Kolkata: Demographic dividend may be a thing of the past, sooner or later. And it’s high time Indian policymakers start preparing for an increasing number of elderly people. The companies, which have been eyeing consumer demand from India’s young population, will have to rework and reframe their strategies for the long run as well. At least that’s what the government’s Economic Survey, tabled in Parliament on Thursday, suggested.
According to the survey, there will be an estimated population of 239.4 million Indians over the age of 60 in 2041 against 104.2 million in 2011. It said that the number of children in the 5-14 age bracket will decline significantly, leading to the need for school mergers and less focus on building new ones. There is an imminent need to raise the retirement age also, it suggested. The current retirement age for most government workers in India is 60.
While India should be benefitting from the so-called ‘demographic dividend’ over the next decade as its working population is set to increase by about 9.7 million a year between 2021 and 2031, that will quickly fade as the nation’s fertility rate plunges below replacement level, the survey said.
Interestingly, the demographic dividend that is talked about in India refers to the current situation where the nation’s labour force is growing quicker than the rest of the population it supports. If the newcomers to the labour market get well-paid jobs it boosts consumption and economic growth.
Already states like Himachal Pradesh, Uttarakhand, Andhra Pradesh and Madhya Pradesh have fewer than 50 students enrolled in more than 40 per cent of their elementary schools, according to the study, which was included in the government’s annual Economic Survey.
It also said that policymakers need to prepare for an increasing number of elderly people, estimating there will be 239.4 million Indians over the age of 60 in 2041 against 104.2 million in 2011.
The latest study authored by India’s Chief Economic Adviser Krishnamurthy Subramanian and his team of economists, said, “This will need investments in health care as well as a plan for increasing the retirement age in a phased manner.”