A Costly Policy Error by China Should Be a Cautionary Tale for India

India's demographic landscape has changed significantly over the past several decades. Fertility has declined sharply, population growth has slowed and several states are already experiencing fertility rates well below the replacement level.

Against this backdrop, a new working paper from the Economic Advisory Council to the Prime Minister (EAC-PM) has highlighted China's experience as an important reference point for India's future population policy.

The paper, titled "The Ghost of Population Past: How Population Control Persists in India", has been authored by Sanjeev Sanyal, Aakanksha Arora and Virat Singh. It argues that India's earlier population-control framework was designed for a demographic reality that no longer exists.

The central concern is that policies intended to reduce fertility can become difficult to reverse once low fertility becomes embedded in social behaviour and expectations.

India Has Moved Beyond Its Earlier Population Problem

For decades, India's population policy was shaped by concerns about rapid population growth.

Family-planning programmes focused heavily on reducing fertility, promoting contraception and encouraging smaller families.

However, India's fertility rate has now fallen considerably.

According to the EAC-PM working paper, India's national total fertility rate (TFR) is 1.9, below the replacement level generally associated with a stable population over the long term. Without Bihar and Uttar Pradesh, the paper puts the TFR at 1.6.

The report therefore argues that continuing to treat population reduction as a central policy objective risks overlooking India's emerging demographic challenges.

What Is Replacement-Level Fertility?

Replacement-level fertility refers broadly to the average number of children women need to have for a population to replace itself from one generation to the next, assuming mortality and other demographic factors remain relatively stable.

For many countries, replacement fertility is around 2.1 children per woman, although the exact level can vary.

When fertility remains below replacement level for an extended period, populations can eventually begin to shrink once the effects of demographic momentum wear off.

This can lead to:

• A growing elderly population

• A smaller working-age population

• Higher dependency ratios

• Greater pressure on pension systems

• Increased demand for healthcare and elder care

• Potential labour shortages

The EAC-PM paper argues that India needs to consider these longer-term consequences as fertility continues to decline.

China's Population Policy Offers a Key Lesson

China provides one of the most prominent examples of the difficulty of reversing a sustained decline in fertility.

For decades, China implemented strict population-control measures, most notably the one-child policy.

The policy helped reduce population growth, but the country's demographic structure subsequently changed significantly.

China now faces challenges associated with:

• Low fertility

• Population ageing

• A shrinking working-age population

• Rising dependency pressures

• Difficulty encouraging families to have more children

The EAC-PM paper uses this experience to illustrate why demographic policies may need to change before low fertility becomes deeply entrenched.

China's Challenge Is Not Simply the One-Child Policy

The lesson from China is more complicated than simply saying that the one-child policy caused today's demographic challenges.

The broader issue is that fertility behaviour can change permanently when social norms, economic incentives and family structures evolve over several decades.

Once smaller families become normal, governments may find it difficult to persuade households to have more children even after restrictive policies are removed.

This is because fertility decisions are influenced by factors beyond government rules, including:

• Housing costs

• Education expenses

• Employment conditions

• Marriage patterns

• Urbanisation

• Women's employment

• Childcare availability

• Family preferences

• Expectations about living standards

Consequently, reversing a low-fertility trend can be considerably harder than reducing fertility in the first place.

India's Fertility Decline Is Not Uniform

India's demographic transition is not happening at the same speed everywhere.

The EAC-PM paper points out substantial differences between states.

Several southern and more economically developed states have recorded fertility rates significantly below the national average.

The paper cites TFR levels of:

State/RegionTFRAndhra Pradesh1.4Telangana1.5Karnataka1.5Kerala1.3Tamil Nadu1.3West Bengal1.3Punjab1.4Goa1.6Maharashtra1.4Delhi1.2Sikkim1.0

These figures demonstrate why a single nationwide population policy may not reflect the demographic circumstances of every state.

Southern States Are Already Ageing Faster

Several southern states have been below replacement fertility for more than two decades, according to the EAC-PM paper.

The paper says the demographically mature southern states — including Andhra Pradesh, Telangana, Karnataka, Kerala and Tamil Nadu — have fertility levels well below replacement.

Along with states such as West Bengal, Punjab and Maharashtra, these regions have demographic profiles increasingly associated with ageing populations.

The paper places their median age at around 35 years, compared with approximately 30 years for India as a whole.

This creates an important policy distinction: some parts of India continue to have relatively young populations, while others are already moving towards older demographic structures.

India's Population Is Still Growing Despite Falling Fertility

A falling fertility rate does not immediately cause the total population to decline.

India continues to experience population growth partly because of demographic momentum.

A relatively young population means that a large number of people are entering or remaining within childbearing ages even as the average number of children per woman declines.

Longer life expectancy and improvements in healthcare also contribute to population growth.

The EAC-PM paper notes that India's live births peaked at around 29 million in 2001 and have since fallen to below 23 million.

This means India's demographic transition is already visible even though the country's total population remains large.

Why Policy Timing Matters

One of the central arguments of the EAC-PM paper is that policy should respond to demographic changes in a timely manner.

If fertility is already below replacement level, continuing policies designed primarily to suppress fertility may no longer serve the same purpose.

The concern is not that India should encourage population growth indiscriminately.

Instead, the argument is that population policy should reflect the demographic conditions of different parts of the country.

This could mean moving away from a one-directional focus on reducing fertility and towards broader issues such as reproductive choice, healthcare, childcare and demographic resilience.

EAC-PM Calls for Changes to Population-Control Policies

The working paper makes several recommendations concerning India's existing population-control framework.

It calls for ending sterilisation-linked incentive payments, including certain direct benefit transfers associated with sterilisation.

It also recommends removing incentives and programmes that explicitly encourage couples to limit family size to two children.

The paper further calls for reviewing or repealing two-child norm-related disqualifications in states and removing population-control language from policy frameworks.

These recommendations represent a shift in emphasis from controlling population growth to responding to India's changing demographic conditions.

Family Planning Would Still Remain Important

The EAC-PM paper makes an important distinction between population control and family planning.

The authors do not argue against access to contraception or reproductive healthcare.

Family planning can remain important for:

• Birth spacing

• Maternal health

• Child health

• Reproductive choice

• Preventing unintended pregnancies

• Supporting household preferences

The argument is instead that family-planning services should serve individual and family needs rather than being primarily designed to reduce the country's overall population.

This distinction is important because reproductive healthcare and population-control policy are not necessarily the same thing.

The Risk of a Low-Fertility Trap

A major concern raised by the paper is the possibility of a low-fertility trap.

Once fertility falls below a certain level, social expectations can reinforce the trend.

If families increasingly expect to have one or two children, smaller family sizes can become socially normal.

Children may also face higher educational and housing expectations, increasing the perceived cost of raising a family.

Over time, these factors can make fertility recovery difficult even if governments later introduce incentives encouraging larger families.

China's experience illustrates the difficulty of reversing a demographic trend after it becomes deeply established.

Economic Consequences of Population Ageing

Demographic change has significant economic implications.

A growing elderly population can increase demand for healthcare, pensions and social support.

At the same time, a smaller working-age population can create pressure on labour markets.

Businesses may face difficulty finding workers in certain industries, while governments may need to increase spending on elder care and social security.

For India, the demographic transition is particularly important because the country has long benefited from a relatively large working-age population.

Maintaining productivity and employment will therefore become increasingly important as the age structure changes.

India's Demographic Dividend Has a Time Dimension

India has often been described as benefiting from a demographic dividend because of its large working-age population.

However, a demographic dividend is not permanent.

As populations age, the proportion of elderly people increases and the relative share of working-age people can eventually decline.

This means India needs to use its current demographic structure effectively through:

• Employment creation

• Skills development

• Higher productivity

• Better healthcare

• Greater female workforce participation

• Investment in education

• Retirement and pension planning

The demographic transition therefore has implications far beyond population statistics.

Regional Differences Require Different Policy Approaches

India's demographic diversity makes policy design particularly complex.

Some states continue to have relatively higher fertility, while others have already moved deeply into low-fertility and ageing conditions.

A uniform policy could therefore produce different effects in different regions.

The EAC-PM paper's state-level comparisons highlight the importance of recognising these differences when designing future family-planning and demographic policies.

Population Policy and Economic Development

Fertility decline is often associated with economic and social development.

Urbanisation, increased education, rising incomes, delayed marriage and greater participation of women in education and employment can all influence fertility decisions.

At the same time, the cost of raising children can rise as families seek better education, housing and healthcare.

This means demographic policy cannot be separated entirely from economic policy.

Measures affecting childcare, housing, employment and women's workforce participation can influence how households make decisions about family size.

What India Can Learn From China's Experience

The China comparison provides several broad policy lessons.

Policies Must Adapt to Changing Demographics

A policy designed for rapid population growth may become unsuitable once fertility falls substantially.

Demographic Changes Are Difficult to Reverse

Once low fertility becomes embedded in social behaviour, financial incentives alone may not immediately reverse it.

Regional Differences Matter

India's states are at different stages of demographic transition and may require different policy priorities.

Family Planning and Population Control Are Different

Access to reproductive healthcare can remain important even when reducing population size is no longer a policy objective.

Ageing Needs Long-Term Planning

Governments need to prepare for changes in healthcare, pensions, labour markets and social infrastructure.

Population Control Policies Still Exist in Some States

The EAC-PM paper notes that population-control measures remain embedded in parts of India's policy framework.

These include certain two-child norms and incentives or disincentives associated with family size.

The paper argues that such measures should be reconsidered in light of the country's current fertility levels.

This is particularly relevant in states that are already experiencing below-replacement fertility and increasing ageing pressures.

A Shift From Population Control to Demographic Management

The emerging debate does not necessarily mean that India needs a new policy aimed at increasing births nationwide.

Rather, it points towards a broader concept of demographic management.

Such an approach could consider:

• Fertility trends

• Ageing

• Migration

• Labour supply

• Healthcare

• Childcare

• Women's employment

• Regional demographic differences

• Social security

This would represent a broader policy framework than simply targeting the number of births.

China's Experience and India's Future

China's demographic experience demonstrates that population policies can have consequences lasting well beyond the period in which they were introduced.

India's circumstances are different from China's, including differences in political institutions, economic structure, regional diversity and the timing of fertility decline.

Nevertheless, the comparison provides a useful policy question: when demographic conditions change, how quickly should government policy change with them?

The EAC-PM paper argues that India has reached a point where older population-control objectives need to be reassessed.

Key Demographic Indicators

IndicatorFindingIndia's national TFR1.9TFR excluding Bihar and Uttar Pradesh1.6Approximate replacement levelAround 2.1India's median ageAbout 30 yearsMedian age in several demographically mature statesAbout 35 yearsIndia's live births in 2001About 29 millionRecent live birthsBelow 23 millionKey EAC-PM paper"The Ghost of Population Past"

The figures are drawn from the EAC-PM working paper and related reporting.

What Could Change in India's Family-Planning Framework?

If the recommendations are adopted, India's policy framework could increasingly focus on reproductive health and individual choice rather than population reduction.

Possible changes discussed in the EAC-PM paper include:

• Ending sterilisation-linked incentives

• Reviewing two-child norms

• Removing population-control language

• Maintaining contraception access

• Supporting reproductive healthcare

• Recognising regional fertility differences

• Preparing for population ageing

Such changes would represent a significant evolution in the way India's demographic policy is framed.

The Broader Economic Challenge

India's demographic transition creates both opportunities and challenges.

A declining fertility rate can eventually reduce the number of dependants per working-age person in some stages of development.

But later, ageing can increase the dependency burden again.

The policy challenge is therefore to use the current working-age population effectively while preparing institutions for a future in which the elderly represent a larger share of society.

This requires long-term planning rather than focusing exclusively on current population numbers.

Bottom Line

India's fertility rate has fallen to 1.9 nationally, below replacement level, according to the Economic Advisory Council to the Prime Minister's working paper "The Ghost of Population Past." Several states have much lower fertility rates, with parts of southern India already experiencing demographic conditions associated with ageing economies.

The EAC-PM paper uses China's experience with decades of population-control policies to highlight the difficulty of reversing fertility declines once they become deeply embedded in social and economic behaviour. It recommends that India reconsider policies such as sterilisation-linked incentives and two-child norms while continuing to provide family-planning services for health, birth spacing and individual choice.

The broader policy issue is therefore not simply whether India should have more or fewer people. It is how government policy should adapt to a country moving from concerns about population growth towards challenges involving low fertility, ageing, labour supply and regional demographic differences.

Disclaimer: This article is for informational purposes and is based on the EAC-PM working paper and current news reports. Recommendations discussed in the working paper represent the authors' analysis and do not by themselves constitute a change in government policy. Demographic trends and policy responses can evolve over time.