‘India needs to grow before she gets old’

Tribune News Service 

Chandigarh, February 7 

India needs to grow faster before she grows old. This was stated by Andreas Bauer, IMF Senior Resident Representative for India, Nepal and Bhutan. 

Bauer was at Panjab University (PU) on Thursday for the 52nd colloquium on ‘Growing old before becoming rich? Macroeconomic implications of ageing in Asia’. 

He said Asia was growing older at a rate much faster than the US and Europe in the past. 

“Several Asian countries would grow old before becoming rich. The demographic window is not eternal. India also needs to grow fast.” 

He said India’s working age population share will reach its peak in 2040. “The structural reforms will be the key for ensuring the high total factor productivity (TFP) growth and convergence while the demographic dividend lasts.” 

He said the country would need to prepare for growing old and has to strengthen safety nets such as broadening pension coverage and maintaining a sound fiscal position. 

Policy responses

He said India could reap a demographic dividend over the next 25 years if it manages the opportunity well. 

He said India should ensure labour market flexibility and invest in labour productivity and employability-health, education and skill. He also advised removing impediments to savings and investment and ensuring macro stability. 

He called for participation of women in the labour force and taking advantage of opportunities in ‘aging’ countries as there was demand for migration. 

Earlier, Prof Upinder Sawhney, Chairperson, Department of Economics, introduced the speaker by informing that he held senior positions in the Ministry of Finance of Chile, including the Chief of the staff to the Minister. During his more than 15 years of career at the IMF, he has also worked as a Mission Chief and Senior Economist in several countries, mainly in Latin America and the Middle East.