The country's population stands at 1.2 billion and is expected to reach 1.53 billion by 2050. But increasing pressure on resources means that there is barely enough water and food to go round.
A pilot project in the Satara district of Maharashtra has proved a success and other states, including Delhi and Assam, are now considering cash incentives.
Satara, funded by the National Rural Health Mission, is offering couples a reward of 5,000 rupees (£62) if they delay having a child for two years (70 rupees a day is a good wage in rural areas). If they wait another year, they receive a further 2,500 rupees.
The birthrate in the district rose from 16.5 births a thousand people in 2005 to 17 in 2007. The project initially attracted 977 couples, but that figure has risen to 2,366.
Satara has about 25,000 marriages a year and 80% result in the birth of a child within the first year. Only 155 couples on the programme left to have children.
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