Popular literature often touts India as an industrial powerhouse, supplemented by its large consumer base stemming from its sheer population size. With an estimated population of 1.23 billion as of the quarter ended March 2014, India bears the distinction of being one of only two countries with more than one billion citizens (the other, being China, is somewhat larger with 1.36 billion). India’s vast population exhibited modest growth of 1.64% annually during 2001-2011 (according to the 2011 Census; its population far outstrips second runner-up (in terms of population size), United States (with a population estimated at 317 million). Given its diverse and dynamic nature, India’s demographic merits a closer examination, both to identify potential growth opportunities and possible problems associated with it.

Gender Gap Divide

The emergence of several high profile cases of sexual assault and violence against women has cast the spotlight on gender discrimination in India. The general preference for male offspring has tended to skew the gender ratio in favour of males. The male-to-female ratio stood at 1.06:1 in the 2011 census but is as high as 1.62:1 in the Union Territory of Daman and Diu and as low as 0.92:1 in Kerala. Gender ratios are higher in urbanised areas (1.08:1 compared to 1.06:1 in rural areas), although the imbalance has improved given the 1.11:1 male-female ratio exhibited in the 2001 Census. Overall, India’s male-female ratio has declined from 1.078:1 to 1.072:1 according to the 1991 and 2001 surveys.

Subtle, gender discrimination reduces India’s ability to fully harness its population to enhance its production capacity and promote economic growth. This point is further exemplified by the relatively low female participation in the labour force. Labour force participation stood at approximately 25.3% and 15.5% in 2012 for rural females and urban females respectively. These figures stand out in stark contrast to the 55.3% and 56.3% rural and urban male labour force participation rates.

Employment-Population Linkages

India’s population is relatively young, with a median age of approximately 23.9 years as of the 2011 Census. This presents India with both opportunities and challenges in the future. On the one hand, a young population is generally supportive of future economic growth, especially in the context of human capital development. Leaving aside the future problems associated with population ageing, a young population provides India with the required labour force to support further economic expansion. The supply of young labour also gels well with India’s aspirations to position itself as a premier provider of Knowledge Process Outsourcing. However, despite its massive potential, the government faces the uphill challenge of providing the necessary infrastructures for supporting its expansion and fostering job creation.