Paul C.

(a) Oh my God! The Chinese have made a mistake OR (b) Demographic Dividend of India (c) Experts of the nineteenth and twentieth century thought India's population will make India - the luckiest country of the twentieth century. OR the country quite simply a disaster of epic proportions. By the mid twentieth century, Neo Malthusian prophets were sounding the alarm on the disastrous population growth in India and China, and predicted that the impact of such growth would felt around the world. In 1960 India had consumed one - eighth of America's total wheat production and by 1966 it had grown to one - fourth. As the global panic around population growth surged, Indian government began executing measures of family planning in the 1960s. During the Indian emergency era of 1975-1977, the government of India managed to conduct eight million sterilizations. Dr. P.V. Mehta, a Gynecologist entered the Guinness Book of World Records for sterilizing more than 350,000 people in a decade. He performed forty sterilizations in an hour. A common grouse in India is how slow we are to reforms, adapt and change, especially compared to our neighbor China. Democracies are slow, they are also more cautious than autocracies, and this makes them less prone to committing truly enormous errors. China, however, was marching to a different tune. It was during Malthus's life time that socialism and communism came to China. At first the Chinese leaders argued that "socialism could support any level of population- the more the merrier." Marx even dismissed Malthusian theory as a school boyish, superficial plagiary. But by the end of 1970s, the Chinese government was also bitten by the population panic bug. In 1981 the Chinese Supremo Deng Xiaoping told his officials "Just do it - implement it in any way and by any means". The result - "coercion for a good cause" as described by the PRO of Deng Xiaoping. By 1980 the world had noticed the enormous success of the family planning programme of China. But tings have turned upside down. Malthusian scientists have predicted that by the year 1975, there will be mass death in India and China and population will resort to Cannibalism. But 1975 came and gone. Nothing happened. Intellectuals laughed at Malthusians. Academics then began to re-examine population in terms of it's effect on economic growth. By these time India's working-age population grew nearly four times faster than it's dependent population. The working population spent only little money on their non-working parents. This situation enabled them to save more money themselves. Thus larger working population has helped the country's savings rate as proportion to of GDP to 34% in 2008 and is set to rise to even higher than 40% by 2015. Such savings created additional capital for investment across the economy. Particular kinds of population growth could dramatically drive the country's growth and not impede it as economists used to believe. The Harvard Demographer David Bloom calls this particular effect as "Demographic Dividend". When Demographers went and looked back at previous periods of sustained growth in Europe and America, they found that they coincided time and again with similar patterns of large numbers of young people and fewer dependants. Europe and America experienced this dividend between 1970 and 2000. The population of America, Europe and East Asia are now graying, growing older. Where are the young now? The answer is quite simple - In India and not in China. I write again "Not in China". The idea of Population control was and is not workable in democratic India. But autocratic China did it. China's highly effective family planning policy now look like a case of winning the battle, but losing the war. The Chinese have made a mistake!!! The one thing that made the population story of India and China so different finally was India's slow-moving, frustrating, yet highly reactive politics. China, of course reaped it's dividend between 1970 to 2010. It is over for China now. The rate of working people was two and half times that of non- working dependants. But not now. The arc of dividend that normally takes a century in other countries to complete has taken place in China in less than forty years. The dependency rate is now set to explode. China is becoming grey before it became rich!!. By 2040 the world's second largest population after India will be China's pensioners, over 400 million people. The one child policy has created 4, 2, 1 population structure in China, four grandparents, two parents and one child. This has resulted in fewer young workers and below replacement-level birth rates since 1990s. This one young man or woman does not have any Aunts, Uncles or Cousins. An incredibly alien notion is now a Chinese reality!! And the one Child who is a little Emperor will have it's social adversities. China now has a ratio of 855 girls to 1000 boys! By 2026 men will have no women to marry. President Jacques Chirac worried aloud "Europe is vanishing. Our Countries will be empty. We have old people, living in old homes, ruminating about old ideas". India's dividend is going to last longer. India has started to experience the demographic dividend since 1980 and it will take until 2035 to peak. By that time India will have added over 270 million people to the working population (including my Son who is six years old now). Both demography and democracy joined their hands to give India its gift - "Impressive and sustaining Economic development". Today, India's growth story is increasingly the story of its young population. India's economy is the most dynamic in terms of it's human capital. India has one of the youngest populations in the world, with median age of 23, (including my Son who is 21 now) at a time when the rest of the world has already started graying. Since independence, India which struggled for decades with it's policies that tried to put the lid on it's surging population now look it's billion in the eye and says - Bravo. With the current GDP growth, our human capital has emerged as a vibrant source of workers and consumers not just for India, but also for the global economy. The challenge of maintaining wealth in ageing societies means that developed markets will have to increasingly outsource their labor requirements. In 2020 India is projected to have an additional forty seven million workers, almost equal to the total world shortfall. India produces two million English speaking Graduates, 15,000 law graduates and about 9000 PhDs every year. And the existing pool of 2.1 million engineering graduates increases by nearly 300,000 every year. India's exploding global, IT led services economy is impacting more business processes than we thought possible. There is one unusual case: on-scene news reporting. Indian reporters watch conferences by video and typed up news reports for a US paper. Un believable!?? As a result the world market for offshore IT services and business processes has already tripled since 2001. It is now estimated to be a $300 billion opportunity. But we have so far captured only 10%. But we are now uniquely placed to capture this market fully. Few months ago President Obama declared that he will not allow tax concessions for American companies and corporations who outsource work. He may take some time to realize that American companies and corporations have no choice other than to outsource. A billion people will offer us a deep base of Human Capital, but it also signals a potentially massive, detrimental burden on our environment, food production and resources. Millions of people will join the middle class and will ramp up their consumption and per capita intake of energy is definitely going to go up. We will have to find solutions for these concerns. Dr. APJ Abdul Kalam did write a notice to the Politicians of India. "The line between firmness and harshness, between strong leadership and bullying, between discipline and vindictiveness is very fine, but it has to be drawn. Unfortunately, the only line prominently drawn in our country today is between the heroes and the zeros. On the one side are few hundred heroes keeping nine hundred and fifty million people down on the other side. This situation has to be changed". I do not know how many politicians understood what he wrote. He again says for the politicians to read: If you want to leave your footprints On the sands of time Do not drag your feet