Imperative alignment

In any country, an increase in the number of elderly people leads to a decline in savings, a decline in the labour force, a weakening in the return on investment, and a deterioration in the investment rate. India is a young country compared to the USA and China and will remain so for decades. The elderly population in India is projected to increase from 5.5 per cent in 2011 to 15.2 per cent by 2050 — when the elderly population will be 32.6 per cent in China and 23.2 per cent in the US.

The elderly in the USA

The USA is troubled by long life expectancy, a low birth rate, and high healthcare costs, resulting in a rapid increase in public healthcare expenditure. Consequently, there has been a significant reduction in the number of workers. The USA's reliance on other countries for workers has increased, and industries have also been negatively affected.

Ageing population in China

Due to the long-standing policy of limiting the number of children to one, the young population in China has decreased drastically, while the number of elderly people has increased significantly. As a result of the reduced labour force, both the economic and social conditions of the country are being negatively affected. In 1980, China implemented the one-child policy as a means to control the population.

Consequently, the economic and social structure of China is undergoing extensive changes. Children are becoming victims of despair and depression, and their upbringing is being compromised due to psychological reasons. Confidence among children is lacking, as they are observed attempting to escape competition. The financial situation of parents has improved due to having only one child, and the level of education has also increased. However, education has become more expensive in this altered environment.

According to the United Nations Population Department, in the next century, China's labour force is projected to be only 548 million. Additionally, estimates indicate that by the year 2030, there will be a substantial age gap within the population of China.

Effect of ageing in India

A complex situation may arise in the states of India concerning the elderly population. Data suggests that several states, particularly most of the states in South India, may experience an unprecedented increase in the elderly population. The World Bank predicts a population of 173 crores for India in 2050, with an estimated 27 crores being elderly.

When analysed on a state-wise basis, these numbers appear alarming. By the year 2050, one-fifth of the total population in four southern states — Andhra Pradesh, Kerala, Karnataka, and Tamil Nadu — will be elderly. Maharashtra, West Bengal, and Odisha also have a large elderly population. Northeast India is likely to witness a continuous labour exodus in the coming decades, as has been happening in these states over the past decade. On the other hand, states like Uttar Pradesh, Rajasthan, Assam, Bihar, and Haryana are expected to have a higher youth population by 2050, resulting in continued migration of youth from these states to the southern states.

These changes may also exert pressure on the infrastructure of the southern states, potentially leading to a ‘demographic crisis’. To prevent this, Andhra Pradesh has initiated efforts to encourage people to have more children. State-wise per capita income data reveals that the southern states are wealthier than the northern states, and there is a wide gap in the income of the two regions. By 2050, the elderly population in the southern states will further increase.

Conclusion

It can be asserted that the demographic changes in India are indicating a big crisis that requires timely action. As people age, there is an increase in savings, but there is also an increase in health expenditures. The reduction in savings also negatively affects the domestic products of the states.

By 2050, Andhra Pradesh will have the highest percentage of elderly population in the country, standing at 30.1 per cent. Kerala will have 25.0 per cent, Karnataka 24.6 per cent, Tamil Nadu 20.8 per cent, and Himachal Pradesh 17.9 per cent. On the other hand, Haryana will have the lowest proportion of elderly population at 9.8 per cent in 2050.

Considering the shifting demographic trends, it is imperative for the states of the country to formulate and implement appropriate policies. States with a younger population should establish labour-intensive industries to effectively utilise the young workforce, while states with a large elderly population should consider increasing the retirement age. Nonetheless, it should be noted that India's social and economic policies differ from those of China and the USA. Nevertheless, a policy can be developed in favour of the common people in our country. Aligning policies with the demographic changes in the states may yield more favourable outcomes in this regard.

Views expressed are personal