DHAKA, Oct 10, 2024 (BSS) - Growth in South Asia is expected to increase to
6.4 percent this year, exceeding earlier projections and keeping the region
on track to be the fastest growing in the world, according to the World Bank
(WB).

Unlocking untapped potential by increasing women's participation in the labor
force and opening further to global trade and investment could help the
region grow even faster and achieve its development goals, said the WB in its
twice-yearly regional outlook.

Released today, the latest South Asia Development Update, Women, Jobs, and
Growth forecasts a broad-based upturn in the region, supported by strong
domestic demand in India and faster recoveries in most other South Asian
countries, said a World Bank press release.

Growth is expected to remain robust at 6.2 percent a year for the next two
years. This forecast is subject to downside risks including extreme weather,
debt distress, and social unrest.

Policy missteps such as delays in planned reforms could also set the region
back. Fragile fiscal and external positions leave little buffer against these
risks. "South Asia's outlook is undoubtedly promising, but the region could
do more to realize its full economic potential," said Martin Raiser, World
Bank Vice President for South Asia.

"Key policy reforms to integrate more women into the workforce and remove
barriers to global investment and trade can accelerate growth. Our research
shows that raising female labor force participation rates in the region to
those of men would increase regional GDP by up to 51 percent." he added.

Female labor force participation in South Asia is among the lowest in the
world. Only 32 percent of working-age women were in the labor force in 2023,
compared to 77 percent of working-age men in the region.

For all South Asian countries except Bhutan, female labor force participation
rates in 2023 were 5 to 25 percentage points lower than in countries at
similar levels of development.

This shortfall in the female labor force is most pronounced after marriage.
On average, once married, women in South Asia reduce their participation in
the workforce by 12 percentage points, even before they have children.

The shift toward service activities, usually associated with greater demand
for female labor, has not yet led to higher levels of female employment in
the region, and firms often state an explicit preference for male workers.

Supply-side constraints such as childcare access, mobility and safety, legal
restrictions, and conservative gender norms are also significant barriers.

"South Asia's female labor force participation rate of 32 percent is well
below the 54 percent average in emerging market and developing economies,"
said Franziska Ohnsorge, World Bank Chief Economist for South Asia.

"Increasing women's employment requires action from all stakeholders. Our
report recommends a multi-pronged effort where governments, the private
sector, communities and households all have a role to play." added the
official.

The report's recommendations include legal reforms to improve gender
equality, measures to accelerate job creation, and removal of barriers to
women working outside the home such as lack of safe transport and quality
child and elder care.

Such measures could be more effective if social norms became more accepting
of female employment. Another key area of reform is increasing trade
openness. Most countries in South Asia rank among the least open to global
trade and investment.

This greatly limits the region's ability to take advantage of the reshaping
of global supply chains. Within the region, greater export orientation has
been linked to greater female employment.

Therefore, increased openness could help the region spur growth as well as
boost job creation, especially for women, said the outlook.