South Asia is approaching a new demographic phase—one that will reshape education systems for decades. Today, it has the second-largest population of children under age 15 in the world, after Sub-Saharan Africa. But that is beginning to change. By 2050, the region’s under-15 population is projected to decline by about 16 percent, from 420 million in 2024 to 352 million.
This demographic transition matters because it will directly affect how education systems plan, finance, and deliver services. Across the six countries in the region—Bangladesh, Bhutan, India, the Maldives, Nepal, and Sri Lanka—major progress has been made over the past two decades in expanding access to schooling even as the number of young people was rising. Almost all children across the region enroll in primary school at the right age, and participation in secondary education has also increased significantly.
Yet access is only part of the story. The central challenge now is the quality of education. In countries such as Bangladesh and India, more than half of children at the end of primary school are in learning poverty, meaning they cannot read and understand a simple age-appropriate text. This is the core education policy problem facing the region: South Asia has made impressive progress in getting children into school, but far too many are still not learning enough once they are there.
At the same time, these learning gaps persist in a context of limited public investment. On average, South Asian countries spend about 3.7 percent of GDP on education—below the 4 to 6 percent range often cited in international benchmarks. But the challenge is not only how much is spent. It is also how effectively resources are used. In many cases, spending remains concentrated in areas that do not always generate the strongest gains in student learning.
That is where the region’s demographic transition opens a new opportunity to strengthen education policy—and to spend better, not just more.
In countries with shrinking school-age populations, fewer students can create an opportunity to reallocate resources toward improving both coverage and quality. But this opportunity—linked to what is often referred to as a demographic dividend—is not automatic. Falling student numbers do not necessarily reduce costs, because education systems carry fixed expenses such as school buildings, administration, and transport networks do not shrink on their own. Without reforms, per-student costs will rise while learning outcomes remain weak.
That is the central message: demographic change can create room to improve education, but only if governments actively manage the transition.
A new World Bank Group paper analyses public education spending into key components—demographic change, enrollment, and spending per student—and projects how education spending as a share of GDP could evolve under different scenarios from 2020 to 2050. The findings suggest that, even without other reforms, demographic change and the declining number of young people alone could create meaningful fiscal space to reinvest in education. By 2050, that fiscal space at the regional level is estimated at about 0.53 percentage points of GDP for primary education (relative to 2020) and 0.47 percentage points for secondary education.
Put simply, demographic change could free up resources that countries can reinvest to improve education quality—and reach the children who are still being left behind.
Even after accounting for an ambitious expansion toward universal enrollment in pre-primary, primary, and secondary, the analysis suggests that demographic change could still leave meaningful fiscal space for reinvestment, with increasing per-student public education spending as a share of GDP per capita even up to current high-income country levels by 2050. This matters a lot for countries trying to turn access gains into learning gains—without putting additional pressure on public budgets.
