Health expenses are likely to rise significantly in States with ageing populations.. File
| Photo Credit: The Hindu
The story so far: The Chief Ministers of both Andhra Pradesh and Tamil Nadu expressed concerns about the low fertility rates in their States recently. Andhra Pradesh Chief Minister N. Chandrababu Naidu has said that he planned to introduce legislation to incentivise more children per family.
What is the current demographic situation, especially in the southern States?
After decades of family planning policies seeking to slow population growth, India has been waking up to the fact that the success of such policies is also leading to an increasingly ageing population. This is not a uniform phenomenon — southern States, as well as smaller northern States have seen a much sharper decrease in total fertility rates, defined as the average number of children born to women during their child-bearing years. Tamil Nadu and West Bengal, for instance, recorded fertility rates of 1.4 between 2019 and 2021, according to data from the Office of the Registrar General of India, while Andhra Pradesh, Telangana, Kerala, Punjab, and Himachal Pradesh had fertility rates of 1.5. At the other end of the spectrum are Bihar, with a fertility rate of 3, Uttar Pradesh (2.7), and Madhya Pradesh (2.6). States with lower fertility rates have largely developed faster, but are now faced with the spectre of a rapidly ageing population.
The India Ageing report published by UNFPA last year used Health Ministry data to show that while the share of India’s elderly population is projected to rise from 10.1% in 2021 to 15% by 2036, the demographic transition is more advanced in some States. In Kerala, senior citizens accounted for 16.5% of the population in 2021, a figure that is set to rise to 22.8% by 2036; T.N.’s elderly will make up 20.8% of its population in 2036, while it will be 19% in Andhra Pradesh. In Bihar, on the other hand, only 7.7% were elderly in 2021, and this is projected to rise to just 11% in 2036.
What is the likely economic impact?
“India’s demographic transition is much ahead of its socio-economic transition… To understand the impact of this, the most important indicator is not the proportion of the elderly population, but rather the old age dependency ratio, that is, how many older people are there for every 100 people of working age, between 18 to 59 years,” says Srinivas Goli, an Associate Professor at the International Institute for Population Sciences. “When this ratio goes above 15%, that is when you have the onset of an ageing crisis.” A number of States have already crossed this point, according to projections by the National Commission on Population, with Kerala having an old age dependency ratio of 26.1 in 2021, followed by Tamil Nadu (20.5), Himachal Pradesh (19.6), and Andhra Pradesh (18.5). This means these States’ window of opportunity, to reap the demographic dividend of economic growth from a large number of young workers unburdened by the economic and health demands of a large number of minor or elderly dependents, has already closed.
Health expenses are likely to rise significantly in States with ageing populations. One analysis of NSSO data, in a study on demographic diversity by Tulane University’s K.S. James and IIPS scholar Shubhra Kriti published by The India Forum, shows that the southern States, with just one-fifth of India’s population, spent 32% of the country’s total out-of-pocket expenditure on cardiovascular diseases in 2017-18, while eight Hindi belt States with half the country’s population, spent just 24%.
The solution proposed by the Chief Ministers of increasing the fertility rate is also likely to reduce women’s participation in the labour force, which will also hurt their economies. Southern politicians have also raised concerns with the Finance Commission that while their successful economies have pumped in higher tax revenues to the central pool, they get a diminishing share of the central pie of resources due to their slowing population growth.
What are the political implications?
Uneven population growth is set to shake up the federal structure, with the current freeze on the number of seats in Parliament set to expire in 2026, after which a new delimitation exercise will change the representation that States have in the Lok Sabha. The study by James and Kriti estimated that Uttar Pradesh is likely to gain 12 seats, followed by Bihar (10) and Rajasthan (7), while Tamil Nadu is set to lose nine seats, followed by Kerala (6) and Andhra Pradesh (5), due to their falling share in national population.
What are the solutions being considered?
The southern CMs seem to be advocating pro-natalist policies by incentivising women to have more babies. “This has not been a very successful approach internationally. Educated women know they are not reproductive machines, and forced fertility will not work, nor will incentives that do not recognise what families actually need,” says Dr. Goli. He recommends changes in work-family policies, with paid maternity and paternity leaves, accessible childcare, and employment policies that reduce the “motherhood penalty”. He notes that States and nations with better gender equity are better able to maintain fertility rates at sustainable levels, as women are more likely to have children if they will not be deprived of economic independence while doing so.
Another approach is to increase the working lifespan and thus reduce the old age dependency ratio. The southern States are already magnets for economic migrants. However, Dr. Goli points out that though these migrants make social security demands of their destination States, they continue to be counted in their home States for political and financial distribution purposes, leaving southern States in a difficult tangle.
Published – November 10, 2024 03:50 am IST