India’s birth rate is now below replacement. Edelweiss CEO warns: ‘This changes the long term math of…’

India’s fertility rate falling below the replacement level should trigger a new economic debate, Radhika Gupta, Managing Director and CEO of Edelweiss Mutual Fund, said on Sunday. She also said the demographic shift could alter the country’s long-term growth trajectory.

In a post on Sunday, Gupta said India’s fertility rate dropping below the replacement rate of 2.1 means the country is no longer having enough children to replace its population over time. “India’s fertility rate falling below replacement rate should open a new economic conversation,” she wrote on X. 

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While India continues to benefit from demographic momentum because of its relatively young population, she said the trend “changes the long-term math of growth.” 

“When fewer children are born, every worker matters more. Productivity matters more. Skills matter more. And female workforce participation matters much more,” she said. 

The Edelweiss CEO’s remarks came after a widely shared post highlighted that India’s total fertility rate (TFR) had declined from 2.3 to 1.9 over the past decade, slipping below the replacement level. The accompanying chart shows several Indian states now recording fertility rates comparable to, or even lower than, those seen in developed economies.

According to the chart, Delhi’s fertility rate stands at around 1.2 births per woman, lower than Finland’s and close to China’s. Kerala, Tamil Nadu, and West Bengal were estimated at about 1.3, while Telangana was at 1.5. Rajasthan (2.3), Uttar Pradesh (2.6), and Bihar (2.9) continue to report higher fertility rates.

Gupta said the decline in fertility creates a challenge that many developed economies have already faced. “But this also creates a tension many developed economies have already experienced: as women become more educated and participate more in the workforce, fertility rates often fall further,” she said.

Rejecting the idea that women’s workforce participation is the issue, Gupta added: “So the real question is not: Should women work? That answer is obvious, economically and socially.” 

Instead, she argued that policymakers and businesses should focus on making careers and family life compatible. “The real question is: How do we make careers and family sustainable together?” she said.

The Edelweiss CEO pointed to countries that addressed the issue through practical support systems rather than rhetoric, citing childcare, flexible work arrangements, shorter commutes, family support systems, and organized care infrastructure.

“For years, we thought of infrastructure as roads, ports, and power. In the next phase of India’s growth, childcare and care infrastructure may become equally important economic infrastructure,” she said.

She concluded by arguing that demographic participation itself could emerge as a key economic driver in the years ahead. “Not just AI. Human participation itself may become one of the biggest growth drivers.”

Tesla CEO Elon Musk also reacted to the post, writing: “India’s birth rate has fallen below replacement. Among those most educated, India’s birth rate fell below replacement many years ago.”