Answer: According to United Nations Population Fund “The demographic dividend is the economic growth potential that can result from shifts in a population’s age structure, mainly when the share of the working-age population (15 to 64) is larger than the non-working-age share of the population (14 and younger, and 65 and older)”. 

India entered the demographic dividend phase around 2010, when the share of the working-age population was about 51 per cent, and will continue to enjoy the benefit till 2056, with the ratio projected at 54 per cent. 

If the demographic dividend of India is used productively, it can boost growth. According to a CII report, India’s demographic dividend can help improve GDP from the current $3 trillion to $9 trillion by 2030 and $40 trillion by 2047. But, unless the work of skilling, reskilling, and job creation happens, India risks frittering away any demographic advantage.

Demographic dividend of India can become a demographic curse  

• Poor Skilling: Skilling initiatives over the past decade have not kept pace with population growth, leaving a massive skills gap.   

• For example, barely one in five Indians in the labour force is “skilled” (Human Development Report (HDR) 2020). 

• Unemployment: Educated and skilled youth are also finding it difficult to find employment. 

• For example, 24% of those between 20 and 24 years of age are looking for jobs. 

• Dependency ratio: In some decades the population will age, and demographic dividend will fade away. 

• For example, India’s old-age dependency ratio will rise to around 35 per cent in 2050 from the current 19 per cent. 

• Health: Poor health represents low educational and professional prospects in later life. 

• For example, more than one-third of children (35.5%) are stunted and more than half (57%) of women in the age group of 15-49 years are anemic in India (NFHS-5). 

• Shift from the primary Sector: Demographic dividend realization means a shift of workers from the primary sector to secondary and tertiary sectors of the economy 

• For example, the farm sector’s share in the country’s employed labor force was at 45.5% in 2021-22 compared to 42.5% for 2018-19 (Periodic Labour Force Survey). 

Tapping the workforce potential for economic growth is closely tied to access to healthcare, quality education, productive employment opportunities and more. Experts have long advocated a skills strategy based on the three Es--education, employment and employability. Unless enough jobs are created and there are workers equipped with the skills for them, the demographic dividend risks becoming a liability.