A decade for youth to make India a developed Nation
Contd from previous issue
PROJECTION: Dr Bibek Debroy, Chairman, Economic Advisory Council to Prime Minister Narendra Modi, projects that India will grow comfortably at a real rate of 7.5% to pass through the upper-income category and approach the high-income status by 2047. Dr C Rangarajan, former Chairman, Economic Advisory Council to Prime Minister, calculates that India would need to grow at a real rate of 6.18-6.74% to achieve the status of a higher-income country by 2047. Both economists arrive at similar numbers though they take different starting figures and currencies to project their calculations in their papers on macroeconomic essentials.
The fact is that India does not have the luxury of just 3-4 decades to economically grow,but only 1 decade or 10 years to achieve the goal.
Among the talk between, “world largest and youthful work force and demographic dividend”, one major talk or point missing is MEDIAN AGE GROUP. India’s fight is against no one but with itself, where it is ticking like a time bomb.
WHAT IS A MEDIAN AGE GROUP?
The median age is a statistical measure that represents the age at which exactly half of a given population is older, and half is younger. It is a measure of central tendency and is often used to understand the age distribution within a population. The median age is expressed in years.
For example, if you have a population of 7 people in your family and their ages are as follows (in ascending order): 19,21,25,48,50,71 and 75.
The median age in this case would be 48, because it’s the age at which exactly half of the population is younger than 48, and the other half is older than 48.
The median age is useful for demographic analysis and can provide insights into the age structure of a population. It’s often used in conjunction with other demographic indicators to understand population trends, plan for services and infrastructure, and make policy decisions. For example, a country with a high median age may need to plan for an aging population with healthcare and pension needs, while a country with a low median age may focus on education and employment opportunities for its youthful population.
YOUNGEST NATION BUT LIMITED WINDOW FOR GROWTH:
The median age of India’s population is 28.2 years, data from the World Population Prospects (WPP), which forms the basis of the UNFPA report released. This makes the average Indian 10 years younger than the average Chinese whose median age is 39 years,which makes India the youngest nation in the world.
But, India’s young demography will not remain young by 2036 and the proportion of people below the age of 24 will fall to 34.7% by 2036 from over 50% in 2011. And the median age of Indians will jump 10 years to almost 35 by 2036, with some 13 large and industrialized states like Maharashtra, Tamil Nadu, Punjab and Andhra Pradesh expected to have even a higher median age of its people than the national average. Economists and experts believe India has a limited window to harness its human capital and absorb it in the workforce, and argue that the projected ageing of the population will have several consequences—the demographic loss, the low productivity in the labour market, an increasing share of dependence in socio-economic life, and need for a wider social security coverage among other things.
Anoop Satpathy, a labour economist and faculty at V.V. Giri National Labour Institute said “We must cease the opportunity in this limited window. For that we have to categorize the young Indians into three buckets—those who are in education, those who are either employed and unemployed and, third, those who are neither pursuing education nor looking for employment. I believe we will have a sizable portion of youth in the third bracket who will need to be gainfully employed in jobs or businesses,”
“While improving quality of education and skilling is one part, transition from schools to workspace need to be faster. Now it takes longer. For that we have to create opportunities in new growth areas. Government is looking at electronics and mobile manufacturing, its growth area, similarly deep technology, solar, core manufacturing can help the people and the economy. An ageing population will have an impact on labour productivity. But, we are not like some of the developed nations and the impact will be gradual. Here you need a wider and robust social security net,” Satpathy said.
Arup Mitra, a professor of economics at Delhi University, said very soon the so-called demographic dividend possibility will dissipate. “To cease the last bite of the possible benefit, a great deal will have to be done for skill formation, plus we have the problems of labour absorption at the advent of the fourth industrial revolution,” said Mitra. “The pandemic has created additional problems of livelihood loss. In such a situation, upgradation of skill, on-the-job training are essential along with massive investment in all the three key sectors —agriculture, manufacturing and services,” he said.
WHY MEDIAN AGE IS IMPORTANT FOR ECONOMIC GROWTH?
Data from the population projection report by a technical committee under the health ministry shows that while the median age of Tamil Nadu will be 40.5 years, it will be 39.6 both in Kerala and Maharashtra, 39.5 in Himachal Pradesh, 38.9 in Punjab and 38.8 in West Bengal.
The relationship between a growing economy and a decreasing fertility rate is a complex one and is influenced by various social, economic, and demographic factors. As economies grow, the cost of living tends to rise. This includes expenses related to housing, education, healthcare, and other essentials. The financial burden of raising children in such an environment can lead couples to have smaller families. As women gain more access to education and employment opportunities, they often have greater control over family planning decisions. Empowered women may choose to have fewer children or delay childbearing to pursue other goals. As per the fifth round of National Family Health Survey NFHS conducted by MoHFW during the year 2019-21, the Total Fertility Rate (TFR) has declined to 2.0 children per woman from 5.8 children per woman during 1970.Because of decreasing TFR,the median age is increasing rapidly.
The contribution to the economy by age varies significantly depending on factors such as the individual’s level of education, skills, employment status, and industry. However, we can provide a general overview of how different age groups contribute to the economy:
· 0 to 17 years: where a person completes academics.
· 17 to 22 years: where a person start his career
· 25 to 30 years: where a person starts to earn and contribute to the economy.
· 30 to 35 years: where a person seeks growth in his/her career. And give his best effort.
· 35 to 40 years: where a person is at the peak of his/her career. And take greater risk for a better future.
· 40 to 60 years: where a person focuses more on his family,saving and taking fewer risks. And start planning for his/her retirement.
· 60 and above: where a person wanted to spend his/her life with family. Where contribution to the economy is negligible with some exceptional cases.
Hence, Using the median age of a country’s population, including the median age of India, is important for several reasons when considering the growth of the economy and formulating economic policies.
To be contd