with fiscal incentives and government campaigns.
Analysts observing the working-age population of China surmise that it is a big challenge for a country to avoid a scenario where it grows old before it turns prosperous.
In terms of age structure, China’s working-age population between 16 and 59 is estimated to be 875.56 million, which accounts for 62 per cent of the national population. The population of those aged 60 or more hit 280.04 million, which was 19.8 per cent of the total population. As per estimates, this number is set to rise to 30 per cent, or more than 400 million people by 2035.
On the other hand, World Bank data says that India’s working age population is 68% as against the global average of 65%. But, there aren’t enough people employed in the workforce as just about 46% of India’s potential labour force is active in the job market, compared to nations like Indonesia with 68%, and Vietnam with 74% of its eligible population employed in the workforce.
India must take advantage of being one of the youngest nations globally. Making the most of its population dividend requires the administration to tick off many items on the checklist. The creation of a business-friendly milieu that inspires investors to set shop here is imperative to drive employment generation. India must also aspire to improve indices pertaining to the quality of life without which all such mobilisations could falter.