Bhubaneswar: Future seems very tense for Odisha! The outlook for the State in 2050 is not rosy, rather quite 'grayish'.
The demographic bombshell is Odisha will be among the top 10 states with most aging (65+ years) population in the country. And why this is a critical 'grey' news for Odisha is, the per capita income of the State is among the bottom -6 in the country. The ramifications of rising grey population on per capita income then would be disastrous.
As per an SBI research released recently, Odisha by 2050 will become the eighth State in the country to have an aging population far above the national average. The study authored by SBI Group Chief Economic Advisor Soumya Kanti Ghosh projected the population in the age-group of 65-years plus in Odisha at over 16.5 per cent of total population vis-a-vis 15.2 per cent nationally in the year 2050.
Though the 'grey' list in the country thirty years hence will be led by Andhra Pradesh and followed by other southern states, Maharashtra and West Bengal, Odisha joining the 'older' club will take a big toll on State's GDP and per capita income.
The reason is not far to seek. While Andhra Pradesh is ranked among the top-ten prosperous states in country (based on per capita income), Odisha figured among the bottom-six states in the country.
The low per capita income of Odisha reflects the poor productivity of its economy. And as per a recent World Bank report, economies with poor productivity are going to have a severe hit on their GDPs when the proportion of population in age-group of 65-years plus shows a rise.
Another nagging fact is the old-age dependency ratio for the State is high, Odisha has been slotted at 7th place nationally. Old age dependency ratio means number of elderly persons dependent per 100 persons in the working age - group.
Since the State has higher unemployment rate of 7.1 per cent in comparison to 6.1 per cent nationally, the steep spike in old-age dependency ratio in the State then will have a negative impact on the State's economic prosperity.
How this will pan out politically? As per World Bank report, an economy with a definite pension system for the aged will cut into the losses on the economy owing to the rising graying population. A pension plan will force the worker population to save, and rise in savings will increase the productivity of the economy - hence the GDP.
It is in this context, political observers view the announcement of an umbrella pension scheme by Modi Sarkar in the budget 2019-20 as a political master stroke, which gives BJP the early start in the vote race for the year 2024.
The Pradhan Mantri Shram-Yogi Maandhan Yojana (PMSYMY) is a mega pension scheme of the Modi government, which prescribes a definite pension amount for all whose income is below Rs 15,000 per month. The scheme covers both organised and unorganised sectors. With a minimum contribution of Rs 55-100/month, a beneficiary may draw an assured pension amount of Rs 3,000 after 60-years.