India must act before having only one child, or none at all, becomes a cultural norm, warns Shamika Ravi, Member of the Economic Advisory Council to the Prime Minister. The country’s fertility rate has declined to 1.9, dipping below the replacement level of 2.1. This means Indian women are, on average, having fewer children than needed to maintain the current population size.
This trend, however, is not unique to India. The United Nations Population Fund’s recent State of World Population 2025 report points out that fertility rates are falling across the globe. Yet, the Indian case is exceptional. "The fertility decline in India is happening at a relatively lower per capita income level," says Ravi.
According to the National Family Health Survey (2019–20), 31 out of India’s 36 states and union territories had fertility rates below the replacement level. In response, Chief Ministers of Andhra Pradesh and Tamil Nadu have publicly urged citizens to have more children. However, observers believe such appeals are driven more by political anxieties tied to shrinking populations than by genuine demographic foresight.
"Even when politicians today say, 'Have more children,' it would not make a difference. Nobody will have more children just because politicians are asking. No way," says Ravi. In an exclusive interview with Outlook Business, Ravi discusses the depth of the crisis, its long-term consequences, and how governments must urgently recalibrate their approach. Edited Excerpts:
The general global pattern is that fertility rates decline after countries become affluent, as seen in South Korea and Japan. However, India is something of a partial exception to this trend. Why is that?
There are various aspects to declining fertility. I think it is important to understand that there are different driving forces, which is why income, when you look at it by itself, or affluence, or wealth, GDP per capita, that is just one overriding metric. So one factor is income levels because the need to have more children goes down.
But even with rising income, the rapid decline we have seen in South Korea and Japan is unparalleled, when compared to other fast-growing and today rich economies. What has happened in Asia, and Eastern Asia in particular, and that is the broader context in which we must understand India’s change, is the role of women in the household. How gender-equal is it when it comes to working or going out to participate in the labour market? That is a cultural issue.
The comparison with Korea and Japan helps us understand how fast improvement in income, without a commensurate change in the role of women in the household, leads to a rapid decline in fertility. With rising female labour force participation, if the gender roles at home do not shift, you are going to see a very sharp drop in fertility rates. That is the crisis we are seeing in South Korea and Japan.
What are the implications for China’s economy as it tries to surpass the United States to become the largest economy?
China is similar in that it is also a culturally traditional society, but they had a coercive state policy, limiting families to one child. That policy has more than backfired. They are not a rich economy yet. Yes, they have grown remarkably over the last 40 years, but they have not become rich.
They are at a higher middle-income level now, and we do not have full clarity on internal distribution, like rural-urban divides. But even from a macro perspective, their income is not high enough to support a very large elderly population with a relatively small working population. So they have ended up ageing faster than they have become rich.
Now, their growth is becoming expensive from a labour perspective. That is one of the big reasons companies are moving away. They were looking for labour arbitrage, cheaper labour, and that is no longer the case. China’s manufacturing story today is not about cheap labour anymore, but about scale, huge scale. And then you add to that the trade war, Trump, and everything else going on geopolitically.
So the same fear of becoming old before rich applies to India as well?
Right now, the Indian case is interesting because we are facing many of these challenges simultaneously. It is exceptional; we are not like an average Asian country. The fertility decline in India is happening at a relatively lower per capita income level. Even in terms of PPP, $11,000 per capita is not enough.
This means we need several decades of sustained growth ahead. We already have around 150 million people above the age of 60. That is the broader macro factor. It tells us that sustaining a large dependent population, while the working-age population starts to decline, because we are having fewer children now, will be very difficult.
In about 20 years, the working-age population will be much smaller than it is today. But our elderly population will keep increasing, because we are living longer. So the big question is who is going to pay? Who is going to drive growth if the working-age population starts shrinking relative to the elderly too quickly? That is the real fear, especially at this level of income.
Where does the problem lie for India?
The beauty of the Indian situation is that what is true at the all-India level has many different facets. The fertility crisis we are seeing is fundamentally an urban problem. Urban India has had below-replacement fertility rates for the last 25 years.
Red flags have been raised, and we, economists and others tracking the data, have been talking about it. There have been a series of reports. What we are seeing in urban India is that women are either not having children or having remarkably fewer children, and this shift has happened very quickly. That is a phenomenon we must acknowledge.
Does it mean that in the future, we should see greater divergence between the fertility rates of poor states in the North and affluent states in the South?
We often default to viewing this issue through a North-South lens, but that is not the right approach to look at it. It is more useful to look at how urbanised and developed a region is. Yes, UP (Uttar Pradesh) and Bihar are often clubbed together as major contributors to high fertility, but the difference between the two is significant.
Bihar is still at an excess of 3, while UP is much lower. So we need to start de-hyphenating the two. These states are on very different trajectories now. Similarly, look at states like Meghalaya. It has very high fertility too. So it is not just about North versus South.
Typically, underdevelopment is linked with higher fertility because fewer babies survive, so people tend to have more children. But we are well past that stage. Our child mortality rates have come down; children are surviving. So now we have to ask what is impacting the cultural factors that lead to more children. That includes openness to family planning, decision makers within the household, women’s role, access to contraceptives, et cetera. There are many layers to it.
If the decline in fertility is primarily an urban phenomenon, why are less urbanised states also seeing a drop?
The crux of the matter is joint families. Childbearing and child-rearing are clearly labour-intensive, and the burden falls almost entirely on young women, who today are getting more education and training. How are they supposed to manage without family support? It is in joint families where mothers actually thrive. In rural areas, because families often include multiple generations, there is someone to take care of the baby. Women can work. In fact, in rural India, female labour force participation has risen by 69% over the last 10 years.
In contrast, in urban areas, women’s labour force participation is nearly half of what it is in rural areas, and fertility is also much lower. A simple mind would say women in cities are neither working nor having children. But that is a lazy way to look at it.
We need to act before it becomes a cultural norm to have only one child, or none at all. We have seen this happen elsewhere in the world. The main issue now is that we must build care infrastructure. We have to provide as much support as possible, from the government, but also from society, for women.
How do we do that? First, we need institutions for care. Right now, that entire burden falls on women. We must create care infrastructure and provide financial instruments support, like tax breaks, to give women a real choice about working. We need to reduce the cost of going out to work. Female labour force participation is deeply linked to this entire care economy. I have estimated the value of that care. It is 17% of GDP.
The issue is who will substitute for the women when she goes out to work? Are the men doing it? At the same time, we are nuclearising very fast. We are urbanising very fast. Both of these shifts are happening rapidly, much faster than projected. This transition is happening through free will. But that free will is not truly free because the expectations are the same like they were 50 years ago.
But will investments in care economy alone be sufficient to address this? Because like you said, the issue is cultural.
What I am trying to say is that our policies must become family-friendly. Right now, we treat every individual in isolation, ignoring the benefits of a family. When I say reduce the cost on a woman, I mean she is more educated today than ever before. Today, more women than men are enrolled in higher education in India. Forty-five percent of STEM graduates are women. So women are getting more education than ever in our history, but your fertility is declining because you are not supporting them.
Think about how much talent and productivity is trapped inside households. We are not able to extract value from it. And when I say women-friendly, I really mean family-friendly. If we want women to have children, we have to support them.
Then there is the issue of perception. If a woman chooses to stay at home and take care of her family, she is called a housewife, and even that I am told is seen as a derogatory term now. So we are trying to come up with new terms like “homemaker.” But why should we be ashamed of this role? A woman who spends her time and energy raising a healthy family and maintaining a stable home with sound finances is making a valuable contribution. That should not be discounted in any economy.
So, we need to talk about both sides. We must become family-friendly as a society. It should be completely valid for a woman to stay at home, if that is what she wants. But if she wants to go out and work, we cannot tell her to also have more children without providing daycare or elderly care. That is why your mental health issues today are largely among women.
How do we shift the population conversation toward the issue of declining fertility? Most state leaders remain silent, even in regions where fertility rates are falling.
Part of the issue is also how we have thought about population in policy terms. In India, there is still a mindset that population is a problem. That thinking has to change completely. It needs a 180-degree shift. Population is our biggest strength, and I do not mean that rhetorically. At the end of the day, our economic growth is driven by labour. The challenge now is to make that labour force more productive, and that is where skilling and education comes in.
You mean like how China converted its large population into its greatest asset to become the second-largest economy…
It is. But remember, China also treated its population as a liability. That is why they enforced a policy telling people not to have more children. And now, it is a lesson for India. We had the hum do hamare do for some time. That still shapes our policy thinking. It remains part of our institutional memory. And now, there is an effort to course-correct it within hospitals and communities.
Even when politicians today say, “Have more children,” it would not make a difference. Nobody will have more children just because politicians are asking. No way.
In that case, what should be the policy direction for economic growth?
To reverse the fertility decline, or even respond to it properly, the first step is to acknowledge that past trends and projections have been overtaken by reality. The changes are happening much faster than expected. This calls for a reality check. We need real-time data at more localised levels to understand what is happening with fertility, demography, and the ratio between working and dependent populations. This we need at the state level, not just at the national level. Talking about India as a whole is like talking about a continent.
That is why broad policy prescriptions like “having more children” do not make sense for a state like Bihar. On the other hand, telling people to have fewer children is not logical for places where fertility has been below replacement for 25 years. Both approaches are outdated. This debate needs to be anchored at the state level, with tailored strategies based on regional realities.
When I say the beauty of India, I mean that a lot of internal migration happens. And that is what will sustain economic growth in regions experiencing rapid development and industrialisation.
People move out from relatively more agricultural and rural areas to the western parts of the country, for example. We saw this clearly during COVID. Reverse migration was almost entirely in one direction. Just like Europe opened it borders to bring in young workers from outside, we will rely on internal migration. It will happen, and it must be encouraged.
Ultimately, if we want to sustain this pace of development growth, especially with our 2047 goals in mind, then we have to continue growing for another two and a half to three decades, at the current rate or even higher, if we can.
As fertility rates fall, how should states factor in internal migration patterns when planning for their demographic future?
Several scholars have studied migration within India, and one of the key observations is that the largest share of migration happens within districts, followed by within the state, then interstate, and finally international. These are empirically documented and vary from state to state, so the analysis must be disaggregated accordingly.
Historically, there have been well-established migration networks, like Gujarati entrepreneurs who migrated to countries like Nigeria, Ghana, and Uganda decades ago. Similarly, within India, new migration routes have been emerging rapidly. For example, the movement of Bengali Muslim men from West Bengal to Kerala is a relatively recent phenomenon, but it is growing quickly. There are several case studies on this group.
Despite linguistic and cultural differences, assimilation does occur over time. As with most migration, there are clear push and pull factors at play. But to understand these patterns, you need to assess each state individually, even though the overall analytical framework remains the same.
Take Bihar and eastern UP, for example. These regions traditionally sent agrarian workers to Punjab and Haryana, especially during peak agricultural seasons. That is changed now. With the rise of industry, many are heading instead to Maharashtra, Tamil Nadu, and Gujarat, toward factory jobs in industrial belts.
India’s growth trajectory, whether agriculture- or industry-led, determines the flow of migration. As we mechanise and industrialise, labour patterns shift accordingly. Construction work, for instance, has become a pan-India employment sector. You will find Assamese, Bengali, and Bihari workers engaged in construction across the country.
What we really need now is comprehensive data. Earlier, we relied on Census data to track internal migration. But it is time we had a dedicated national survey focused on migration. Ideally, every decade should include one major, detailed study of internal migration trends to inform policy and planning.
Heads of Andhra Pradesh and Tamil Nadu have publicly expressed concern over declining fertility. But history shows that no government has successfully reversed a falling fertility trend once it sets in. Could that be why others are choosing to stay silent?
In the South, it is not so much coming from an economic perspective. These concerns are rooted in political insecurities, especially around delimitation, representation in Parliament, and fiscal devolution. That is what driving a lot of the rhetoric.
There is also an assumption that workers from the North will continue migrating south, and that this labour oversupply will persist. But we are saying that give it another 25 years. There will be very few states with surplus labour. Also, Andhra, since you mentioned, has the lowest female labour force participation in urban areas. It should worry about those things.
Given that India has long been exporter of STEM talent to other parts of the world, and with many ageing economies now actively seeking skilled workers from abroad, do you not think that this emerging global demand will add a new layer of urgency to states with falling fertility rates?
You are right. But one empirical question is whether urban students are more likely to pursue STEM education than rural students. I do not think so. Many of our top institutions like the IITs, IIMs, and central universities have long had reservation and quota policies. These have helped attract significant talent from rural India and disadvantaged sections of society.
Secondly, will the ageing Western world continue to look toward India for STEM graduates? Yes, that is exactly what they have been doing for the past 35-40 years. You should wonder when Canada decided to open new High Commissions, which two places did they target first? Bengaluru and Tel Aviv.? What do they have in common? Young engineers. Engineers who will go to Canada and contribute to paying for their ageing population’s pensions. These are economic flows.
As ageing economies around the world ramp up investment in healthcare, should we now do the same because as per reports, even our young workforce is not fit enough?
That is, regardless of fertility and everything else, yes, healthcare investments must increase, and I am glad you are saying investments. When we think of investments in healthcare, we often confuse it with just spending. But it is about making people physically and mentally able. Simply put, if you do not fall sick as often, you are more productive than someone who is frequently unwell.
Also, the nature of illnesses is changing. As we urbanise, lifestyles are becoming more sedentary, leading to a rise in what we call “lifestyle diseases.” It is a strange term, but the point is clear. Our average district hospital cannot just focus on communicable diseases like diarrhoea or malaria anymore.
The healthcare infrastructure has to evolve. With more elderly people, we need elder care. We have been working on this, but we need to do much more, especially in strengthening primary care. If you just have a fever, there is no reason to rush to a super-speciality hospital. A well-trained nurse or a general practitioner should be able to take care of it. That means we have to rethink how we staff facilities and where we allocate our spending.
Ayushman Bharat is already a step in the right direction. But we need to keep improving our Wellness Centers. This is regardless of any demographic trend. The productivity of India’s workforce has not risen significantly in recent years. If we want labour productivity to improve, we must invest in healthcare and education.
