When Andhra Pradesh Chief Minister N Chandrababu Naidu recently proposed a cash incentive of Rs 25,000 for couples having a second or third child, it revived an important question about India’s demographic future: Can governments reverse falling birth rates through financial incentives? Andhra Pradesh today records a total fertility rate of roughly 1.4 children per woman, significantly below the replacement level of 2.1. Concerned about the long-term economic fallouts of an ageing population, the state is exploring ways to encourage larger families.

The idea of paying couples to have more children may appear bold. Yet India has already seen a similar experiment, one that has been underway for several years in Sikkim. If Andhra Pradesh is worrying about low fertility, Sikkim has been living with it for some time. It has the lowest fertility rate in India, about 1.1 children per woman, comparable to some of the lowest fertility societies in the world. Concerned about the implications of such a decline, including population ageing and a shrinking workforce, the Sikkim government decided to intervene.

Around 2022, the state rolled out a series of incentives designed to encourage couples to have more children. These amounted to perhaps the most comprehensive pro-natalist policy attempted by any Indian state. For government employees, the state introduced salary increments linked directly to childbirth. One additional increment was offered when a second child was born and two increments when a third child arrived. The idea was straightforward: If raising children became financially less burdensome, families might feel encouraged to expand.

But the policy went much further. Women government employees were offered state-funded childcare attendants to assist them after childbirth. This was intended to........

© Indian Express