Need more migration to sustain ‘ageing’ peninsular states, says Subramanian

According to the CEA, in the last 15 years, poorer states in India have grown slower than the richer states

DEMOGRAPHIC DIVIDEND

AT A time when many economically progressive states and cities are battling “anti-outsider” sentiments, Chief Economic Advisor (CEA) Arvind Subramanian on Friday said that India needed more migration to sustain all the “peninsular states” and West Bengal, that have a rapidly ageing population, equivalent to those found in advanced countries.

Speaking on the topic, “The Economic Survey 2016-17: How India Surprises,” at the Indian Institute of Managementahmedabad (IIM-A), he said, “From a demographic point of view, we have two Indias. We have an India that comprises of Tamil Nadu, Kerala, Karnataka, Andhra Pradesh and West Bengal, where populations have started becoming older and older, like some of the advanced countries. So we have the peninsular India, that resembles the advanced countries in terms of their age structure and then we have a young India; Bihar, Madhya Pradesh, Rajasthan, Odisha, which are much more young and dynamic.”

“So this is going to be huge challenge and an opportunity .... Soon there are going to be states in India that will start ageing and they will need people from other parts of India to look after their elderly. In a sense, we will need more migration in India, so that young demographic India with Bimaru states actually migrate more in order to look after the ageing population of some of the older, ageing states,” Subramanian added.

Referring to the Economic Survey 201617 presented recently in Parliament, he pointed out that an estimated 9 million migrant population travel between states for work. This was derived using data from Indian Railways for a period between 2011-16.

During his visit to his alma mater after 36 years, Subramanian also talked about rising disparity in India. According to him, in the last 15 years, poorer states in India have grown slower than the richer states. “So what it means is, the disparity within India is increasing and this is in sharp contrast to what is happening elsewhere in the world,” he said while drawing comparisons with countries like China where gap between rich and poor provinces is narrowing,” the CEA said.

“If Gujarat is growing faster than Odisha, people will come from Odisha to Gujarat. So you will see people from Orissa becoming richer because of partaking in what is happening in Gujarat. But, this is not happening enough in India and this is a deep puzzle...,” he added.

The CEA also talked about how India needed to quickly cash-in on its demographic dividend. “The other thing that we discovered is that, this window of opportunity that we call as demographic dividend is going to close very soon. We estimate that by 2020, we will reach the peak of demographic dividend and after that the growth of young people will start declining very rapidly and very soon.”

While taking questions from the audience Subramanian while taking about black money said that more “sticks and carrots” were required after demonetisation to “arrest” the flow of black money. He also said that despite government programmes like Jan Dhan, India was “far away” from achieving financial inclusion.

An estimated 9 million migrant population travel between states for work.