Sunday, 5 May 2013

                                                      POPULATION VS ECONOMY

The debate of population and economy dates back to Malthus. According to Malthus with increasing economic growth population increases with higher fertility and lower mortality. On the other hand increasing population under constant input such as land translates into lower marginal productivities and thereby reducing economic growth. This theory created quite a stir in England in the 19th century but the population and the economy continued to increase proving the Malthus theory to be wrong.

As we have seen that the various results of the demographic transition models pertaining to mortality and birth rate are directly linked to per capita income of a nation rather than aggregate output. Here when addressing, the often asked question is the suffiency of the food grains for the population. This as the economists observe is a question of whether the people can buy rather than the whether adequate presence of food grains. When people earn money they could import food grains from various developing countries selling them.

Another question of how population increase would pressurise institutions like education and intensify the foreign exchange constraints by placing more pressure on balance of payment. Here the concerns are about how the pressure would result in the fall in standards of education which would end in fewer enrolments and drop outs are very true in a developing country like India.

But what higher working population would result is a very large labour force with less minimum wage and thus encouraging labour based industries.This larger labour force would result in economic development of country and also reduces the problem of unemployement.According to demographic transition model every country has this window of opportunity called demographic dividend.

The demographic dividend is a window of opportunity in the development of a society or nation that opens up as fertility rates decline when faster rates of economic growth and human development are possible when combined with effective policies and markets. The drop in fertility rates often follows significant reductions in child and infant mortality rates, as well as an increase in average life expectancy. As women and families realize that fewer children will die during infancy or childhood they will begin to have fewer children to reach their desired number of offspring. However, this drop in fertility rates is not immediate. The lag between produces a generational population bulge that surges through society. For a period of time this “bulge” is a burden on society and increases the dependency ratio. Eventually this group begins to enter the productive labor force. With fertility rates continuing to fall and older generations having shorter life expectancies, the dependency ratio declines dramatically. This demographic shift initiates the demographic dividend.”

India’s population is expected to cross China’s population in 2025.Most of this population is going to be in working age group resulting in the demographic dividend for India. Though this provides a window of opportunity of development,It also challenges us of how India will be able to provide basic food and water to all it’s population.

There are four stages of development in demographic dividend. First the increased labour supply. Though this is dependent on how government will be able to grasp available work force. Next the increase in savngs.As the number of dependents decrease there will be an increase in saving resulting in the economic boost. Next is the increase in the human capital. As there are less children parents invest more on each resulting in better education and health outcomes. And finally is the growth in domestic demand due to increased per capita income and less dependency ratio.

As we can see that the first mechanism is a root for a countries development during demographic divedend.So government has to come up with policies that would increase the opportunity of employment with which there could be a social chaos. The Right To Education Act is definitely one policies towards the right direction if implemented properly.

Indian Case:

he International Labour Organisation has predicted that by 2020, India will have 116 million workers in the age bracket of 20 to 24 years, as compared to China’s 94 million. This demographic fact has the potential to be the biggest competitive advantage of India in the years to come.

As we know that education is of utmost importance and since adapting adopting RTE, we have achieved a gross enrolment ratio (GER) in primary education of 104 per cent. The challenge, however, is sustaining these rates of enrolment into higher education. In that arena, we stand nowhere near the global GER of 29 per cent, with a historically low GER, currently at 18 per cent.

And so to tackle the question of employement, Government of India has proposed to create 100 million jobs by 2022 in its 12th five year plan.

Demographic transition developed by an American demographer Warren Thompson observes changes in the birth and death rates in industrialized societies over previous 200 years. But like all models the demographic transition model has its limitations.

  • It does not consider the influence of migration. Both immigration and emigration.
  • There is no time scale present. 
  • The death rates in Germany and Sweden are higher than the birth rates indicating that there might be a fifth stage present.
  • It does not consider the effect of female literacy and employment on population.
  • Based on the change in population of UK and might not be applicable for all the countries.
  • Influence between countries like war is not considered. 

Stages of Demographic Transition:

As we can see in the above figure there are four stages:

Stage 1- High Fluctuating Period:

  • Both death rates and Birth rates high.
  • Lack of disease control, famine, poor hygiene lead to very high death rates.
  • The need for more man power and many religious beliefs lead to high birth rate.
  • As both death and birth rates are high the increase in population is less in this period.
Stage 2 – Early Expanding: 

  • Various medical science advances in this period lead to decrease in Death rate with birth rate being the same.
  • This resulted in increase in population in this era. 
Stage 3 – Late expanding:

  • Birth rates are decreased due to various factors such as government policies, increasing cost to raise a child, higher literacy among females contributed to this.
  • Here the population is still increasing but the rate of increase has been reduced. 
Stage 4 – Low Fluctuating:

  • Both birth rates and death rates are low and of the same value resulting in the stabilization of the population. 

Uses of DTM:

  • It helps us to predict the future population of a country and how it would change overtime.
  • Comparison between two countries can help us find out how economic and social conditions might affect the population. 


A population pyramid, also called as age picture diagram, is a graphical illustration hat shows the distribution of various age groups in a population which forms the shape of a pyramid when the population is growing.

Above is the population pyramid of the world in 2010.The features of a population pyramid are 

  • Male figures are to the Left of the pyramid and female figures are to the Right of the pyramid. 
  • The horizontal axis may either represent the actual number or the percentage of the total population in each age category. 
  • The vertical axis is divided into various age groups known as Cohorts. 

Uses of a population Pyramid:

  • The division between the sexes can be analyzed. 
  • A wider base indicates a higher youth population as a result of high birth rates. 
  • A narrow top indicates that there are fewer people in older age group as a result of low life expectancy. 
  • Dependency can be calculated knowing the population pyramid. 
  • A Column shaped population pyramid indicates a nation in stage 4 of demographic transition with equal death and birth rates. 
  • The level of immigration can also be shown in the population pyramid.

India's Demographic Stats

Data from SRS and Census are widely used for assessing on going demographic transition in the country. Census provides data once in ten years. The Sample Registration System (SRS) was established in order to provide dependable annual, state-specific data. The SRS was initiated by the Office of the Registrar General, India on a pilot basis in a few selected states in 1964-65. It became fully operational during 1969-70.

A comparison of some demographic parameters between India and some of the neighboring countries is given in Table 2.1. China and Sri Lanka are far ahead of India in all these parameters.

Some Demographic Parameters : India and It's Neighbors 

Time trends in some of the major demographic indices are shown in the following table.

India - Selected Health Indicators

Demographic Transition in India

Population Projections

The population pyramids for 2001 and 2026 are shown in the figures below. The average age of Indians was 23 in 2001 and is expected to rise to 31 years old in 2026.

Projected population (India 2001)

Projected population (India 2026)

The substantial interstate differences in age structure and consequently population pyramid will persist even in 2026 because different states have achieved fertility and mortality transition at different rates. These have to be taken into account while planning nutrition and health interventions in these states.

Projected population (Kerala 2026)

Projected population (Uttar Pradesh 2026)

The results of the last two censuses, especially the findings of the 2011 Census, clearly indicate that the country has entered the last phase of demographic transition, usually characterized by rapidly declining fertility. The crucial question now is — how long will this phase extend and when will India achieve a stable population?
“People are realising that we cannot forever continue to multiply and subdue the earth without losing our standard of life and the natural beauty that must be part of it. These are the years of decision- the decision of men to stay the flood of man."  Ehrlich here explains the one of the most pressing problems facing man in the 20th century. The population of the world is increasing daily with a growth rate of about 1.2 % . Science and medicine have decreased the death rate exponentially while the birth rate has not decreased so. According to The United States bureau of census, the world population is presently about 7.2 billion with a potential of becoming 10 billion by the end of the century. Most contemporary estimates for the carrying capacity of the Earth under existing conditions are between 4 billion and 16 billion. In 100 years, the population could be well over the earth's carrying capacity.

Overpopulation has become one of the many concerns of any country. It is giving rise to various problems from inadequate fresh water, depletion of natural resources to increasing pollution and deforestation. Mass starvation is inevitable if population continues to increase the way it is currently. The existing grain is getting used up at the rate of knots and the rate at which the population is growing, it will be impossible to supply food and water to this increasing population. It creates unemployment; as the population keeps on increasing the job opportunities keep on diminishing. The rich-poor gap is increasing, creating the potential for large parts of the population to starve. Low level of per ca pita income reduces the purchasing power of the people making them poor and unable to educate their children resulting in lower standard of living.

Though one may argue that population matters for economic development of a country and it is, but we need to make sure that economic development does not come at a cost of our future generation’s lives. With about 1.24 billion of 7 billion population (17.7 % of the world population) it is clear that India has to take steps in reducing the growth rate of population alongside with increase in standards of living and sustainable environment. It is estimated that by 2050, India will overtake China to become the most populous country.

Fig: Population: India and the world.

For many years concern has been voiced over the seemingly unchecked rate of population growth in India. The most recent census indicates that some success is being achieved in slowing the rate of population growth.  However, the progress which has been achieved to date is still only of a modest nature. Moreover, in a country like India which has so huge a population base to begin with, a slowing of the rate of population growth may not be enough.

Thursday, 25 April 2013

The "Dependency Ratio" Dilemma

The number and proportion of elderly population in India is increasing very fast. Though in comparison to the developed countries the India’s population is still young. But in absolute term India is the second highest elderly populated country after China. 

The dependency ratio is an age-population ratio of those typically not in the labor force (the dependent part) and those typically in the labor force (the productive part). It is used to measure the pressure on productive population. The dependent part usually includes those under the age of 15 and over the age of 64. The productive part makes up population in between, ages 15-64. It is normally expressed as a percentage. The (total) dependency ratio can be decomposed into the child dependency ratio and old-age dependency ratio. Old age dependency ratio is defined as the number of persons older than 64 per 100 persons in the age-group 15-64 years. Child dependency ratio is the ratio of younger dependents--people younger than 15--to the working-age population--those ages 15-64. 

Population ages 0-14 (% of total)

The Population ages 0-14 (% of total) in India was last reported at 30.21 in 2011, according to a World Bank report published in 2012. Population is based on the de facto definition of population.

Population ages 15-64 (% of total)

The Population ages 15-64 (% of total) in India was last reported at 64.79 in 2011, according to a World Bank report published in 2012. Population is based on the de facto definition of population.

Age dependency ratio (% of working-age population)

The Age dependency ratio (% of working-age population) in India was last reported at 54.34 in 2011, according to a World Bank report published in 2012.

Old age dependency ratio (% of working-age population)

The Old age dependency ratio (% of working-age population) in India was last reported at 7.71 in 2011, according to a World Bank report published in 2012.

Child dependency ratio (% of working-age population) 

The Child dependency ratio (% of working-age population) in India was last reported at 46.63 in 2011, according to a World Bank report published in 2012.

Today more than fifty percent of aged persons in India are surviving below the poverty line and more than 80 percent of the elderly are depending on others especially children for their day today activities. The increasing dependency ratio brings more economic pressure on working population. As the ratio increases there may be an increased burden on the productive part of the population to maintain the means of livelihood of economically dependent.

All the above images of graphs have been taken from the following sources:

Thursday, 21 March 2013

On the path to Replacement Level Fertility

The results of the last two censuses, especially the findings of the 2011 Census, clearly indicate that the country has entered the last phase of demographic transition, usually characterized by rapidly declining fertility. 
The U.S. Census Bureau predicts that India will surpass China as the world’s largest country by 2025, assuming that China does not alter its current fertility policy. But India's population will also be more youthful than China's with a large proportion of those in the working age category. India is in the third phase of demographic transition and has fertility rates that have declined significantly from previously high levels. But it is yet to reach the population-stabilizing "replacement level" of 2.1 children per woman. 

Replacement level fertility is the number of children a woman should have to replace herself and her mate for a stable population, and it has been fixed at 2.1 globally. A stable population is that where fertility and mortality are constant. 
As per the National Population Policy, the set target for India to obtain stable population is 2045, for which the replacement fertility level of 2.1 was to be achieved by 2010, which has not happened. The crucial question now is — how long will this phase extend and when will India achieve a stable population? 

The provisional Census 2011 figures show that all four south Indian States — Andhra Pradesh, Karnataka, Kerala and Tamil Nadu — have already achieved the replacement level fertility of 2.1 children per women required to initiate the process of population stabilization, while the four large north Indian States — Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh — have still a long way to go before they achieve the required level.

The achievement of the 2.1 rate in these states is because of several reasons such as high literacy rate, education about family planning, availability of contraceptives, life style improvement and empowerment of women. As per the latest NFHS-3 data, the use of reproductive and child health as well as family planning services is very low in these northern States as compared to the four large southern States. The state government in these four northern states should use the media and also give assurance to the public about these services.

Friday, 8 March 2013

India's Population and Family Planning Policy

In 1952, India was the first country in the world to launch a national programme, emphasizing family planning to the extent necessary for reducing birth rates to stabilize the population at a level consistent with the requirement of national economy.We two, ours two ("Hum do, hamare do" in Hindi) is a slogan meaning one family, two children and is intended to reinforce the message of family planning thereby aiding population control. All forms of modern mass communication media plus traditional cultural media were used to develop social support for the idea of the small family. After 1952, sharp declines in death rates were, however, not accompanied by a similar drop in birth rates. The National Health Policy, 1983 stated that replacement levels of total fertility rate (TFR) should be achieved by the year 2000.

In general, direct efforts on the part of government to promote family planning have had only limited success in India. In large part this has been due to the factors which have traditionally operated in Indian culture and society to promote large families. Initial policies which formed clinics expecting that the people would come out on their own failed due to deep rooted tradition and the need of people for the labor. It was in the 1960’s where the mode of population policies had changed from clinics to home visits by family planning workers to bring awareness among people. Despite these efforts the population of India continued to grow at an alarming rate which led to the establishments of infamous sterilization camps in 1976-77 but the political situation of the country along with the widespread negative publicity made the government to suspend the sterilization program.

Here, however, it might be noted that the most common family planning modes have proven difficult to implement under Indian conditions. Where government efforts are concerned, only three methods are advocated: sterilization (vasectomy for fathers and tubectomy for mothers), IUDs and condoms. Sterilization has traditionally met with strong resistance among uneducated sectors of the population who associate it with loss of femininity As it is often irrevocable, it has been a source of concern in a society where couples who may already have several children risk losing some or all of them as a result of such factors as epidemics, earthquakes or floods.

In regard to IUD, which has been promoted since its introduction in India in 1963, the method has not proven popular because of the relative frequency of excessive bleeding and involuntary expulsion (which is less frequent). Taking note of the fact that in traditional Indian society gynecology, obstetrics and other fields requiring intimate contact and conversation with women are invariably reserved to female doctors only, the real problem is the lack of sufficient numbers of dedicated women physicians who are willing to work in rural areas and spend some time in pre-insertion and post-insertion follow-up of their patients. The third major mode of contraception-condom use has seen a marked increase in usage in India in recent years; however, much of this increase has been due less to family planning concerns but to fear of AIDS.

Government is offering incentives for families accepted for sterilization. Facilities offered by government to its employees are limited to two children only. Only those with two or fewer children are eligible for election to a Gram Panchayat or local government.

With National Population policies in 2000 India came up with many targets and objectives for the future. They are
  • To fulfill the unmet need for the contraception, strengthening the health infrastructure, and integrating services for reproductive and child health. 
  • Effective implementation of inter sector strategies so as to reduce the TFR of India by 2010. 
  • To sustain economic growth, Social development, Eco conservation and stabilize the population by 2045. 
Though India has set a target of 2.1 for TFR by 2010 we are still at a national average of 2.6 and 12 states have already reached the target of 2.1. A new initiative had been launched in 2010 in which contraceptives will be delivered door to door by community health workers and substantial amount of $12 billion had already been spent over the past 7 years by our government for improving health infrastructure.