This article explains how a demographic profile of a country will impact the future prospects.

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Demographic profile of India:
Opportunity or Threat?
All through the study of economics the one common thing economists have frequently
talked about is the Population. This is one word which can make or break a country’s
prospects. In this article we have tried to capture different aspects of demographic
profile which will lead to India’s GDP growth, education, employment and also how it
will benefit the country in the long run.
Introduction:
It’s not a surprise that our country is a home to approx. 1.26 billion brothers and sisters
and this makes a country as a very complex economy. Despite late independence, we
managed to climb up in terms of economy. India currently has a GDP of USD 2.10
trillion, with a controlled inflation of 6.4%. Also with continuous improvements in
literacy rate (63%), we have focussed to reduce the unemployment rate to 9.6%
So with all these numbers around we want to present you with our case on why we
say that the demographic profile of India is an opportunity for us.
To understand this lets break up and focus on the points which support our say.
A) Young people and the Demographic Dividend
30% of our population ie. 364 million are in the age group of0-14 year and this makes
our country as the one with the world's largest youth population. This young groups
bring in a lot of challenges and responsibilities with them. To deal with a population of
this size is not a convenient task and that’s when we actually begin to start working on
issues around this.

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 Educate, else will be eliminated
In terms of education we are still way behind while comparing with ostentatious
countries like USA, Germany etc. A country like India needs to spend a substantial
percentage of its GDP on providing good quality education. If we look at the stats (as
per the census 2011 ), it’s appalling to see out of 63% literacy rate, only 24% of
people have completed primary education, 13.87% have completed metric and only
8.94% have completed graduation and above.
 Health should be healthy
Figures state that India has an infant mortality of 38/1000 whereas child mortality rate
of 48/1000.
Reasons for economic growth considering health as the start point we need to
understand that healthy children tend to have better records leading them to educated
workforce. Also healthy workforce is more productive and this population can save a
lot to centre’s exchequer especially in terms of medical costs. Not only this, a healthier
country also attract FDI’s, removes poverty and improvises the per capita income.
Key actions to realize a demographic dividend is by investing in the right resource. A
good investment today will yield a better dividend in the next 20-30 years. That was
the reason why we discussed on the above 2 points. These are the main cause of
concern for a developing country like us and the right quantum of attention to this will
bring in a drastic difference.
Programmes like Sarva Shiksha Abhiyan, National merit cum scholarship and interest
free education loans are a clear indicator that our investments are going in the right
way.
Any investment should be able to give a good dividend yield. Now that we have talked
upon on the investment what is the return we are expecting from this. Here is the
answer.
In the next 20 years the population which we have invested on (0-14 year) will become
the major part of the working population.

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 Working Population Trend
Why is the focus only on this group?
A country’s prospect can completely change by the way how it’s young creators,
innovators and thinkers radicalize the entire working environment. 43%, i.e 521 million
of our population is between the age group of 25 – 54 year and this population is the
backbone of our nation’s growth and this group is giving up to additional 1 % of their
contribution to the GDP.
Not only that, the employment rate or jobs created by this group is significantly high.
Over the recent years there has been a beehive of investments made in our country
and this is because of the positive co-relation that’s created between the numbers of
people employed within this age group.
Talking about the dividend we will have a better employment rate, increase in
government revenue, better development and good standard of living.
B) Other Factors
The way a country mobilises its savings also forms a very important point. The
dependency rate in our country is 1:3 which means for every one working individual
there are three dependants and these are above the age group of 60 years. Will this
be a burden for our nation? Not really, because the ratio stated here is still better when
compared to other nations who have a dependency rate of 53% of working population.
Also the habituation of Indians in terms of savings has been appreciated about. We
have well built pension schemes, gratuity, PFI which ensures there’s no pressure
that’s being built on this group.
Are we racing with other countries?
All these points stated here was to support the point how our country’s demography is
making way for the better. But this alone doesn’t mean that we have everything to

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sustain as a growing economy. On the flip side of the issue there are few deviations
which we need to concentrate and work upon and ignoring this can imply a serious
risk for our country.
Let’s take on the figures and compare with other countries to see how our country is
performing.
Parameter India China Brazil
Population 1,213,370,000 1,350,695,000 193,946,886
Per Capita Income $ 1,581.5 $ 7,590 $ 11,381.4
Going by the figure it’s evident that the working size of India is more when compared
to other 2 countries.This means we have the resource which we can build on for the
next 20 years but the real problem is are we efficient in using this. If we see the GDP
our country it’s the least amongst the 3 and the reason we can give is quality of this
working group. Of the 63% literate rate only 22% have completed graduation and are
able to actively contribute to the GDP.
These are the areas that needs to be worked upon-
1. Good Governance- We talk about the problems with big data and it’s
the same in case of census as well. The reason being most of our
policies and budgets revolve around the census number and credit
worthiness of the respondent is always doubtful.
Not only that a better functioning institution, efficient policies and
effective participation is also required.
2. A healthy labour market- With the recent hype with policies like Make
in India there has been a lot of investment flowing into the country which
has strengthened the labour market. The main attribute for this is the
labour market but the problem is how long can we carry this for.

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3. Macro-Economic policies – Concentrating on inflation, maintaining a
good Consumer Price Index, having a good reserve ratio, promoting
growth and maintaining a fair trade surplus are the efficient factors that
would support our demographical change.
4. Financial Markets – Not to be left behind, we still have a lot more to go
in terms of financial market. A competitive market attracts in more
investors and more FII investment will boost in the exchange rate. To
add on we need to bring in more complex instruments which would
actually raise our standards in the global economy.
Conclusion
The current demographic profile of India is certainly a benefit for our country. With
these points there are lot of opportunities that has been created.
 Demographic Dividend- Investment has been paced out in the right zone. This
would be a value added factor for the nation’s growth. The demographical
dividend will also show alongside the development of our country.
 Mobilizing Savings- As the number starts increasing, the mobilization rate also
picks up. For example consider the Jan Dhan Yojana Scheme. Within a year of
its start it has created a sum of Rs 30,796.46 crore. Then count on to what
impact this will create in the coming years.
 Entrepreneurship- A study says India needs to have a job creation of 10-15
million per year which would generate revenue of $200 billion and a creation of
10,000 start-ups over the next 10 years. To support this we need to have a
excellent business creation and a innovative entrepreneurial skill set and not to
be left behind we are already in the right phase.
 Financial Inclusion- Banking Sector one of the major contributors of territory
sector has seen an immense development in the recent years. Financial
inclusion, digitalization has helped to boost on the nation’s GDP and per capita
income.

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 Human Development Index- A better HDI means putting the country’s
prospect in a nutshell. Though the current ranking is on the grey side but the
improvement that’s been shown should be appreciated.
All these factors put in together gives the optimism in bringing on the demographic
connection alongside our nations endeavour in creating a better place for all.
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