India’s growth performance so far this decade has elevated India’s role in the
global economy and generated a new optimism within India and internationally regarding
the country’s future. Global demographic changes support this optimism. Over the next
two decades, India will overtake China as the country with the largest working-age
population. The increase in India’s working population has the potential to fuel
substantial economic growth. However, India has always had a large, rapidly growing
population. Sustaining strong growth will require that the country increasingly and more
productively employ its labor force. Policy discussions within and outside of India often
focus on the need to improve infrastructure, expand higher education, and allow greater
foreign entry. These reforms are critical. However, without complementary progress on
reforms on improving basic education and nutrition, boosting productivity in the
agriculture sector, and easing stifling labor regulations, India may be hard pressed to take
advantage of its population windfall and realize the projections of India’s optimists