According to a report by People’s Bank of China (PBoC), China’s Central Bank, India’s Demographic Advantage (% of Younger Population) will overtake China’s Demographic Advantage by 2035.
- The reason for the fall in China’s Demographic Advantage is due to its strict Birth policies, which has created the problems of ageing population and a declining work-force.
- The report has called for China to liberalise its birth policy to tackle the problem of ageing population, it has to compete with a demographically young India & US (which has a young population due to immigrants).
- India has one of the youngest populations in an ageing world. Around 90% of its population are under the age of 60, out of which ~ 35% is under 19 years old.
Highlights from the report
The report states that the economic gap between India & China is narrowing.
- The labour force of India will exceed China’s by hundreds of million in the coming years.
- By 2050, India will have a large percentage of young population with larger workforce and greater growth potential beyond 2050.
- The report states that the US will benefit from its immigration policies, which will ensure that it has a strong & abundant workforce.
China’s Birth Policies & its effects
i.China followed a one-child policy for 3 decades. It was only in 2016 that it started implementing the two-child policy.
ii.Impact of one-child policy for China:-
- The population of citizens over the age of 60 increased to 420 Million in 2019.
- China’s population will reach its peak in 2025, after which it will enter negative growth after 2025. Negative growth means more deaths than births or even number of deaths and births.
- The negative growth will result in shortage of consumer demand.
India’s population is ~ 1.37 Billion, while China’s population stands at ~ 1.44 Billion.
Recent Related News:
i.June 24, 2020, According to the World Bank Data under the International Comparison Program (ICP),India retained its position as the third-largest economy in terms of purchasing power parity (PPP) for 2017 , China (16.4%) and US (16.3%) ranked 1st and 2nd respectively.
About People’s Bank of China (PBoC)
Governor – Yi Gang
Headquarters – Beijing, China
Established Date – December 1, 1948