Can soaring population give India an edge over China?

Bruce Einhorn

India’s population is exploding and is likely to surpass China as the world’s biggest within a few decades. In a country where more than 25% of the people live in poverty, is that a good thing? One of the top executives at India’s premier pharma company seems to think so. Last week Brian Tempest, the former CEO and current “chief mentor” at Ranbaxy Laboratories, told an industry gathering that the growth of India’s below-25 population “is going to act as a secret weapon in the future,” according to this report in the Hindu. Tempest went on to take a jab at China, saying that slower Chinese population growth would put the Middle Kingdom at a disadvantage. Says Tempest, “the one-child policy in China will play a spoilsport.”

The logic is simple. Fast population growth equals more young people, and more young people equals a more dynamic work force. According to the Indian Express, citing India’s Ministry of Labour and Employment, India already has an advantage over more advanced economies. The median age in India in 2000 was 24, compared to 30 in China, 38 in Europe and 41 in creaky old Japan.

However, most of those Indians live in the countryside, and it’s no secret that India’s rural population is not sharing in the boom enjoyed by people in other parts of the country. In the past, Asiatech blog readers have written in to debate the merits of India’s development model versus China’s, and the topic of population growth has come up a lot. I’m no fan of China’s one-child policy, and I definitely am not advocating that India adopt anything like it. (Aside from the obvious human-rights problems associated with the policy, some experts argue that the slowdown of China’s population growth came before it even went into effect. For instance, see this article from the New England Journal of Medicine.) Given what happened when Indira Gandhi tried to take action to control the population, it's also understandable why lots of Indians oppose the idea of the government getting involved now to keep the growth rate down. Maybe there is nothing that politicians can do to slow India’s march to be No. 1 in population. But if the Indian economy is really going to benefit from all those young people in its population, policymakers should at least focus a lot more on the problems of rural India.

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