Sanjeev Ahluwalia | Too many people: Think before you have a baby…

An India, more populous than China this year, and growing to 1.66 billion people by 2050, is touted as good news by the United Nations Population Fund (UNFPA), an agency which monitors population trends and its implications for the global economy. Most Indians, though, have mixed feelings about adding 240 million-odd people to what is already a large and tough to sustain population.

Indians, in general, perceive a dearth of opportunities relative to their aspirations. They worry that the available amount of land cannot sustain a growing population. Migration for work, within the country, is a way of life. A staggering one-fourth relocate from their place of birth. The demand for overseas jobs is limited only by the extent to which advanced economies grant visas.

Most developing countries are similarly constrained. UNFPA notes that the majority of citizens in Brazil, Egypt and Nigeria feel the same, despite these countries being far less densely populated.

India has a population density (number of people per sq km) of 470, compared to just 26 in Brazil -- although conserving the Amazon eco system reduces the availability of land for development, 108 in Egypt -- but their land is far less fertile than India’s, and 228 in Nigeria, an oil producer. The UNFPA terms this fear “Population Anxiety”.

High population density induces a fear of further population growth: Densely populated regions and countries are right to feel anxious about population growth. South Asia with 395 people per sq km, is the most densely populated global region, which includes Bangladesh, the most densely populated large country in the world, at 1,286 people per sq km, and India. East Asia and the Pacific has a lower population density of 96, with South Korea at 531, Japan at 346 and China at just 150. Compare this with the European Union at 112, Sub-Saharan Africa at 48, Latin America and the Caribbean at 32 and North America at an even lower 20 people per sq km.

Population growth -- mostly an outcome of successful development: UNFPA is optimistic about the increasing global population – now eight billion and counting – because population growth implies that we are also getting better at maintaining peace and stability, providing health and education, and reducing poverty in the developing world, where population growth is highest. On the flip side, sadly, population growth is also related to low gender empowerment. “44 per cent of partnered women are unable to make their own decisions over their health care, contraception and whether or not to have sex. Nearly half of all pregnancies are unintended”. Just one quarter to one-third of women in low- and middle-income regions manage to stick to their plan for the speed and number of children.

In the advanced economies, development liberated women. Higher shares for women in the workforce and the ensuing higher economic power, translated into falling fertility rates. For population growth to slow in developing economies, women must be liberated from social prejudices which curtail their rights versus men -- often embellished by public policy, religion or custom. Gender equity would mean fewer babies being born, more living beyond infancy, more benefiting from early nutritional adequacy and growing into more productive adults.

A conditional yes for babies: Today, international opinion abhors the seemingly “quick wins” solution, adopted in the second half of the previous century, to cull population growth, via involuntary (state sponsored) sterilisation and abortion. China severely regulated the birth of children and disincentivised population growth. It outpaced India in GDP growth since the 1980s, under the economic reforms of Deng Xiaoping, though the growth impetus appears to have petered out since 2014. In contrast, India did not actively curb population growth after 1975-77 and grew slower than China, though growth has converged after the Covid-19 pandemic. There is no causal link between slow population growth and high GDP growth. The latter is associated with multiple factors. Nevertheless, incentivising population management to fit the available public resources, remains a reasonable policy objective.

That this approach is actively followed worldwide is illustrated by the first response of advanced economies to economic downturns, which is to clamp down on in-migration.

No free lunches for labour: Of the three inputs into economic growth, investment can be considerably financed by private debt -- the most easily available financial resource. Innovation led productivity, another growth input, is better facilitated by venture capital finance, in turn driven by the prospects of supra normal profits, as in start-ups. But labour must add enough value from the start, to pay for their salaries and for future pensions. If the workforce productivity is low, as in India, the government has to provide basic income support and build skills over time. This leads to the medium-term circular problem that poor

economies have low tax revenues. Scarce government resources cannot provide fully for quality public services, resulting in low and unequitable growth and continuing poverty.

Technology generates only high-quality jobs: An added complication is that the ongoing technology revolution creates far less new jobs than the ones it makes redundant. This is how “productivity gains” are often wrongly measured -- more output per worker. It also tilts the jobs market towards those with higher productive skills. The income constraints on households is best illustrated by household savings in India (a loose proxy for well-being) declining from 23.7 per cent of GDP in 2012 to 17.15 per cent by 2018.

Medical science and technology are enhancing the productive longevity of humans and redefining the earlier association of negative economic consequences with a “greying” population. Add to this the fracturing globe. Capital remains mobile but large scale, incremental migration of people seems unlikely -- reducing overseas jobs for people from worker surplus economies.

Finally, the threat of climate change requires a drastic rollback in carbon and other GHG emissions -- which have anthropogenic roots. Climate threats can induce large-scale domestic migration from coastal erosion, desertification, or chronic water scarcity to safer areas. This will increase the population pressure in already high population density Asian nations, including India, as the liveable land area reduces.

Making the existing global population more productive remains the critical, unachieved, objective. We know that today’s global consumption levels are not sustainable if they are extended to all eight billion humans on a sustainable basis. The transition to decarbonize consumption could span half a century. Till we achieve global climate stability, encouraging the young to think before becoming a parent is fairly sound advice.