United States of America Long-Term Rating Lowered To ‘AA+’

United States of America Long-Term Rating Lowered To ‘AA+’ On Political Risks  And  Rising Debt Burden; Outlook Negative

Population Dynamics Ruling the World

Population Maths

The other day i was reading some articles on population and made some quick references to Wikipedia. Population of China is just 120 million more than India and in the last decade alone population in India grew by a staggering rate of 17.5 % compared to 5.4% of China.

China & India population account for almost 19.33% and 17.47%  respectively in the world, and immediately after them is USA which almost 25% of India and is just 4.5%.  The Females % in China & India is almost 48 % , where as in USA females are about 50.8% of the whole population.

Rank	Country / Territory	Population		% of World population	Source
–	World	6,929,400,000		100%	US Census Bureau’s World Population Clock
1	Chinan2	1,339,724,852		19.33%	2010 China Census
2	India	1,210,193,422		17.46%	Provisional 2011 Indian Census result
3	United States	311,705,000		4.5%	Official United States Population Clock
4	Indonesia	237,556,363		3.43%	2010 Indonesian Census
5	Brazil	190,732,694		2.75%	2010 Official Brazilian Census results
6	Pakistan	176,554,000		2.55%	Official Pakistani Population clock
7	Nigeria	158,423,000		2.28%	UN estimate for 2010
8	Bangladesh	150,863,000		2.18%	Official Bangladeshi Population Clock
9	Russia	142,905,200		2.06%	2010 Russian Census
10	Japan	127,950,000		1.85%	Official Japan Statistics Bureau

Population of India at Glance

Indian Population shows a different challenge in itself. Firstly the sex ratio is highly skewed, which statistically says there are less number of women as compared to men, and in absolute terms there are about 3,00,00,000 females short.  Even the literacy rate in women is just 65.46% as compared to 82.14 % in men.

In-depth analysis on population, demographics & lifestyle indicators can revel some more fascinating facts about India.

Will India Become Old Before It Becomes Rich? by A.T. Kearney

Will India Become Old Before It Becomes Rich?

Demographic changes and the impact on business strategies

Business leaders are largely aware of the role that demographics can play in a changing world, yet many executives remain uncertain as to how they can approach this field in their business planning. While tools are available to help understand the impact of population trends on economic activity—such as migration and urbanization patterns—age structure is perhaps the most powerful way to identify changes in consumption, productivity and ultimately demand for products and services.

Over the past decade, a demographic revolution has taken place that will have a dramatic impact on global consumer markets for the next 50 years and beyond. Birthrates have declined sharply in Latin America and in the Islamic world, where several countries, including Indonesia and Turkey, are now at or below replacement levels. By contrast, in North America and Northern and Western Europe, birthrates have sharply increased, with the United States, Britain and France now above replacement levels and Germany recording its highest birthrate for almost 20 years. Conversely, with very low birthrates, Southern and Eastern Europe (including Russia) face a challenging future with few people of working age to support large populations of elderly. China may face the most difficult challenge of all as its working-age population peaks and starts to decline in the coming decade. These and other issues related to aging are on the minds of consumer industry executives worldwide.

The Sweet Spot of Economic Growth

When there is a large workforce and few dependents, a phenomenon called the sweet spot emerges. Today the dependency ratio (those under age 15 and older than 65 versus those who are 15 to 65) is very low, resulting in higher levels of economic growth due to more consumption and investment.

Different countries experience this sweet spot at different points in time, which helps explain periods of economic growth. Much of the recent growth in economies such as China can be attributed to lower dependency ratios. Potential demographic dividends still exist for many countries because we know that countries with increasing numbers of working-age adults, relative to dependent elderly and children, have an opportunity to increase employment, investment and savings. While we may identify the time period in which select countries can realize this bonus, whether or not the demographic bonus is realized depends on public policy and the creation of economic opportunities.

There are commercial implications for each stage of the demographic transition. For example, in countries such as Japan, Germany, the United States and China, retail has increased rapidly during sweet spot periods. Even eating out as a phenomenon rose in Japan and the United States during this time period. However, different stages of the demographic transition present different types of opportunities. For a very young country, the main consumer focus will be on food and nondurable consumer goods. For a country such as China, which is at the zenith of its sweet spot, consumers demand more housing and durable goods. For an aging society such as Japan, consumption will shift and support growth in healthcare and services.

India’s Future

For India, there are three facts to keep in mind while planning for the future:

1. The sweet spot will continue until 2037; in the next 20 to 25 years, the working age consumer group will be dominant. Female earners will become an important part of this group as more women enter the work force.
2. The number of people in the old-age group is expected to increase rapidly (in absolute terms) after 2020. In fact, over the next 10 years, the fastest growing age group in percentage terms will be people older than 55. This presents opportunities and challenges: Opportunities exist in introducing new products and services designed for older people—such as health foods, health services and financial services, among others. The challenges are in lower consumption levels of older people and reduced overall disposable income of the working-age population as old age dependency rises.
3. A detailed analysis of age-wise consumption (for example, intake of various food items over the past five years) reveals three distinct age groups that behave similarly: up to 24 years, 25- to 34-year-olds and 35 years and older.

To this last point, does this mean that “old” age characteristics in India—at least those reflected in buying propensity—start after the age of 35? Not necessarily. Indian consumers do not inevitably start buying every product and service like people age 35 and older. Rather, India has a higher proportion of multigeneration households than developed countries (or even some emergent markets such as China and Turkey), which means specific goods and services are purchased for an entire household. This is a good example of why the commercial implications of demographics have to be calibrated with local customs.

While we recognize that sweet spots are necessary, they are not a sufficient precondition for growth. Bad government policies can frustrate the demographic opportunity just as good policies and good business leaders can overcome the demographic problems of an aging society. So, as the “window of opportunity” remains open for another 25 to 30 years, the key question: How does India improve infrastructure, education and other enablers (for maintaining high and inclusive GDP growth) to ensure that the country becomes rich before it becomes old?

There is a distinct danger that India will grow old before it grows rich if it continues on its current path. Of all the countries that have entered this sweet spot, India currently has the lowest per capita income at around $815 per year, which is about one-third of China’s.1 Even if India grows at a robust 8 to 9 percent per year for another 10 to 12 years, the average income levels will only reach what China’s are today (around $2,200 per year). If India maintains the same growth momentum until 2035, average income levels will be comparable to Turkey and Malaysia today ($4,700-$4,800). In contrast, “young” countries in the sweet spot and competing for investments, such as Brazil, Turkey and Malaysia, have significantly higher incomes to start with (at least five times that of India’s today). Therefore, depending on how quickly incomes rise and distribute in the next 20 to 25 years, India could become a larger middle-class country (with 70 percent or more of the population with annual incomes less than US$10,000), rather than a “rich” country. There will, however, be a meaningful number of both rich and upper-middle-class households (60 to 70 million households with annual incomes of $10,000 or more), which means marketers will have to make sharper choices in terms of identifying target groups, decision makers, products and services, value propositions and operating models, among others.