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Is our young population a dividend or a disaster?

Is our young population a dividend or a disaster?
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First Published: Thu, Aug 16 2007. 12 48 AM IST

Ifzal Ali, chief economist at the Asian Development Bank, says India faces an employment problem that could spark social unrest and a tumble in growth rates
Ifzal Ali, chief economist at the Asian Development Bank, says India faces an employment problem that could spark social unrest and a tumble in growth rates
Updated: Thu, Aug 16 2007. 12 48 AM IST
New Delhi: Eighteen-year-old Rahul Banerjee left his home in poverty-struck eastern India dreaming of a job at a fast-food eatery in Delhi—but in today’s booming times, employers want a high-school diploma.
With just a primary school certificate, Banerjee, one of a growing army of young workers that Indian policymakers hail as the country’s “demographic dividend,” fears all he will find is employment as a servant. “I need more education but there was no chance,” said Banerjee, who left school at 10 when his father died so he could help his mother run their small farm plot.
Ifzal Ali, chief economist at the Asian Development Bank, says India faces an employment problem that could spark social unrest and a tumble in growth rates
India celebrated 60 years of independence on Wednesday with a staggering 51% of its population of 1.1 billion people under 25 and two-thirds under 35. Experts say India’s “youth bulge,” seen lasting until 2050, could turn out to be its greatest asset—or a demographic disaster if the government fails to provide education and jobs for its burgeoning workforce.
India has hit the “tipping point” where the huge number of young workers entering the labour force could unleash major economic gains by boosting savings and investment, experts say. China made a great economic leap forward when it reached that point in the early 1980s. Now a greying population resulting from Beijing’s one-child policy could slow its growth by 2030, economists say.
“India is on the cusp of a demographic dividend,” Nirupam Sen, India’s UN representative, said. By 2020, the average age of an Indian is expected to be 29 years, compared with 37 for China and 48 for Japan.
“The energy and vibrancy of youth, the fact their reach exceeds their grasp, their capacity for risk-taking and innovative ideas gives the cutting edge to India’s economy, science and technology,” Sen said. But lack of education and job opportunities and proper health care could erode or eradicate this rosy scenario, experts warn.
“The biggest challenge is educating and skilling such a large, youthful population. Rural education, health care and infrastructure are vital,” said Deepak Lalwani, director at London brokerage Astaire and Partners. “Social cohesion may well be affected if economic gains are not more inclusive and provide jobs and raise living standards,” he said.
With India’s working age population set to hit 761 million within the next five years, the nation faces an employment problem that could spark social unrest and a tumble in growth rates from current levels of 9%, warns Ifzal Ali, chief economist of the Manila-based Asian Development Bank. Some 60% of the demographic bulge will occur in five of India’s poorest and worst governed states such as Bihar and Uttar Pradesh. Already ultra-leftist rebels known as Naxalites are present in 14 of India’s 29 states and run parallel administrations in many of them.
“An unskilled, under-utilized, frustrated young population will derail economic growth, undermine harmony and breed violence,” warned prominent civic activist Jayaprakash Narayan, based in Hyderabad. On the key education front, India’s report card is abysmal. The education system is mired in corruption with test papers for sale and a teacher absenteeism rate of 25% that is the second highest in the world, behind only Uganda, according to a new Unesco report. Literacy levels lag many developing countries, including in sub-Saharan Africa. China’s literacy rate is 90.9%, Kenya’s is 85.1% while India’s is 65.2%. Rampant child malnutrition poses another threat. Some 46% of all Indian children under three years old are malnourished.
“Their physical and mental development is stunted,” said Nisar Ahmed, who helps run an intensive infant feeding centre in Madhya Pradesh where 60% of children below three are malnourished.
Already, the World Bank estimates malnutrition lops two to three percentage points off India’s annual growth due to such factors as lower productivity. The population growth could “transform into a demographic dividend if every child was born healthy and was educated,” said health minister Ambumani Ramadoss.
A former finance ministry bureaucrat Vijay Kelkar said, “If we miss this opportunity (to tackle these problems), then we’ll be in the dire straits of being a poor, aging country.”
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First Published: Thu, Aug 16 2007. 12 48 AM IST