Demographic Shift: India Surpasses China in Population

In a transformative demographic shift, India is projected to surpass China as the world's most populous country in 2023, a change that will have notable economic implications. In 1990, both countries exhibited pyramid-like demographics, indicating a higher birth rate among the youth compared to the aging population. However, as projections suggest, by 2050, China's demographic profile is expected to mirror a funnel, reflecting a stark contrast where the aging population increases significantly. This year marked a historic moment for China, which announced its first population decline since 1961. Contributing to this decline is the low fertility rate of just 1.3—still an outcome of the one-child policy. Though this policy was reversed in 2016, its effects persist, leading to a demographic crisis stemming from a severe gender imbalance and an aging population. While China's birth rates struggle to meet the 2.1 replacement rate necessary for stability, India’s population continues to grow, projected to peak at 1.7 billion by 2063, thanks in part to a larger reproductive age demographic. This demographic difference poses significant challenges for both nations: China faces a looming worker-to-retiree gap, escalating societal burdens on youth, while India wrestles with the creation of job opportunities for its burgeoning young workforce. The global economy's dependency on China is under threat; fewer workers may result in diminished manufacturing output and reduced consumerism, especially as the aging population swells. India, while enjoying a young labor force, must focus on urban development and employment opportunities to harness this demographic advantage.