G.’s Blog

India’s Demographic Advantage?

Posted by G. on February 6, 2010

I keep hearing about India’s demographic advantage as a means for economic growth. Here’s Jim Jubak at MSNFinance, giddy at the thought that India will only have 6.7% of its population above the age of 65 by 2020.

As a counter point, I would like to submit that Abhyasthavidyarude Thozhilillayma (the problem of unemployment among the highly educated) was a popular essay topic in language classes and competitions back in school in the 80’s.

Population is only one resource among many required for economic growth. In fact, I would rate it towards the bottom of the scale when compared to some of the other ingredients (natural resources, innovation, nature of society etc.). It is also a double-edged sword – without proper utilization, its quite easy for a population to overrun the resources of the land.

I would think India’s diversity would be a much more important factor for growth in the long run. Because of the multitudes of languages and cultures that we accept as part of “us”, it becomes a lot easier to accept changes, even if they are of the disruptive variety. And as long as these diversities dont create a break down of the Indian Union, this provides a genuine competitive advantage compared to monocultural societies like Japan and Europe.

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2 Responses to “India’s Demographic Advantage?”

  1. Ilya said

    Yes, but the point being made is not an absolute one but rather a relative one: when compared with China (which is about to face major demographic problems) and the developed world, India’s population growth leaves with a major advantage. They may use, they may squander it but it is a resource rather than a liability.

  2. G. said

    Agreed, but my argument was that we should not be extrapolating the demographic data to automatic conclusions of wealth creation.

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