Although china has the largest population in the world, what explains the country's declining NIR?

China has declining NIR because of the measures set to prevent the families from having more children.

Explanation:

China is the country with the biggest population in the world, having over 1.3 billion people. For comparison, this is aproximately the same as all of Europe and all of North America combined. It is not just nowadays that China is the most populous country, but it has been for several thousands of years now.

Things seem to gradually change though, and this can be easily noticed by China's declining NIR. This has actually been done on purpose by the Chinese government, almost half a century ago. Seeing that if the population continues to grow exponentially there will be huge problems, the government made a law that allowed the families to have only one child (though there were exceptions), and only a few years ago it was allowed that the families can have two children. While this has solved the problem with the rapid population growth, it opened up another, the population is aging quickly.