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Spiritual leader Dalai Lama on Saturday said he was counting on young people to create a "happier" century as he celebrated his 78th birthday in southern India with tens of thousands of fellow Tibetan exiles.

"The present-day generation can create better conditions and build a world where everyone can live in harmony and in a spirit of coexistence," the Dalai Lama, who fled Tibet in 1959 after a failed uprising against Chinese rule, told the crowd.

"Youngsters of today have an opportunity to build a happier century," said the maroon-robed monk -- known for his infectious guffaw, oversized spectacles and teachings about peace.

"For those of us from the 20th century, there is nothing we can do now," he said.

The Dalai Lama celebrated his birthday at Bylakuppe, 250 kilometres (150 miles) from Karnataka state capital Bangalore, where the largest camp of Tibetan exiles was set up in India in the early 1960s.

The spiritual leader spoke to some 40,000 Tibetans who migrated from Tibet and settled in India.

In an hour-long speech, he urged people to "practice compassion" and not just think of themselves, adding that education only has value "when you are compassionate towards others".

The Dalai Lama set up his headquarters in Dharamshala, the mist-shrouded northern Indian hill station after escaping Chinese rule.

But some 18,000 Tibetans, including 9,000 monks and nuns reside in Bylakuppe, the largest Tibetan resettlement camp in India that houses two monasteries, temples, schools, hospitals, houses and shops.

Karnataka has the largest Tibetan population in India. Out of the total 120,000 refugees in India, 40,000 live in the three main camps of Karnataka, while the rest are scattered across northern India, according to official figures.

Two years ago, the Dalai Lama announced he was retiring from political duties and upgraded the role of prime minister of the Tibetan exile community.

He devolved power in an attempt to lessen his own totemic status and secure the movement's future after his death.

But he is still the most powerful rallying point for Tibetans, both in exile and in their homeland, and remains the universally recognised face of the movement.

Despite his age, the Dalai Lama keeps up a globe-trotting schedule that would normally tire anyone half his age, aides say.

The close-cropped balding monk, who eats a healthy, mainly vegetarian diet and exercises regularly, supports "meaningful autonomy" for Tibet within China rather than outright independence.

But China, which says Tibetans are better off now because of Chinese investment in the Himalayan region, accuses the Dalai Lama of covertly campaigning for Tibet's independence and calls him a "splittist".