The government of Andhra Pradesh recently announced plans to implement the Draft Population Management Policy named Poshana - Shiksha - Suraksha from April 1, which aims to incentivise couples to have a third child. The policy proposes cash incentives of Rs 25,000 at the time of birth and Rs 1,000 in monthly assistance for the first five years, along with the offer of free education for the child up to the age of 18.
This announcement is only the beginning of the quick-fix solutions proposed to address the complex issue of declining total fertility rates (TFR) that has become a matter of policy concern for many Indian states. In particular, all five southern states have a TFR of 1.5 or lower, which is comparable to those of many developed nations today.
In the past, these figures would have been celebrated for helping ease the burden of population and resources.
Beyond these short-term policies, declining fertility rates also have to be considered an indicator of a larger structural crisis of care. This article tries to address the various types of costs involved in raising children – not just monetary but also in terms of care responsibilities as well. Who bears these costs and how do they affect individual decision-making processes?
‘Motherhood penalty’
The decisions about whether and when to have children are shaped not only by family preferences but also by the economic consequences associated with motherhood.
A large body of research across various countries documents what is commonly referred to as the 'motherhood penalty' — the adverse impact of childbirth on women's labour market outcomes, particularly in terms of employment continuity, career progression, and earnings. As childcare largely remains a part of women’s responsibilities, motherhood often leads to interruptions in employment or slower wage growth. These labour market costs can significantly shape women's fertility choices.
In India, this disadvantage is clearly visible.
Research shows that the urban motherhood penalty is steep: women's wages fall sharply after childbirth, while men face no comparable decline. Strikingly, the wage penalty is even starker for highly educated women and those in regular or salaried employment than for their less educated counterparts or women engaged in informal wage work.
Women working in the informal sector face a different kind of penalty. While such work may offer flexibility, allowing women to work from home or closer to home, it often comes with the absence of social security, contracts, and stable earnings.
Motherhood also pushes many women toward flexible but lower-quality employment, where the trade-off often involves less pay, fewer benefits, and limited opportunities for career progression.
Policy frameworks do little to mitigate these costs. The Maternity Benefit Act, 1961, which provides paid maternity leave of up to 26 weeks, applies only to formal sector employees. Given that a large share of India's workforce is employed in the informal sector, these protections reach only a small fraction of working women.
Even within the formal sector, some employers find ways to reduce mandated maternity leave. As many of these jobs are precarious, women employees rarely have a say. Moreover, in India the entire cost of maternity leave is borne by the employer, which research suggests incentivises firms to prefer hiring men.
At the same time, paternity leave is not mandated for private sector workers, and in the public sector, it is limited to just 15 days.
Support systems and rising costs
Studies have confirmed that affordable child care facilities have had positive impacts on women’s fertility decisions in some developed countries, such as Japan and Italy. In India, there are existing laws which require the provision of child care facilities at the workplace or within 500 metres.
However, despite the legal requirement, compliance and implementation appear inadequate in the country. The data from some of the popular Indian companies suggest that they provide around 64% of crèche facilities at the workplace, whereas 76% of crèche facilities are within 500 metres.
In 2022, the Union government introduced the Palna scheme, which combined standalone crèche and Anganwadi-cum-crèche facilities. With the introduction of this new scheme, the total number of crèches actually decreased across India between 2017 and 2024, as the financial burden on the state governments shifted.
Child care receives only 0.1% of the total GDP in budgetary allocations now. It is somewhat ironic to note that Andhra Pradesh, the same state that is now announcing incentives to parents with a third child, performed poorly in providing crèche facilities to its female employees when compared to other south Indian states, according to state-wise data.
In many ways, the combination of crèche facilities with the Anganwadi has worsened the quality of child care, as Anganwadi staff are often overburdened and under-compensated. As a result, Anganwadis are not able to provide an adequate support system, which could also act as a deterring factor in family planning choices.
Rising costs of raising children add another layer to the larger societal and familial pressures. Education costs, or what many describe as 'education inflation', have become a major concern for young couples in India. Increasing healthcare expenses, housing constraints in urban areas, and growing aspirations among parents to invest more in the 'quality' of each child’s life further raise the perceived cost of child rearing.
The decline of extended family support in urban areas means couples increasingly depend on market-based childcare arrangements, which remain both limited and expensive, adding significantly to the economic burden on households.
Time and labour cost of childcare
Raising a child involves a lot of time and labour – both physical and emotional – apart from the monetary costs involved in the process. In order to fully comprehend the burden of childcare, we need to consider how it figures in everyday contexts among paid and unpaid activities for women. In the majority of cases, numerous unpaid activities and the mental load fall under childcare and are disproportionately placed on women.
The 2024 time-use survey (TUS) results indicate that women spent about 3.5 hours more than men on unpaid domestic labour and about 62 minutes more on care activities in a day. A further disaggregation of the data suggests that men’s role in the provision of domestic labour is mostly limited to shopping, escorting, transporting and similar chores — activities typically located outside the household, rather than participation inside such as cooking and cleaning.
This indicates that while men still have a choice to participate in various unpaid activities in the domestic sphere, women are expected to take them on without shirking away.
Additionally, women predominantly attend to both domestic chores and childcare even while having a job. The TUS 2024 data shows that while rural women spent an average of 5 hours and 22 minutes in employment-related activities in a day, they spent about 4 hours and 51 minutes in unpaid domestic labour and 2 hours and 15 minutes in unpaid care activities. Their urban counterparts spent about 6 hours and 31 minutes a day in employment-related activities, 4 hours and 45 minutes in unpaid domestic labour and about 2 hours and 22 minutes in care-related activities.
The data simply points out that women, even when they are employed, are not able to reduce their load of household chores and care duties, leaving them double-burdened.
The TUS 2024 also indicates that men’s participation in childcare reduced with increasing household incomes in both rural and urban areas. With regard to the nature of care provision itself in the household, men mostly contribute to ‘childcare and instruction’ — limited to physical care, playing with the children and other minor activities. The bulk of the care work and its mental and emotional load is often taken on by women regardless of their choice.
As care responsibilities fall disproportionately on women in society, with the absence of a reliable support system to alleviate the burden along with unchanged societal expectations regarding gender roles, the monetary incentives might weigh down an already overwhelmed system.
We simply highlight that there is a structural care crisis through these figures and underline the need for a proper support system instead of placing the onus of societal expectations on individuals, burning the candle at both ends.
Swathysree S S is an assistant professor at the International Management Institute (IMI), New Delhi
Anu Mariam Philipose is an independent researcher based in Kuala Lumpur, Malaysia
Debolina Biswas works as an Assistant Professor at Gurudas College, Kolkata
Views are the authors’ own.