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Opinion | India’s demographic dividend will play out over a longer span

Devender Singh
The window of demographic dividend points to a differential approach to socio-economic policy planning

A study on demographic dividend in India by United Nations Population Fund (UNFPA) throws up two interesting facts. One, the window of demographic dividend opportunity in India is available for five decades from 2005-06 to 2055-56, longer than any other country in the world. Second, and more interesting, is the fact that this demographic dividend window is available at different times in different states because of differential behaviour of the population parameters.

Demographic dividend is said to be occurring when the ratio of the working age population is high and the dependency ratio in terms of proportion of children and elderly people low. This advantage can create the space needed to increase investments in enhancing human capabilities, which, in turn, can have a positive influence on growth and development.

Graphic by Kaveen Kumar Saini/Mint

At present, India, overall as a country, has a large proportion of population that is young as shown in chart 1. Close to 30% of India's population is in the age group 0-14 years. The elderly in the 60-plus age group are still a small proportion (8%) of the country's population. The working age group 15-59 years accounts for 62.5% of India's population. The working-age population will reach the highest proportion of approximately 65% in 2036. These population parameters indicate an availability of demographic dividend in India, which started in 2005-06 and will last till 2055-56.

The story gets interesting when we look at the sub-national picture. The demographic dividend is not available in all the states at the same time. This is because different states have behaved differently in the past and are projected to behave differently in terms of population parameters in future also.

To start with, the fertility decline across states and regions has been different. Some states, especially in southern India, started seeing the fertility decline earlier than other states, especially the states in the hinterland. This created regional variations in the degrees and timings of fertility decline. A clear pattern of demographic divergence has emerged in India. When all the states in India are mapped in terms of fertility levels, one sees a predominantly youthful north and a maturing south and west. In brief, it could be said that the demographic transition in India is staggered. Some states have very low total fertility rates, of, say, 1.6 children per woman, while there are other states that are hovering around the replacement level of 2.1. On the other end of the spectrum are the states that still have very high fertility, near or above 3 children per woman.

The permutations and combinations of population parameters have given rise to different age and sex structures in different states. In UNFPA's study, one can clearly see three sets of states, which will have their windows of demographic dividend available at different time periods as shown in the figure above.

The first set of states are in the southern and western parts of India and includes Kerala, Tamil Nadu, Delhi, Andhra Pradesh, Telangana, Gujarat, Punjab and West Bengal, where this window of demographic dividend opportunity is about to close, in the next five years. Then there are states where this window will remain open for another 10-15 years and include Karnataka, Odisha, Himachal Pradesh, Maharashtra, Jammu and Kashmir, Assam, Uttarakhand and Haryana. The third set of states includes the high-fertility states in the hinterland of India-Chhattisgarh, Jharkhand, Madhya Pradesh, Rajasthan, Uttar Pradesh and Bihar. The window of demographic dividend opportunity is yet to open in these states. These states will have demographic dividend opportunity even in the 2050s and 2060s.

The key finding of the study is that states will have their demographic dividend opportunity at different times because of the staggered nature of demographic transition. As a result, India will enjoy a longer span of demographic dividend because, as the window closes in some states, it will open in other states. This is an important finding as it can guide the socio-economic development policy planning according to the age and sex structures in states or a set of states.

Accordingly, UNFPA advocates a differential approach in forward-looking policymaking and programme planning to harness the demographic dividend opportunity. For example, the focus in the states where the window is closing soon will have to be on ageing and migrant-friendly policies and programmes, while the focus in the states where the window is open and will close in the next 10-15 years will have to be on empowering girls and women, provisioning of health, education and skill development for young people, and employment generation. The focus in the states where the window is yet to open will have to be threefold-addressing harmful practices such as child marriage, access to quality sexual and reproductive health services and family planning services to all, and provisioning of health, education, life and vocational skills to all the young people.

Fine-tuning the planning and implementation of schemes and programmes by factoring in population dynamics is likely to yield greater socio-economic impact and larger benefits for people.

Devender Singh is national programme officer (population and development), United Nations Population Fund (UNFPA)