In 2050, India will be a capitalist economy with the bulk of the economy under private sector management. The goals of poverty elimination and social protection would no longer be reachable by deploying vast amounts of budgetary resources and public sector benevolence. A much more structured, policy-oriented approach that combines capitalism and social justice will be required. Take the issue of poverty. The relationship between economic growth and poverty reduction is clearly positive, as suggested by the substantial reduction in the headcount ratio of poverty during the high-growth period, from 37.2 per cent in 2004-05 to 29.8 per cent in 2009-10. Over a longer period of two decades, the decline has been about one per cent a year. However, one cannot rely on growth alone for poverty reduction. One needs policies for inclusion, particularly those relating to education and to the access to credit and other resources. Moreover, some things done for growth are harmful for poverty alleviation. Land acquisition, for example, has already posed problems and may pose even bigger ones as the country urbanises and industrialises. Relying on growth alone will not be sufficient either, because much of the poverty that remains involves addressing left-out regions and left-behind groups concentrated in some areas or population groups – for example, ethnic minorities. Such left-out groups can acquire a destabilising political salience, as we see now in the tribal Naxal areas. The challenge of reaching left-out regions can be addressed if the locus of growth shifts towards the northern states, where the bulk of poverty is concentrated. This is also the area where the bulk of the so-called demographic dividend will accrue; and it makes eminent sense, even from a growth perspective, to ensure that states such as Uttar Pradesh, Bihar, Jharkhand, Madhya Pradesh and Rajasthan become the new centres of rapid growth. This involves policies for promoting growth, strengthening infrastructure and building up skills rather than large fiscal hand-outs for employment schemes or food subsidies or farm loan waivers. These huge drafts on the budget may have a role now, although even that is questionable. But they are not the way to address poverty-related challenges in 2050. The challenge of reaching left-out groups, such as tribals, Dalits and Muslims, is sought to be tackled these days through reservations in education and public sector jobs. This may be desirable for now when the representation of these groups in these areas is well below their proportion in the population and their potential. Hopefully by 2050 the situation will be more equal, and policies can focus more on skill development and credit access than on legal reservations. However, the real challenge is the political one. It involves ensuring that these left-out groups are able to influence the democratic process to be more sensitive to their concerns. This has already happened to some extent with Dalits and Muslims. But tribals lack a strong enough political voice at the Centre, and any political party that chooses to address this will be doing a major national service. The other, related issue that will become more acute is of protecting people near the poverty line (on both sides of it) from vulnerability to sudden demands such as catastrophic health expenditures or recovery from disaster. This vulnerability to economic downturns will also affect wage labour and those running micro-enterprises; their access to agriculture back in their native village as a fallback in bad times will come down as the numbers of the non-agricultural workforce increase and as more and more of them become second- or third-generation urban residents. The vulnerability to pollution-related health hazards will be an additional dimension. By 2050 India, like every capitalist economy, will need a system of social insurance covering health care, unemployment and old age needs. The Aadhaar card can help consolidate the many schemes that exist today and can provide a virtual one-stop window for all entitlements. It can be the basis for a completely new social security administration. Today, middle-income countries spend roughly six per cent of their gross domestic product (GDP) on healthcare. This is about 50 per cent more than the current proportion. This means that, with GDP growing at six per cent, healthcare spending will go up fifteen-fold. If borne largely by households, as at present, this is a substantial burden, particularly when near-poverty-line households are faced with catastrophic health expenditures. By 2050, we will have to design a viable system of healthcare based on insurance for pooling of risks and public provision for health interventions, such as immunisation, that have large public benefits. No country has so far successfully designed a scheme that is financially viable and that provides the requisite level of healthcare protection. We will have to design something that will probably involve a mix of private care for routine medical needs; public provision where public health issues are involved; insurance systems to protect against major illnesses; a geographically more diffuse availability of facilities so as to reduce the cost and inconvenience of travelling for healthcare; and a drug policy that ensures affordable medicines. In 2050, the bulk of non-agricultural employment will be in the private sector. Traditional fallbacks in bad times, such as family support, will no longer protect the workforce against economic vulnerability. India will hopefully also be at near-full employment. Hence some form of unemployment insurance will be necessary both for wage employees and for the self-employed in micro enterprises. Both health insurance and unemployment insurance will involve the government and the private sector. Indian employers will have to accept that the survival of the capitalist system, on which they depend, requires this commitment from them for social protection of their workers. Old age pension is more of a public provisioning issue. To some extent, one relies on people saving for their retirement and the role of public policy is to correct the myopia that stops them from doing enough of it. But beyond this, some form of old age protection for those whose working incomes were never sufficient for this purpose will be necessary. By 2050 India will have the means to provide social protection to the vulnerable as a safety net that protects them from a catastrophe. The challenge is to learn enough from the experiences of more advanced capitalist economies to design a system that delivers social protection without running into intractable budgetary problems.