Importance of Population Projections:

Population projections have become very important in recent times in every field of the economy.

The importance of population projections is as listed below :

1.  Economic Development :

The process of industrialisation and urbanisation, the knowledge regarding the future conditions is not only limited to planners, economists or administrators but today entrepreneurs, traders and customers, too are worried about the future conditions.

On the prevailing growth rate of population in developing countries that are passing through the stage of demographic transition, it is essential for the planners to know that how many houses, schools, teachers, job opportunities and how many quintals of food grains, and how many metres of cloth are to be increased.

All these can be ascertained with the help of projections. Moreover, what should be the trends of export and import and how much foreign investment is required can be roughly estimated through population projections.

The size of population in rural areas, the pace of urbanisation, the possibilities of balanced regional development according to rural-urban population ratio, the contribution of agricultural resources in planning irrigation facilities, the rate of industrial development, etc. are some of the factors which require population projections.

2.  Social Development:

For looking into the future birth rate it becomes necessary to project the factors like level of education, development of education, female education and size of the family, propaganda of family planning, effects of family planning on people, and by how much will the birth rate decline and how many years it will take to achieve any particular growth rate and what will be the changes in the age composition of the population. 

The birth rate can be projected on the basis of these factors.

3.  Business Classes:

Population projections are also necessary for entrepreneurs or business classes. If they know at what rate and of what size the population will increase in future, they will engage their productive resources in accordance with the demand estimated for the future, based on the projected figures.

On the basis of age and sex-wise population projections they can estimate the future demand for their products and plan and produce accordingly. Thus projections play an important role in market mechanism.

4.  Demographic Theory:

In the 1930s, the popularity of the theory of demographic transition created the environment for population projections and its importance. 

With the help of the theory of demographic transition, the particular stage of demographic transition of any country can be known and after how many years it will reach the stage of economic development or what time will it take to pass from one stage to another, can be known by population projections.

5.  Planners :

Population projections help the planners to find out the trends in the growth of population between two censuses.

6.  Migration :

They provide estimates of future trends relating to migration at the national and international levels.

7.  Planning Adequate Investments :

According to the Indian Ninth Five Year Plan, population projections are required for planning adequate investments for: (i) essential necessities such as food, shelter and clothing; (ii) essential prerequisites for human development such as education, employment and health care; and (iii) optimal utilisation of the available human resources for economic and social development.

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