The Median Age in India: 26

By Adam Freedman | July 2, 2012
  • What's Happening

    What's Happening

    India's economy is on the rise, expanding by almost 9 percent last year alone. It has more people than any country except China, and its population is young and growing fast. Yet investing in India carries "political risk" -- the chance that an investment will be harmed by, say, a change in government, institutional interference or corruption. For much of its modern history, in fact, India has been hamstrung by a bureaucratic, centrally planned economy riddled with corruption. Overbearing business regulation and a nearly institutional tradition of bribery are so woven into the economy that they've taken on a collective nickname, License Raj, or bureaucratic rule.

    Photograph by Brent Lewin/Bloomberg

  • Why It Matters

    Why It Matters

    India's great hope may be in its demographics. Compared with many other countries -- especially developed ones -- its median age is young at 26 vs. 35 for China and 37 for the U.S. Its average life expectancy of over 62 is on a par with Brazil's. Agriculture still accounts for more than 15 percent of its GDP and about half of its jobs. Only 30 percent of its population is considered urban. India's stock market is also more diversified than those in many emerging markets and is the only one among the four BRIC nations with a substantial technology sector. There's room for tremendous development, in other words.

    Graphic by Charlos Gary/Bloomberg

  • What It Means for Your Portfolio

    What It Means for Your Portfolio

    While India and China are often paired as emerging-market giants with explosive growth, India has lagged China in recent years in no small part because China has been so much better at developing its infrastructure. India has also failed to keep inflation in check, one of the reasons India's Sensex index is down about 10 percent from a year ago. Even though the Reserve Bank of India cut rates by 0.5 percent in April, investors have been hoping for further cuts, which could boost stocks. The central bank, however, has been reluctant to do it again, which means that even with its appealing demographics, Indian stocks will likely remain under pressure.

    Photograph by Brent Lewin/Bloomberg

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