Will India get old before it gets rich?

Like most of the world, India is witnessing a sharp fall in population growth. One of the factors driving it is the deep decline in fertility rate (number of children women of child-bearing age are likely to have). But unlike most of the world, the fall in fertility rate in India hasn’t accompanied a sharp rise in per capita income. This raises the possibility of the country greying before reaching the prosperity level of countries with similar age profiles.

Per capita income of countries when they reached fertility rate of 2.3

At 2.3 fertility rate, India’s per capita income was 1/4th to 1/5th the level of rich countries

Many states with lower than national fertility rate of 2.2 in 2017 are nowhere near rich countries’ per capita incomes

In 2017, India’s fertility rate had fallen to 2.2


How fast should India’s per capita income grow for it to become ‘rich’ in the next 20-30 years?
To get to China’s current per capita income (chart below), India’s income will have to rise by 8.8% every year for 10 years. But China isn’t yet a rich country. It’s an upper-middleincome country with per capita income only about a quarter of high-income countries. To reach US’s current level of income, India's per capita income needs to grow by 23% year-on-year for 10 years — an impossibility.

To be sure, India isn’t going to age in the next 30 years. Though the share of 0-19 age group in population has peaked in most states, share of 20-59 age is still rising.

A combination of low inflation, high GDP growth and a stable or appreciating rupee could turbo charge India’s per capita income.