Have Children, Earn ₹12 Lakh: China Rolls Out Bold Plan to Tackle Population Crisis

International News: Facing an unprecedented demographic downturn, China is now taking drastic steps to reverse its shrinking population. Starting January 1, 2025, the government will offer financial incentives to families for each child born, aiming to encourage childbirth and stabilize its declining birth rate.

₹42,000 Annually per Child for Three Years

As per a report by Bloomberg, the Chinese government plans to provide 3,600 yuan per year (roughly ₹42,000) to mothers for every newborn. This benefit will continue for the first three years of the child's life, totaling around ₹1.26 lakh. Although the State Council Information Office has not officially confirmed the policy yet, it is already generating public interest.

With China’s population currently at 1.41 billion, experts warn that continued decline in birth rates could severely impact the country’s economic and social structure in the coming decades.

Sharp Decline Despite Policy Reforms

In 2023, China recorded just 9.54 million births, nearly half of the 2016 figures. This drop persists even after the One-Child Policy was replaced with a two-child policy in 2016 and later a three-child policy. However, couples have been reluctant to expand their families due to economic pressures, rising living costs, and work-life imbalance.

Additionally, China’s marriage rate is at its lowest in five decades, signaling further decline in fertility rates.

Local Governments Also Offering Housing and Cash

Regional governments are implementing their own programs to support families and boost birth rates. For example:

In Hohhot, Inner Mongolia:

• 50,000 yuan is offered for a second child.
• 100,000 yuan for a third child.

These incentives are particularly effective in low-income areas, where such support makes a significant difference.

Lessons from Other Countries

Other nations have tried similar approaches, with mixed outcomes:

• South Korea increased family subsidies in 2024, resulting in a 3.1% rise in birth rates—the first increase in nine years.
• Japan focused on expanding childcare infrastructure. Since 2005, thousands of childcare centers have been built, leading to a 0.1-point improvement in fertility rate.

Will Financial Support Be Enough?

A recent survey involving 1.44 lakh parents showed:

• Only 15% were initially willing to have more children.
• When offered a 1,000 yuan subsidy, interest rose by 8.5%.

This suggests that financial help can motivate some families—but deeper cultural, economic, and lifestyle changes are still essential for long-term impact.

Can Cash Solve a Population Crisis?

China’s latest move reflects an urgent attempt to address its population imbalance. While monetary incentives may offer short-term benefits, real success will depend on addressing the broader issues: affordable housing, quality childcare, job security, and social acceptance of larger families. As China embarks on this new path, the world will watch closely. This ambitious policy could become a global model—or a cautionary tale—depending on how it unfolds.