Chief Economic Adviser V. Anantha Nageswaran on Tuesday called for building a sustainable and inclusive pension ecosystem as India has a limited window to prepare for an ageing population and achieve universal pension coverage by 2047.
Addressing a conference on “Sustainable Pension Systems: A Socio-Economic Imperative to Viksit Bharat”, organised by the Pension Fund Regulatory and Development Authority (PFRDA) and the Institute of Actuaries of India, Nageswaran said pensions are a long-term promise that must be backed by strong institutions.
“India is young today, but it will not stay young. The working-age advantage is a window, not a permanent condition. We have a finite period to build the architecture that an ageing society will lean on,” he said. He said a nation cannot be considered truly developed if economic growth is not accompanied by financial security for its elderly citizens.
Nageswaran said India’s pension discourse must now move beyond encouraging savings to addressing the challenge of decumulation-converting retirement savings into a stable income stream that lasts throughout a person’s lifetime.
“Getting money in is one task. Turning a lifetime’s savings into predictable income that lasts as long as a person does is a different and more demanding task,” he said.
Highlighting the risks associated with longer life expectancy, Nageswaran said retirement planning should balance flexibility with income security rather than relying on a single financial product. He called for retirement solutions based on Indian mortality and morbidity data instead of imported models.
He also stressed that pension security and healthcare should be viewed together, warning that rising medical costs could undermine retirement savings.
“A retiree may have saved enough to live and still be undone by medical shocks of later life. Pensions and health security are not two files, but one problem seen from two sides,” he said.
Nageswaran said achieving “Pension for All” by 2047 would require sequencing, coordination and scale, especially for India’s vast informal workforce and the growing gig and platform economy.
He said the rollout should begin with simple and portable pension accounts, followed by contribution mechanisms suited to irregular incomes and then supported through incentives and behavioural nudges.
The CEA highlighted the role of India’s digital public infrastructure in expanding pension coverage, saying technology can enable low-cost micro-contributions and make retirement planning easier through artificial intelligence and analytics.
However, he cautioned that technology cannot replace public trust.
“Trust is the scarcest input in any pension system because people give up money today in exchange for a promise that matures decades later,” he said, adding that regulators must ensure pension products genuinely serve savers’ interests, particularly in private pension plans.