Development challenges

Implications of India's declining fertility rate

The latest official birth rate data indicate that fertility is declining at a faster rate than expected, implying that India will reach the point at which population stabilises a little earlier than anticipated. The numbers compiled through the Sample Registration Survey conducted by the Registrar General of India show that the overall fertility rate (the average number of children borne by a women in her lifespan), which was 3.6 at the beginning of the 1990s, has come down to just 2.3 in 2013 - a mere 0.2 points short of reaching the "replacement rate" needed to maintain the population at more or less a constant level. At current rates, the country can hope to reach peak population somewhere between 2020 and 2022, rather than in 2025 as was projected earlier. Essentially, the crude birth rate (CBR) - the number of births per 1,000 people - has dropped to 21.4 in 2013, a perceptible fall of 0.2 points in a single year. Predictably, it is the highest in Bihar (27.6) and the lowest (14.7) in Kerala. Just nine states, mostly in the north and east, have not yet reached the replacement level of 2.1; in at least eight states the average number of children per family has gone down below two.

This is the result of several factors. The government officially stopped fixing family planning targets way back in 1996, but states continued to offer cash incentives to women for undergoing sterilisation, and are also holding mass sterilisation programmes. It is a sad reflection on female empowerment that more complex female sterilisation programmes are being held rather than the simple vasectomies. That said, however, the real reason for the decline in the fertility rate is economic. Economists argue increasing prosperity and public health reduce the need to have more children to ensure security in old age. Also, the global experience is that higher female literacy - a proxy for general female empowerment - is associated with fewer children per family.

The implications of a sustained shrinkage in the fertility rate are many and quite far-reaching. At present, a younger India has an advantage over the ageing West. Nearly half of the country's population is below the age of 25 and more than 65 per cent under 35. Indications are that in 2020 India's average age will be 29, compared to 37 in China and 48 in Japan. However, this demographic dividend can be capitalised upon only if these young people are educated, healthy and employable. Seen this way, the challenges during the current demographic transition phase seem even more daunting. Not only must education and health standards be raised substantially, the rate of employment generation, too, needs to be increased to keep pace with growing demand. The existing wide disparity in the quality of life in urban and rural areas needs to be reduced to enhance the employment chances of rural youth as well. The demographic dividend will not last as long as expected. So there is no time to lose, if India is to take advantage of it. Education and labour reform must happen immediately.