How the Demographics of China and India are Diverging

Within popular discourse, especially in the West, the profiles of China and India have become inextricably linked.

Aside from their massive populations and geographical proximity in Asia, the two nations also have deep cultural histories and traditions, growing amounts of influence on the world stage, and burgeoning middle classes.

China and India combine to be home to one-third of the world’s megacities, and they even had identical real GDP growth rates of 6.1% in 2019, based on early estimates by the IMF.

Diverging Demographics

But aside from the obvious differences in their political regimes, the two populous nations have also diverged in another way: demographics.

As seen in today’s animation, which comes from AnimateData and leverages data from the United Nations, the two countries are expected to have very different demographic compositions over time as their populations age.

The easiest way to see this is through a macro lens:

Populations of China and India (1950-2100)

Although the countries have roughly the same populations today — by 2050, India will add roughly 270 million more citizens, and China’s total will actually decrease by 30 million people.

Let’s look at the demographic profiles of these countries to break things down further. We’ll do this by charting populations of age groups (0-14 years, 15-24 years, 25-64 years, and 65+ years).

China: Aftermath of the One-Child Policy

China’s one-child policy was implemented in 1979 — and although it became no longer effective starting in 2016, there’s no doubt that the long-term demographic impacts of this drastic measure will be felt for generations:

The first thing you’ll notice in the above chart is that China’s main working age population cohort (25-64 years) has essentially already peaked in size.

Further, you’ll notice that the populations of children (0-14 years) and young adults (15-24 years) have both been on the decline for decades.

A reduction in births is something that happens naturally in a demographic transition. As an economy becomes more developed, it’s common for fertility rates to decrease — but in China’s case, it has happened prematurely through policy. As a result, the country’s age distribution doesn’t really fit a typical profile.

India: A Workforce Peaking in 2050

Meanwhile, projections have India reaching a peak workforce age population near the year 2050:

By the year 2050, it’s estimated that India’s workforce age population will be comparable in size to that of China’s today — over 800 million people strong.

However, given that this is at least 30 years in the future, it raises all kinds of questions around the economic relevance of a “working age” population in a landscape potentially dominated by technologies such as artificial intelligence and automation.

Different Paths

While it’s clear that the world’s two most populous countries have some key similarities, they are both on very different demographic paths at the moment.

China’s population has plateaued, and will eventually decline over the remainder of the 21st century. There is plenty of room to grow economically, but the weight of an aging population will create additional social and economic pressures. By 2050, it’s estimated that over one-third of the country will be 60 years or older.

On the other hand, India is following a more traditional demographic path, as long as it is uninterrupted by drastic policy decisions. The country will likely top out at 1.6-1.7 billion people, before it begins to experience the typical demographic transition already experienced by more developed economies in North America, Europe, and Japan.

And by the time the Indian workforce age group hits 800+ million people, it will be interesting to see how things interplay with the world’s inevitable technological shift to automation and a changing role for labor.

How Chinese Financing is Fueling the World’s Megaprojects

On a mountaintop a few miles north of the bustling streets of Harare, Zimbabwe, a curving, modern complex is beginning to take shape. This building, once completed, will be the home of the African country’s parliament, and the centerpiece of a new section of the capital city.

Aside from the striking design, there’s another unique twist to this development — the entire $140 million project is a gift from Beijing. At first glance, gifting a country a new parliament building may seem extravagant, but the project is a tiny portion of China’s $270 billion in “diplomacy spending” since 2000.

AidData, a research lab at the W&M Global Research Institute, has compiled a massive database of Chinese-backed projects spanning from 2000–2017. In aggregate, it creates a comprehensive look at China’s efforts to grow its influence in countries around the world, particularly in Africa and South Asia.

Beijing has ramped up the volume and sophistication of its public diplomacy overtures, […] but infrastructure as a part of its financial diplomacy dwarfs Beijing’s other public diplomacy tools.

– Samantha Custer, Director of Policy Analysis, AidData

Below, we’ll look at three diplomacy spending hotspots around the world, and learn about key Chinese-funded megaprojects, from power plants to railway systems.

1. Pakistan

In 2015, Chinese President Xi Jingping visited Islamabad to inaugurate the China-Pakistan Economic Corridor (CPEC), kicking off a $46 billion investment that has transformed Pakistan’s transportation system and power grid. CPEC is designed to cement the strategic relationship between the two countries, and is a portion of China’s massive One Belt, One Road (OBOR) initiative.

One of the largest projects financed by China was the Karachi Nuclear Power K2/K3 project. This massive power generation project is primarily bankrolled by China’s state-owned Exim Bank which has kicked in over $6.6 billion over three phases of payments.

Billions of dollars in Chinese capital has also funded everything from highway construction to renewable energy projects across Pakistan. Pakistan’s youth unemployment rate sits as high as 40%, so jobs created by new infrastructure investments are a welcome prospect. In 2014, Pakistan had the highest public approval rating of China in the world, with nearly 80% respondents holding a favorable view of China.

2. Ethiopia

Ethiopia has seen a number of changes within its borders thanks to Chinese financing. This is particularly evident in its capital, Addis Ababa, where a slew of transportation projects — from new ring roads to Sub-Saharan Africa’s first metro system — transformed the city.

One of the most striking symbols of Chinese influence in Addis Ababa is the futuristic African Union (AU) headquarters. The $200 million complex was gifted to the city by Beijing in 2012.

Though Ethiopia is a clear example of Chinese investment transforming a country’s infrastructure, a number of other African nations have experienced a similar influx of money from Beijing. This financing pipeline has increased dramatically in recent years.

3. Sri Lanka

In the wake of political turmoil, Sri Lanka is increasingly looking to China for loans. From 2000 to 2017, over $12 billion in loans and grants have poured into the deeply-indebted country.

Perhaps the most contentious symbol of the relationship between the two countries is a port on the south coast of the island nation, at a strategic point along one of the world’s busiest shipping lanes. The Hambantota Port project — which was completed in 2011 — followed a now familiar path. Eschewing an open bidding process, Beijing’s government financed the project and hired a state-owned firm to construct the port, primarily using Chinese workers.

By 2017, Sri Lanka’s government was burdened by debt the previous administration had taken on. After months of negotiations, the port was handed over with the land around it leased to China for 99 years. This handover was a strategic victory for China, which now has a shipping foothold within close proximity of its regional rival, India.

John Adams said infamously that a way to subjugate a country is through either the sword or debt. China has chosen the latter.

– Brahma Chellaney

Playing the Long Game

Africa’s economic rise will likely be a major contributor to global growth in coming years. Already, six of the 10 fastest growing economies in the world are located in Africa. China is also the top trading partner on the continent, with the United States sitting in third place.

OBOR spending has also earned China plenty of influence in the rest of Asia as well. If the ambitious megaproject continues along its current trajectory, China will be the central player in a more prosperous, interconnected Asia.