Data | With poor pension rates and high health costs, is India ready for the next demographic phase? Premium

By 2037, the share of Indians aged 25-64 is projected to peak and then start declining by 2052, while the share of the population aged more than 65 is expected to have risen

Old age pensions: An old beneficiary holding currency notes she received from her pension account.  India has one of the lowest share of the elderly receiving pension and the highest share of out-of-pocket expenditure on health | Photo Credit: PTI

In the next 80 years, India’s demographic structure is expected to change, with the share of the working population declining and the share of dependent residents increasing. By 2037, the share of Indians aged 25-64 is projected to peak and then start declining by 2052, while the share of the population aged more than 65 is expected to have risen. The shift will be first recorded in the southern States, with nearly 20% of the population in Tamil Nadu and Kerala crossing the age of 60 by 2036. India is not alone in this demographic shift. Most countries are either going through the change or are going to see such a change in the near future. However, India is among the nations with the lowest share of the elderly receiving pension and the highest share of out-of-pocket expenditure on health. This is a double whammy given the poor monetary support and sharp increases in health-related expenses post-retirement

Population share

The line graph depicts the % of the population in an age group over time in India. The share of the working age population will decrease, while the share of the older population is set to increase in India

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State-wise share

The graph depicts the % of the projected population in 2036 in the 15-59 age-group (vertical axis) and in the 60+ age group across States. In 2036, the southern States will have a relatively high share of senior citizens

 Dependency ratio

The scatter plot depicts the % of the dependent population (aged <15, >65) in 2022 and 2052 (projected) among select nations. The rise in the ageing population is not unique to India, with most economies facing a similar issue. In fact, for nations such as South Korea and Japan, the % share of the dependent population will be nearly 95% by 2052 

Pension versus health expenses

The scatter plot depicts the % of elderly people receiving old-age pension (vertical axis) and out-of-pocket (OOP) expenditure as a % of current health expenditure (horizontal axis) in select nations. India is among the countries with the lowest share of elderly people receiving pensions and the highest share of OOP expenditure in health

Source: Ourworldindata, UN, International Labour Organization