The Cheat Sheet: India retires hurt


A match report?

Of a different kind. The case in point is the latest Global Retirement Index (GRI) prepared by Natixis Global Asset Management, a Paris-based company, which basically tells you India is one of the worst places in the world for life after retirement.

That’s surprising!

The Natixis Index has ranked 43 important countries, and India sits at the bottom. The list has 34 countries from IMF’s advanced economies, five from the OECD and four from BRICS, which India is part of.

So, who’re the toppers?

Norway, Switzerland and Iceland are among the top three. The US is in 14th position. In fact, this time Natixis scanned only 43 nations, as against 150 last year. Also, this year, the researchers considered the five-year average of real interest and inflation rates, against a three-year average last year.

Does that mean those who retire in India are left with less — or even zip — savings?

Indeed. Most earn much less and save less. India’s working population doesn’t enjoy enough safety measures and contract jobs are rising alarmingly, ripping workers of benefits and welfare. Nor does India have a strong law on minimum wages. This makes life in the informal sector a nightmare.
Juxtapose that with the country’s abysmal social security track record and you get a suitably grim picture. Mind you, the number of Indians aged over 60 have reached a record peak. The elderly now account for 8.6 per cent of our over-120 crore population. In April this year, a report by the statistics ministry said that the number of citizens over the age of 60 jumped 35.5 per cent — from 7.6 crore in 2001 to 10.3 crore in 2011, a record since 1950. It is almost twice the rate (17.7 per cent) at which the total population grew.
Another report notes that half of India’s elderly population lives below the poverty line. Now, that’s cause for worry.


HelpAge India, a nonprofit, estimates that the number of the elderly will cross 1.4 crore by 2021, and by 2050 will account for 20 per cent of the population. This slice of stats should be an eye-opener for policymakers. Clearly, social security measures for the aged and the retired need considerable changes.

What matters most is healthcare, I guess.

You bet! India’s performance in the GRI’s sub-index for health — 4 per cent — was the worst among the 43 nations it studied. Also, India has the lowest ranks for health expenditure per capita, non-insured health spends, and life expectancy out of all countries measured this year. The report says people in urban India have greater access to adequate healthcare services, but a massive chunk of the rural population is still denied basic healthcare.

Yeah, in many villages, quality of life is a myth.

In the GRI, India ranks last in the quality of life sub-index, too; it comes second-last in finances in retirement and third-last in the material well-being sub-index. Within quality of life, we have the second-worst score for biodiversity in the entire GRI and the worst scores for air quality, happiness, and water and sanitation. Low scores in air quality and environmental indicators reflect high levels of water and air pollution in large cities.

This is bad! What do we do?

To figure that out, the GRI notes that each topper provides solid best practices for ensuring retirement security. The report highlights four core trends for policymakers. These include ensuring access to alternative saving methods, offering tax incentives for retirement savings, ensuring workers have the right balance of investments and education, and having the right mix of economics by enhancing monetary, fiscal and healthcare policies.
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(This article was published on July 27, 2016)


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