Date: 15/09/2022

Relevance: GS-1: Population and Associated Issues

Key Phrases: Ageing world, Services sector, Ageing economies, feminisation of Ageing, Up-skill the working population, Artificial Intelligence, Industry 4.0, Hospitality Management, Kerala Model, technology-oriented services, allied healthcare facilities.

Why in News?

• Services sector contributes over 50 per cent to India’s GDP. The sector has exhibited significant resilience, posting growth even during periods of crisis in the last two decades.
• Going forward, India could widen its horizon and look at other potential service areas, especially the opportunities thrown up by the increasing old age population in developed countries.

Ageing economies:

• The age dependency ratio of high-income countries has been steadily increasing and stands at almost 55 per cent.
• The age dependency ratio in Japan has risen 26 per cent between 1990 and 2021 — with 70 per cent dependent on the 15-64 working age — the highest among high-income countries.
• A similar increase of around 10 per cent has been seen amongst other developed countries as well, the most significant being Germany and France, with a dependency ratio of 56 per cent and 63 per cent, respectively.
• The UK and the US, which have a significant Indian diaspora have also seen a rise, though a gradual one, with the dependency ratio of 57 per cent and 55 per cent in 2021.

The feminisation of Ageing:

• The male population above 65 in Japan has increased from 9.7 per cent in 1990 to 25.7 per cent in 2021, and the aged female population from 13.9 per cent to 31.6 per cent.
• In countries like France and Germany the population above 65 years amongst men stands at 18.9 per cent and 19.6 per cent, respectively, while that of women at 23.2 per cent and 24.3 per cent.
• As of 2021, the UK’s ageing male population stood at 15.5 per cent and the ageing female population at 20.1 per cent, while in the US it was 17.6 per cent and 18.6 per cent, respectively.
• In the case of Australia, it stands at 15.6 per cent for males and 17.8 per cent for females as in 2021.

India’s opportunity:

• Up-skill the working population:
  • These demographic challenges in the developed world offer an interesting opportunity for India where just 6.3 per cent of the male population and 7.3 per cent of the female population is above 65.
  • The burgeoning population is often considered an economic dividend for India. There is a need to up-skill the working population to reap the potential.
• Use of Artificial Intelligence:
  • To overcome the shortcomings of an ageing society, developed economies are focussing on artificial intelligence (AI), Industry 4.0, etc., which could reduce the required human interventions. o AI will not only be able to assist doctors in take better and informed decisions but in some cases also allow people to make informed decisions without possibly visiting a doctor.
  • AI can predict potential issues, reach out to customers in time, and ensure their satisfaction.
  • AI today would possibly do to the world what computers and information technology did decades back.
  • All top Indian institutes across fields should design courses to leverage the opportunities offered by developed economies.
  • China recently announced its intention to become ‘a principal world centre of artificial intelligence innovation’ by 2030.
• Hospitality management:
  • While most developed countries have a good social security system, their support system will come under strain going ahead.
  • This is an area India can explore by offering hospitality management in developed economies.
  • Indians knowing foreign languages with a pleasant disposition could be suitably placed in developed countries as their working population reduces.
  • India has a huge opportunity to cater to the space by deploying better-allied health personnel. These could be doctors, nurses, and paramedical staff.

Vocational courses:

• 15.8 per cent of the nurses in OECD countries are foreign-born, which is evidence of the tremendous opportunity that exists.
• Recognising this opportunity in developed economies, the Centre should set up vocational training courses for young Indians on new languages, customs, and processes.
• The possible involvement of the embassies of these countries in setting up these courses will help to further strengthen relationships between the two.
• Japan had signed an agreement under the Specified Skilled Workers (SSW) programme to onboard trained nurses from India a few years back.

Kerala Model:

• States could draw from the success of the Kerala model that has sent abroad a significant number of skilled nurses.
• Kerala has launched an initiative to provide free European language training to tribal nursing professionals to help them migrate.

Way forward:

• While technology-oriented services and allied healthcare facilities have the potential to play a significant role in India’s services exports and contribute to ageing economies in the developed world, there is an immediate need to upgrade the skills in both these areas.
• Integrated coursework could be designed for a year, pursuant to which a certified degree could be awarded that is recognised overseas.
• Towards this end, India needs to have a mutually recognised agreement (MRA) of such courses to incentivise Indians to tap job opportunities abroad.
• Developed countries need to also support it for their benefit.
• While AI would require technology interventions and training, in soft skills there is a huge opportunity abroad, which States must learn to tap.
• Discovering opportunities in the services sector beyond information technology would not only help earn foreign exchange for the country but also facilitate economic diplomacy.

Source: The Hindu BL

Mains Question:

Q. “Given the demographic profile, India is uniquely placed to provide services to the ageing societies of the developed world.” In light of the statement, discuss the opportunities in the services sector beyond information technology for India.