Population policy is suddenly in the news in India with States such as Assam and Uttar Pradesh proposing to bring in or bringing in draft legislation aimed at controlling their populations.
- The Uttar Pradesh Population (Control, Stabilisation and Welfare) Bill of 2021 promotes a two-child policy, according to which those people having more than two children will be barred from contesting local body elections and become ineligible to apply for State government jobs.
- A similar law has also been proposed in Assam, where the the aim of the policy is to reduce the total fertility rate in his State.
According population projection, published by the Union Ministry of Health and Family Welfare in 2019, U.P. will reach a replacement rate (the rate at which women give birth to enough babies to sustain population levels) of 2.1 by 2025, and Assam by 2020.
If the replacement fertility rate has already been achieved in Assam and will be achieved by 2025 in U.P., what is the need for any drastic population policy?
Decreasing fertility rates
- According to the National Family Health Survey (NFHS)-2 data, the total fertility rate (TFR), which is the average number of children that women of reproductive age group have had in their lifetime, in 1998-99 in U.P. was 3.87 for Hindus and 4.76 for Muslims.
- In 2015-16, it decreased to 2.67 for Hindus and 3.1 for Muslims. This means that the TFR declined by 1.2 for Hindus and by 1.66 for Muslims, which is higher.
- The fertility trend for Assam is even starker. According to NFHS data, Assam had a TFR of 3.5 in 1992-93, which decreased to 1.9 in 2019-20.
- Even after such a drastic decline in TFR, the enthusiasm to decrease it even further has no merit other than scoring political points.
- In 1998-99, the TFR for Hindus in Assam was 2.0, which declined to 1.59 in 2019-20. For Muslims, it declined from 3.05 to 2.38 in the same period.
- While the fertility rate of Hindus is less than the replacement level, the fertility rate of Muslims is near that level and will reach there in the near future without any policy intervention.
The point is that fertility rate does not depend on religion. It depends on socio-economic characteristics like education, income, maternal and child health conditions, and other associated factors.
Preference for a male child
The preceding discussion pointed out that the population control policy of imposing a two-child norm is not supported by data. However, it can have other unintended consequences.
Generally, any discussion on fertility focuses on policy recommendations regarding increasing female education, which is no doubt important. However, a single-minded focus on this policy instrument ignores the issue of a preference for male children, which is dominant in the country.
An earlier study of women’s fertility in Hindi heartland States showed that the proportion of graduate women who had two living daughters but still wanted another child was 23.7% in Bihar, 27.3% in U.P. and 28.3% in Rajasthan.
This is nothing but an indicator of a preference for sons in a patriarchal and caste-dominated society. Given such a preference for male children, the two-child norm will only increase sex-selective abortions of girl children, and female infanticide, since couples will want to maintain both the two-child norm as proposed to be enacted by the government as well as their preference for sons.
Problem of ageing
The experience of China also shows that if the state imposes its decision on families’ fertility choices, such a decision is bound to fail. With the one-child policy, the proportion of the aged population is increasing in China.
Fewer younger workers are available, which might result in a slowdown of economic growth. As a result, the government has been forced to relax the one-child policy and adopt a three-child policy.
In India too, as per the population projection report, the proportion of people aged 60 years and above will increase from 13.8% in 2011 to 23.1% in 2036. The two-child norm will only further aggravate the problem of ageing.
Conclusion
The lesson to be drawn is that the decision on children is best made by the family, which can be nudged towards making choices that ensure a stable population growth.
As a famous demographer argued, the fertility behaviour of a couple is a “calculus of conscious choice”. India’s decades-old population policy has achieved replacement level fertility in the country without taking any coercive measures.
Governments should have faith in these time-tested policies and respect the choices of people rather than impose warped and motivated ideas regarding demography on the people.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.