Rapidly Growing Population
In the under-developed countries, especially in the over-populated countries of Asia, population increases very rapidly. This has very adversely affected their rate of economic growth. In fact.’ rapid population growth is the greatest obstacle to economic growth. Whatever increase takes place in the national output and income in such countries as a result of development is devoured by the ever pouring torrent of babies. It is like writing on the sand. That is why their standard of living and income per capital cannot rise. For example. the major part of increase in national income that has accrued in India during the five-year plans has been nullified by the rapid population growth. As a result, though there has been substantial increase in national income, but the per ca pita income has not increased much. Obviously. a rapidly growing population is a great obstacle in the way of raising the level of living in such countries.
rapid population growth is an impediment to economic growth in as much as it slows down the rate of capital formation. But to accelerate economic growth. it is imperative to step up the rate of capital formation. How can capital formation be stepped up when the per capital income increases slowly on account of a rapid rise in population? A rapidly growing population increases the number of summers in the country and hence consumption expenditure. Owing to increase in consumption expenditure. it becomes difficult to increase the rate of saving and investment which is so essential for economic growth. It is clear that a rapidly growing population retards economic growth by retarding the grow of capital formation.
In the first place, a rapidly growing population requires larger quantity of food- grains. In India,explosive rate of population growth has incarnadine demand for food manifold. This is due to higher income elasticity of demand for food. It has created a serious food problem in the country. India has been importing years large quantities of Grosgrain and losing valuable foreign exchange on this account. If I·here had been no food problem, we would have been able to import plant and machinery and other equipment and necessary industrial raw material all of w his w, could have promoted rapid economic growth in the country.
Unemployed meant is another very serious problem created by rapid increase in population, We know that in India backlog of the unemployed has been increasing at the end of ca h tic-year plan. This is due to the fact owing to rate of capital formation, industrialization has been going on at a slow rate and it has not been possible to increase employment opportunistic commensurate with the rate of population increase. Unemployment means waste of potential manpower resources. Instead of being used in the work of economic development, the unemployed act as a drag on economic progress, since they have to be fed all right even though they arc not making any contribution to the growth of national output.