- Date : 26/04/2022
- Read: 4 mins
The term longevity meaning those people who have lived very long. Although living a healthy and long life is better, the economic impact of an ageing population has been observed in various countries. As a growing economy, India needs to be prepared to face the economic impact in the future when longevity is an issue.
India, which ranks as the second-most populous country, has plenty to offer. However, the growing economic concerns are far from over. In this article, we look into India's future with its increasing population and the need for a long-term plan.
The term "longevity" denotes those people who have lived long, while life expectancy is usually defined statistically as the number of years that remain at a certain age. The world has been ageing for a long time, yet policy building has not yet taken the necessary steps to deal with the possible problems this population could create for the world.
An ageing population will affect the future as it never has at any time in the history of mankind. It will affect everything from transportation, cities, consumption, and the relations between nations. For it to be positive, rapid policy change is required.
Is the world getting older?
The world is getting older. However, this will result in profound economic and social consequences significantly more than in the past. By 2030, one in six persons in the world will be aged 60 or more. By 2050, more than 80% of the population will be in low-income or middle-income countries.
The combination of global conflicts, climate change, and the potential for opportunities and fears around ageing & technology would make the world terrifying for many. The effects of climate change and ageing are long-term problems with no short-term gain. Technology advances rapidly, but policy and societal adjustments don't happen that swiftly.
The main factor is that technology is evolving faster and faster, but we're not as fast in adapting to ageing. Since cities are a global problem and are tied to climate change and technological innovation, we'll witness a significant increase in economic problems during the next 10 years due to ageing.
Longevity in India
In India, it is interesting to observe the huge rise in the population of people older than 80, and in China, the same problem is being observed. The reason for a distinction across the globe is in countries such as Europe or the United Kingdom, and welfare systems were established when those regions had young populations and, in contrast, China and India must develop welfare systems even though their populations are already beginning to get older. In terms of economics, this isn't easy to achieve.
In the next 40-50 years, we'll witness populations begin to decrease. Research done by The Lancet suggests that populations will begin to decline across large parts of the globe by 2050; however, we're living longer. The future will see countries will have smaller populations; however, they'll have older people. The issue for governments is to manage such situations both economically and socially.
At 69.4 years in India, the average life expectancy has seen a nearly 20-year leap over 49.7 in 1970. While this isn't an easy accomplishment, the sad fact is that Japan was present in 1960 and China in the year 1990. The connection between life expectancy and poverty is pretty apparent when looking at the Indian tale.
Concerns that India's current economic challenges have slowed the pace of fighting poverty make life expectancy an important indicator to monitor. Countries such as Nepal and Bangladesh were less likely to live longer than India at the time of the eighties; however, they are now ahead. In addition, the prevalence of poverty and access to health services may be the primary factor that separates the Indian population. This is evident from the infant mortality and the maternal mortality rates that correlate with life duration.
Apart from the problems faced by the government, individuals need to align their portfolios to prepare for the longer retirement due to longevity. First of all, you need to factor in the increased life expectancy, to figure out your retirement corpus. Also, you should not take the average life expectancy, but factor in the life expectancy of the top 10% of people in your demographic. This will ensure that you do not face hardships in old age. Also, when you are preparing for retirement, being conservative is the key to success, and you should ask your financial advisor to factor in the higher lifespan you expect.
Conclusion
The government should prepare for the upcoming issue of longevity. In a country like India, the economic impact can be substantial. If we start preparing for the ageing population, it will help our country face the economic impact. The global impact of an ageing population has been seen in many countries, and usually, poverty increases. India already has the data points of various countries to consider, and if we can prepare in advance, the issue of longevity might not affect India much. For individuals, if you factor in the increase in lifespan in your retirement corpus, you can expect to live a fruitful and enjoyable old age.
