The Economics of Population Growth
November 20, 2005
While speaking at the release of "Religious Demography of India" brought out by the Centre for Policy Studies, a RSS affiliated think-tank based in Chennai, RSS Sarsanghchalak KS Sudarshan, exhorted Hindus to have larger families (teen se kam nahi, aap jitna jyaada kar sakein utna acha!). The immediate provocation for this somewhat drastic remedy to what he obviously considers a serious national problem is the rates of population growth of Muslims and Christians. That Muslims are growing at a faster rate than Hindus in independent India is well known. It has been so since 1951. In the decade 1951-61 Muslims grew at 24.9% while Hindus grew at 18.6%. In 1991-2001 the growth rate of Muslims after adjusting for the exclusion of Assam and J&K in the 1981 and 1991 Census's was 29.3%, while that of Hindus was 20.0%.
Not surprisingly the BJP and its like-minded allies have tried to stoke fears about Hindus being swamped by Muslims. That of course is a ridiculous notion for let alone present trends continuing, population growth of all groups in India will cease about the end of this century. It has been calculated that even if present trends continued it would take 247 years for Indian Muslims to catch up with Hindus in terms of numbers. Its not as if the RSS is not capable of getting its math right, but logic is not the issue.
To support its distorted inferences the RSS's has for a start considerably enlarged India. This one sentence in the preface of the book is a dead giveaway: "When we look at the data for the whole of India, including the Indian Union, Pakistan and Bangladesh, the new data only confirms the distinct possibility that Muslims and Christians together shall become the majority in the Indian region early in the second half of the twenty first century." So their India now includes Pakistan and Bangladesh? Or why not Nepal then? And even Sri Lanka?
The Chairman of the All-India Muslim Personal Law Board, Maulana Rabey Hasni Nadwi has on the other hand has categorically stated, "There is no room for family planning in Islam." He obviously is not inspired by the fact that in most proclaimed Islamic republics like Iran, Indonesia, Egypt, Pakistan and Bangladesh the governments actively encourage family planning.
Most demographers project that India's population growth will taper off around 2060. But the growth of population in the bimaru belt will continue till 2091. This rather appropriate acronym BIMARU stands for Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh. The Muslim growth will also level off about then, by which time they will constitute a good 18.8% of India. Given its political implications this could be a matter of concern in some quarters.
But what should equally be a matter of concern is the consequent implication that if the bimaru population keeps growing till near the end of the century, then the proportionate populations of other regions will actually be contracting. This may have even graver political consequences. But this does not seem to concern the Sangh Parivar, which seems only perturbed about Muslim fecundity.
A decade after liberalization not much has changed in India. About a third of our billion plus lives below the poverty line. And mind you the Indian poverty line, because of its emphasis on daily caloric intake is really the hunger line and not a poverty line that takes into account basic human needs. The GDP of India in 2003-4 was Rs. 2760025 crores growing from Rs. 9547 crores in 1950-51. This phenomenal growth also saw the share of Agriculture decline from 55.8% to 27.3%, while Industry grew from 15.2% to 24.6% and Services grew from 29.0% to 48.2%, making it seem that India is shaping up like a post industrial society without having really industrialized!
We know from experience that redistribution policies do not work well in practice. In 1994, almost a full quarter century after Garibi Hatao became the leitmotif of our economic policies, the Gini coefficient, which is the measure of income inequality, remained almost the same as in 1971 at 0.345. In 2003 the Gini has deteriorated to 0.378. The urban and rural inequality has also worsened. Worse, the inequality between the regions is alarming. There is a very clear divide apparent now in India with the Hindi speaking and eastern region quite visibly left behind.
The bimaru population is also growing at a much faster pace. The growth of population of the four southern states is less than half that of the bimaru states. True, the populations of Punjab, Haryana, Gujarat and Maharashtra are also growing at rates comparable with the bimaru four, but their growth in per capita income is comparable with that of the southern four. Don't jump to conclusions that if the population growth were to have slowed down, their per capita income growths could have been quite spectacular? On the face of it that may appear so, but it doesn't work that way.
At a macro-level, both, China and India have had a phenomenal expansion of populations combined with economic growth. Quite clearly population growth is not necessarily a brake on economic growth. On the other hand there is much to suggest that population growth contributes much to economic growth. The critical factor here is the dependency ratio, which is the ratio of dependent people aged 0-14 and 65plus against productive people in the 15- 64 years age group. The lower the dependency ratio the better. China currently has a more favorable dependency ratio of 450/1000 while that of India is closer to 650/1000. It is only in about 2020 that the Indian dependency ratio becomes the lowest in Asia, giving it the first real demographic opportunity to better the performance of today's high fliers.
Japan now is in the most difficult stage of its demographic transition. By 2020, the biggest segments of Japanese population will be in the above 65 years age group, with close to 15 million persons in just the above 80 age group making it the largest segment. To compound matters Japan's population will begin contracting. Much of Europe will face similar problems. By 2050 Russia will contract from 145 million now to about 90 million, whereas Italy will shrink to less than 40 million from 58 million now. It seems that among the major developed economies, only the USA will continue to have favorable demographics and economic growth. But by then the USA will be a nation where the Hispanics, Blacks and Asians will constitute the overwhelming majority, which might even make it a better country?
In 2020 India will have more than 270 million people in the 15-35 age segments, when productivity and economic contribution is the highest. If savings rates hold and with productive potential at its peak in 2020 and we will have a great window of opportunity to make it as a developed and prosperous economy by 2050 if we are able to educate and empower the masses. Such a demographic constellation will never appear again. It's just too bad our leaders are pre-occupied with their individual constellations, and not the nations.
There are other trends, some disquieting, also visible now. The foremost of these is the sharp increase in the numbers of Agricultural Laborers. This is the classification reserved for "the poorest of the poor." Their numbers has risen to 106.8 million in 2001 posting a decadal growth of 43.16%; almost double the 23.51% of the previous decade. This is a severe indictment of the policies pursued in the decade after the so-called liberalization. During this period the entire political spectrum enjoyed power and each formation equally vigorously endorsed the so-called liberalization. Naturally we will see no fingers pointed inwards.
But not all the RSS's concerns are unfounded. If economic conditions determine population growth, we must wonder as to why the growth of the SC and ST segments has remained below the Muslim growth trend? As opposed to the 29.3% decadal growth between 1991-2001 of Muslims, the decadal growth rate of SC's and ST's was 20.55% and 24.45% respectively. The household annual incomes as well as per capita incomes of the SC and ST groups are lower than that of Muslims. Muslims in turn are generally poorer than caste Hindus. Quite clearly there are segmental attitudes impacting upon population growth. Literacy levels of both rural and urban Muslims are lower than Hindus, but not by very much. Perhaps what is more significant is that as a percentage, more than twice as many uneducated Hindu women - 44% to 18% - are employed than similarly disadvantaged Muslim women.
The economic plight of rural Muslims is not very dissimilar to that of rural Hindus. As a percentage more rural Hindu households (51.2%) are landless than rural Muslim households (39.5%). But when it comes to larger holdings of over one hectare, the incidence of Muslims households with land is over twice that of Hindus. For instance in the 1-2 ha segment, 11.7% of rural Muslim households fall into this category while it is only 6% for Hindus. Even so the distribution of rural Muslims and Hindus by household monthly per capita expenditures remains about the same. It is only in the urban areas that the Muslims fare really poorly. About 40% of Muslim households have a per capita expenditure of less than Rs.425 per month. At the upper end 17.1% of Hindu households have per capita expenditures of over Rs.1120 per month as opposed to 5.8% for Muslims.
Finally here's something that should worry the Sangh Parivar no end. The proportion of caste Hindu's has been steadily dropping since 1961 when it was 61.97%. It is 56.05% now.