"India's present rate of population growth translates into 16 million more Indians every year, rising almost to 18 million a year by 2016 and the failure to stabilise the population will have a significant implication for the future of India's economy," he said while delivering a lecture on 'Population and economic development in India' in Mumbai.
"Economic growth and prosperity is not ensured by an expanding population but by what economists call 'good human capital' and the key to create good human capital is human development," he said.
However key indicators show India has fallen behind in its efforts in human development," Murthy said pointing out that India is ranked 127th among 177 countries on the human development Index.
He pointed that the high population densities have led to overloaded systems and infrastructure in urban areas and nearly 72 per cent of India's population will be urbanised by 2030 and India will be required to construct 3.6 million housing units in urban areas every year.
Murthy said according to the World Bank resource degradation cost, the Indian economy with 4.5 per cent of GDP annually and common property such as grasslands has declined by 25 per cent through encroachments and over-cultivation.
He said the water table in India is falling by an average of six feet every year and it is predicted that the country will face severe water scarcity by 2025.
"An estimated half of India's 329 million hectares of soil is degraded and India will lose all its productive land to desertification within 200 years if the present annual loss of land continues," he said.
Speaking about future consumption of India's resources, he said the per capita consumption level in India is one-twentieth compared with Europe, however with economic growth, approximately 30 million people are entering India's middle class every year and India's household consumptions is expected to double to $510 billion by 2008.
Murthy termed India as one of the fastest growing economies in the world and pointed out that it was India's low cost but skilled labour force which has been an important driver in its economic growth so far.
He said 36 per cent of India's one billion population is below the age of 15 years and this means that by 2020, 325 million people in India will reach working age.
India will have largest working population in the world and this expected rise in India's working population comes at a time when the developed world is faced with large ageing populations, Murthy said.
It is estimated that by 2020, the US will be short of 17 million people of working age, China by 10 million, Japan by 9 million and Russia by 6 million while India will have a surplus of 47 million working age people, he said.
