Thursday, September 29, 2005

What's Your Age???

I just turned 27 this month. But if you divide the country’s population based on age, I’ll fall into the senior and less populated segment. Suddenly it all fills me up with nostalgia about my younger days. Shut up!!!!! I am still young and will be so for years to come.

But the size of younger segment and an opening economy has really changed the face and soul of our society. So has been the extent of changed that one of my friend changed his decision of shifting his kids from US of A to India because he found us a bit too modern for his liking. Believe me, I am not exaggerating.

There have been drastic changes in spending patterns. Spurred by the liberalization process, there has been a gradual move away from a supply-constrained economy to a demand-driven one. Moreover, the typical Indian consumer's mindset has changed as well. Austerity is no longer considered a virtue and debt is not a taboo any more in a typical middle-class Indian family.

As per KSA Technopark survey, 12.1% of annual income used to go in savings and investments in 1999. In 2002, the figure dropped to 5%. Spending on home appliances, movies, eating out, health care and so called hang-out activities have been much more than ever before. With so much of youth, we proudly say, “We have a productive future”.

Although I agree, these survey teams never reach the poorest and darkest parts of the country. Such an economy does lift the standard of living of middle class but it does increase the divide between those who badly need and those who already have.

But what is the fate of this demand driven and consumption based economy after 10 years. If the average age of country is around 25-30 currently, it will be touching 35-40 in next 10 years.

Come ‘on, at 40 you cannot go out and booze everyday. You will have kids to worry for. You will have the cut off for retirement of 58 years to watch for. And you will have a whole lot off things to watch for. Suddenly the spendthrift youth will turn a “save for future” matured. The saving bug will catch up with most of us. It might well be a U turn to supply driven and saving based economy. But what about all these pubs, malls, cinema halls?

Its not that whole nation will turn old. But they will definitely draw lesser crowds and hence face a challenging economical misbalance.

This is the problem, if a country has age distribution which is dominated by a particular age group. The fate of the economy becomes highly age driven. It gets into a vicious cycle and takes ages to come out of it.

But vision and economics are the two words non existent in my dictionary. So if even a synonym of one of these two words exists in your dictionary, you have all the rights to disagree with me. But that does not deny me of my right of writing any crap I like.


Spiff said...

actually the trend that u mention ll be accentuated even more in the next 20 years and this not so harmful either otherwise us wont grow at the rate it is growing not to worry..mebbe japan's example can be shown as bad effect of senecsense on economy but lets reach the japan's level of econom y then worry

Vibhash Prakash Awasthi said...

I have just looked at a "could be" scenario. But truth of the matter is, we do have a youth dominated population. For next few years, it'll give us an productive population, but this will also have its adverse effects later whn youth tunrs old.

Spiff said...

so difficult to really guess

Vibhash Prakash Awasthi said...

It will'll arise much sooner!!!

Spiff said...

do some research mister bakar