Economic Survey report hints at an increase in retirement age due to higher life expectancy

New Delhi: As stated in the Economic Survey, the rise in retirement age for most of the Indians is due to the increase in life expectancy. The survey says that during 2031-41, India’s population is expected to grow under 0.5 per cent as this is being directly affected by the decline in fertility rate and an increase in life expectancy.

Tabling the Economic Survey for 2018-19 in the Parliament on Thursday, Finance Minister Nirmala Sitharaman says, “Since an increase in the retirement age is perhaps inevitable, it may be worthwhile signalling this change well in advance – perhaps a decade before the anticipated shift – so that the workforce can be prepared for it.”

Further, it has also been stated by the survey that the increase in life expectancy will help in planning for pensions and other retirement provisions in advance. As life expectancy is expected to increase in both males and females of the nation, increasing the age of retirement too is likely to rise.

Notably, many other countries have started increasing the age of retirement of its employees due to ageing population and increasing pressure on pension funding.

The report also states that the population growth of India will continue to decline over the next two decades. The growth will be less than 1 per cent during 2021-31 and under 0.5 per cent during 2031-41.

The Economic Survey report says, “Such population growth rates would be close to the trend currently seen in countries such as Germany and France. In fact, with total fertility rates (TFR) projected to fall well below replacement level fertility by 2021, positive population growth in the next two decades will be due to population momentum and the continued rise in life expectancy.”

The total fertility rate of Indian women at present is 2.1 children per woman and it is below the replacement level fertility in 13 out of the 22 major states.

This is even worrying a matter that the TFR has reached as low as 1.6-1.7 in Delhi, West Bengal, Tamil Nadu, Andhra Pradesh, Telangana, Punjab and Himachal Pradesh etc states.

Also read: Bengal raises retirement age of college, university teachers to 65 years