Why A.P.’s incentive for having more children is misplaced

Account subscription benefits alongside Premium Stories, Editorials, Opinions and more. Unlock these with Subscription

The View From India Looking at World Affairs from the Indian perspective.

First Day First Show News and reviews from the world of cinema and streaming.

Today's Cache Your download of the top 5 technology stories of the day.

Data Point Decoding the headlines with facts, figures, and numbers

Health Matters Ramya Kannan writes to you on getting to good health, and staying there

The Hindu On Books Books of the week, reviews, excerpts, new titles and features.

Less than 10% of Indian respondents said they would prefer to have three, four or more children | Photo Credit: JOTHI RAMALINGAM B

On May 16, Andhra Pradesh Chief Minister N. Chandrababu Naidu announced a one-time incentive of ₹30,000 for the third child and ₹40,000 for the fourth. He said that these incentives were a part of the State’s new population management policy to encourage population growth.

On the surface, the incentives to have bigger families may sound sensible with the latest National Family Health Survey (NFHS-6) report for the year 2023-24 placing the State’s fertility level at 1.8, which is below the replacement level of 2.1. However, a closer look warrants questions on at least three fronts: whether such an incentive is adequate for families to have more children; what the key reasons are for the dropping fertility rate; and whether such an intervention is necessary now.

A comparison of this one-time cash incentive against basic expenditures shows that it cannot offset the childcare costs, a concern that is prompting families to rethink having more children.

The government’s incentive is about twice the average cost of hospitalisation for childbirth in India, and a far smaller multiple of the cost in Andhra Pradesh. In fact, it is almost the same as the cost of hospitalisation for childbirth in the State’s urban area. In a State where more than 50% of births happen in private hospitals and about 52% of all deliveries happen through Caesarean sections, this incentive will just offset the hospitalisation cost in rural areas (Chart 2). It is also inadequate to cover the cost of C-sections in private hospitals in urban areas.

For a family of five (assuming there are two adults and three children), this incentive is about 1.5 times their Monthly Per Capita Expenditure (MPCE) in rural areas and almost similar to the MPCE in urban areas, as per the Household Consumption Expenditure Survey for 2023-24. This means that the incentive could just help the families meet