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Demographic Dividend and unemployment problems in India, China

GS Paper 1

 Syllabus: Population and Associated Issues


Source: IE

 Context: The current median Indian age of 28, as compared to China’s 39, suggests that India will continue to enjoy its demographic advantage up to the end of this century.


Case of China:

  • China’s youth population was declining and the ageing population was rising.
  • In 2023, ~12 million students in China are expected to graduate.


Challenges faced by China:

  • China is facing a new kind of epidemic: joblessness.
  • The job market was hit hard by the Covid-19 lockdowns and massive layoffs in key sectors such as real estate, tech, and education.
  • Growing demand for job security and lack of employment opportunities.


What went wrong with China’s job market? The country’s growth was hit hard during the Zero-Covid three years.

Scenario in India: Poor education, joblessness and a shortage of skilled personnel.



  • Undocumented migration.
  • The increasing rate of crimes: India has become a hub for internet-based scams.


What went wrong in India?

  • 2,500+ Industrial Training Institutes: Established in the 1960s and run by state governments, have failed to update their skilling courses.
  • The National Skill Development Corporation (NSDC): Created in 2003, NSDC’s short-duration courses (<1 year) are insufficient for real skill acquisition.
  • Sub-standard engineering colleges: Mostly function as money-making enterprises, giving inadequate training.


The National Education Policy (NEP) 2020 and jobs:

  • The NEP 2020 introduced vocational training for 6th, 7th and 8th-grade students to improve their skills in a particular field.
  • This has to continue at the secondary level, with vocation-focused schools.


What are the solutions?

  • Job creation is the topmost priority.
  • Skilling, to effective outcome levels, should be the constant goal.
  • The NEP vision should lead to a different kind of high school that continue with skilling training.
  • MSMEs should be further incentivised as the major employment creators.
  • India must add to its inherent IT capabilities without neglecting the manufacturing sector.


Best practice – The German model of skill development: It comprised two strictly separate sectors: the higher education system and the system of dual (at the company level and classes at a vocational school) vocational education and training.


Conclusion: Currently, India is taking minimal benefits of demographic dividends. In order to take full benefits of demographic dividends, high-quality jobs need to be created and highly skilled youths need to fill these jobs.


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