China’s central government has announced an annual cash subsidy of 3,600 yuan (around USD 500 or BDT 40,000) for every child under the age of three. The nationwide initiative, aimed at addressing the country’s declining birth rate, was officially launched in January 2025.
According to government data, the subsidy is expected to benefit nearly 20 million families initially. A maximum of 10,800 yuan can be claimed per child over a three-year period.
China has seen a sharp decline in birth rates in recent years. Once the world’s most populous country, it is now facing a population crisis. Only 9.54 million babies were born in 2024. Although this figure is slightly higher than in 2023, it remains alarmingly low and insufficient to sustain future economic growth and labor demands.
While China’s current population stands at around 1.4 billion, the elderly population is rising rapidly, creating a shrinking working-age demographic.
Previously, some local governments had introduced regional incentives to encourage childbirth. For example, Hohhot in northern China offered a one-time subsidy of up to 100,000 yuan for a third child, while Shenyang provides 500 yuan monthly per third child.
This is the first time the central government has introduced a nationwide child allowance scheme. Although the program officially began in January 2025, children born between 2022 and 2024 are also eligible for partial assistance.
Child-rearing in China has become extremely expensive, with the average cost of raising a child to age 17 estimated at USD 75,700 (around BDT 8.3 million), making it one of the most expensive countries in the world for parenting. This financial burden, combined with work-life pressures on mothers, has discouraged many families from having more children.
While experts praise the move as a positive step, they caution that cash subsidies alone may not be enough. They emphasize the need for complementary measures such as affordable or free preschool education, job security and maternity leave for mothers, accessible healthcare, and reduced housing costs. The Chinese government has recently stated its intention to implement free preschool education as part of its broader strategy.
Source: BBC