India headed for a population divide? Younger north and Elder south in making

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Published: January 9, 2019 3:07:37 PM

While India is a young nation compared to China and US, a recent report by SBI predicts that the country might be heading towards a population divide by age within, with a younger North and an elder South.

 Southern states are more prosperous than their northern counterpart with the per capita income gap between Karnataka and national average being Rs 57,000, the report said.

While India is a young nation compared to China and US, a recent report by SBI predicts that the country might be heading towards a population divide by age within, with a younger North and an elder South. This might not affect India being an overall young nation but might lead to the southern India facing extreme pressure in terms of social and physical infrastructure in the coming decades, the latest SBI EcoWrap report said.

India is the second largest nation by population and it is estimated that its population will exceed China’s population by 2024. World Bank estimates that India’s population will be around 1.73 billion by 2050, as opposed to current 1.32 billion. Of these 173 crore people, 27 crore will belong to the elder population, aged 65 and above.

Also read: India set to become third-largest consumer market, says WEF; these factors to drive consumption growth

While this might not look like an alarming number, one-fifth of the population in four southern states — Andhra Pradesh, Kerala, Karnataka and Tamil Nadu — will be elderly people. States such as Maharashtra in the west, and West Bengal and Odisha in the east are predicted to face the problem later as the larger of its population will be on the verge of turning old.

Age old issues

The problem arises as it is expected that the gap between asymmetric income distribution will widen with the increase in the elder population. Currently, southern states are more prosperous than their northern counterpart with the per capita income gap between Karnataka and national average being Rs 57,000, the report said.

It added that an increase in the elder population leads to a drop in savings, and a decline in the labour force leads to a fall in return on investment as well, which reduces the investment rate.

The report said that this might have implications on inter-mobility of labour from east and northeast India to the south and sometimes western India. Uttar Pradesh, Rajasthan, Assam, Bihar and Haryana are expected to have a younger population in 2050 thus labour forces might find southern states lucrative enough to migrate there.

This can cause a high demand for infrastructure both physical (transport, communication, sewage, water supply etc) and social (schools, hospitals, universities etc.) in southern states.

Also, there could be an impact on the state domestic product as more people will be living on their pensions and savings. An innovation in bank schemes will be expected from the banks as they will be catering to age groups with different needs.

  • By Prachi Gupta

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