Only 4 per cent households were covered under widow pension, 2 per cent retirement pension and 1.5 per cent under disability pension.

India is home to one-fifth of the world’s population which includes a third of the world’s poor and one-eighth of the world’s elderly. Most of them spend their whole lives as informal workers and have no retirement security other than the hope that their children will care for them in their old age. This arrangement worked well as long as the joint family structure was the dominant characteristic of the Indian society. However, with new social norms eroding the family-based system of support, old-age care for low-income citizens has become a critical challenge. With underdeveloped annuity markets and poor financial literacy, these people face considerable challenges in planning their retirement security. Many elderly citizens are stuck with lives of never-ending work — a fate that may befall millions in the coming decades. We can see a miserable preview for those who don’t have the pensions that previous generations enjoyed.

India is experiencing a demographic transition leading to lower fertility, increased life expectancy, and a consequent increase in the proportion of the elderly. Families are shrinking and transforming into nuclear units. Individualistic attitudes and rising aspirations with the accompanying changes in lifestyles are widening the generation gap. According to the India Human Development Survey (IHDS) of the National Council of Applied Economic Research (NCAER), 45 per cent of elderly males and 75 per cent of elderly females are currently fully dependent on others.

India’s ageing population is expected to grow at more than double the rate of the general population According to Census 2011, India has 10.8 million senior citizens (above 60 years of age). This number is expected to increase substantially in the coming years with a rise in the life expectancy to 65 years from 42 years in1960. In fact it is predicted that between the years 2000 and 2050, the population of India will grow by 55 per cent. However, the population above 60 years and 80 years will grow by 326 per cent and 700 per cent respectively.

Several studies have established that India has a very young and immature pension industry and a population that is not particularly keen to secure its retirement. A mere 7.4 per cent of the total Indian population is covered under any form of pension plans, which is an alarming figure in itself. India spends 1.45 per cent of its Gross Domestic Product (GDP) on social protection, among the lowest in Asia, far lower than China, Sri Lanka, Thailand, and even Nepal.

According to the NABARD All India Rural Financial Inclusion Survey (NAFIS) 2016-17, while 18.9 per cent households reported receiving one or the other kind of pension, of these 32 per cent households reported at least one member above the age of 60 receiving pension. Only 4 per cent households were covered under widow pension, 2 per cent retirement pension and 1.5 per cent under disability pension.

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