The demographic dividend, which has begun in India and is
expected to last another few decades, is a great window of opportunity.
The demographic dividend is basically' a swelling in the working age
population, which conversely means that the relative ratio of very young
and very old will, for a while, be on the decline, From -the. experience
of Ireland and China, we know that this can be a source of energy and an
engine of economic growth. The demographic dividend tends to raise a
nation's savings rate since in any nation, it is the working age
population that is the main saver, and since the savings rate is an
important driver of growth, this should help elevate our growth rate,
However, the benefits of demographic dividend depend on the quality of
the working age population. And this implies bringing back the
importance of education, acquisition of skills and human capital.
Statement 2 is correct. The passage explicitly defines demographic dividend as "a swelling in the working age population, which conversely means that the relative ratio of very young and very old will, for a while, be on the decline." This directly supports the assertion that the relative ratio of very young and very old will decline for a while.
Statement 1 is incorrect. The passage emphasizes the importance of education, skill acquisition, and human capital for realizing the benefits of a demographic dividend. However, it does not state that the number of illiterate people will necessarily decrease as a direct consequence of the demographic dividend itself. The dividend presents an opportunity for human capital development, but a reduction in illiteracy requires specific policy interventions and is not an automatic outcome mentioned in the text.
Statement 3 is incorrect. The passage focuses on the economic implications of a changing age structure, specifically the rise in the working-age population and its potential impact on savings and growth. It does not discuss the stabilization of the population growth rate as a direct or immediate effect of the demographic dividend. While demographic transitions often lead to eventual stabilization, the passage does not establish this as a consequence of the dividend within the given context.