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1. India’s personal data protection act and the politics of digital governance

Author:
Stephen Weymouth
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
Atlantic Council
Abstract:
India recognizes the importance of establishing policy foundations for digital commerce, as cross-border data flows are essential to firms in all sectors, not just in technology. In manufacturing, three dimensional printing and robotics are revolutionizing production processes. Agriculture is benefiting from sensors and analytics, which optimize crop yields and resource usage. Healthcare is being transformed by electronic medical records, health information exchanges, and algorithms that analyze patient data and detect illness. Financial services are using blockchain technologies and AI to enable faster and more secure transactions. All industries rely on electronic payments, data analytics, and cloud storage to streamline various processes. With customers located worldwide, cross-border data flows are the byproduct of digital transactions. Data privacy frameworks can facilitate these flows by building consumer trust, thereby unlocking innovation and efficiency in all sectors. Given the significance of cross-border data flows to its economy, India has actively engaged in multilateral and bilateral discussions on digital trade governance. It is a member of the Quadrilateral Security Dialogue (Quad), a strategic forum comprising the United States, Japan, India, and Australia, a possible venue for coordination on digital governance. India has also joined the Indo-Pacific Economic Framework (IPEF), a US-led framework for economic cooperation which will facilitate conversations seeking “high-standard rules of the road in the digital economy, including standards on cross-border data flows and data localization.” The US-India Initiative on Critical and Emerging Technologies (iCET), launched by Indian Prime Minister Narendra Modi and US President Joe Biden during the Quad summit in May 2022, presents an opportunity to build India-US trade ties through an industry-focused agenda. Finally, India and the United States have launched a new bilateral Defense Industrial Cooperation Roadmap to accelerate technological cooperation. This issue brief delves into the politics of India’s evolving digital governance, focusing on the draft Digital Personal Data Protection Bill of 2022 (DPDPB). The DPDPB aims to balance the interests of Indian consumers seeking enhanced privacy and data security against the business need for unconstrained data flows. The government’s responsive approach to stakeholder feedback on previous versions of the bill indicates that achieving these goals is feasible. However, concerns persist about ambiguities surrounding data transfers and institutional arrangements that exempt the government from complying with the law in ways that may encourage surveillance and censorship of opposing viewpoints.
Topic:
Economy, Business, Rule of Law, Data, and Data Governance
Political Geography:
South Asia and India

2. Do Minimum Wage Hikes Lead to Employment Destruction? Evidence from a Regression Discontinuity Design in Argentina

Author:
Nicolás Abbate and Carlos García Jiménez
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
In this study, we examine the impact of eight minimum wage increases in Argentina during the early 21st century by analyzing administrative records of registered employment. Utilizing a regression discontinuity design, we compare job separation rates between a group affected by the minimum wage hikes and a control group slightly out of their legal scope. We show that this method improves upon previous methods by reducing the likelihood of Type-I error. Overall, we find that the minimum wage hikes had no significant effect on job separation rates. However, the increases implemented in 2008 resulted in a decrease of 4.8 percentage points (19%) in separations, indicating that the employment effects of minimum wages may not necessarily lead to job loss.
Topic:
Employment, Economy, and Minimum Wage
Political Geography:
South Asia and Argentina

3. What Do We Really Know about Productivity Differentials across Countries?

Author:
Jayati Ghosh
Publication Date:
04-2022
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
This paper examines and critiques the most widely used measure of productivity (output per worker employed) and argues that this is a flawed, inadequate and even misleading measure of economic progress. In terms of cross-country comparisons and assessing trends over time, both the numerator (GDP or value added) and the denominator (number of workers or hours worked) have significant conceptual and measurement problems. These issues are considered in general, and also with regard to how they affect analyses of productivity differentials in the U.S. and India in the recent period.
Topic:
Political Economy, GDP, Employment, Economy, and Productivity
Political Geography:
South Asia, India, North America, and United States of America

4. India Emerges as a Key Power and Important Partner for the EU in the Indo-Pacific

Author:
Patryk Kugiel
Publication Date:
09-2022
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
India’s commissioning of its second aircraft carrier, the INS Vikrant, in September this year reaffirms the country’s aim to play a leading role in the Indo-Pacific. The country’s importance in the region will depend mainly on the course of the India-China rivalry, an increase in its economic potential, and the support provided to it by foreign partners. The convergence of goals in the Indo-Pacific strengthens India’s partnership with the U.S. and opens up opportunities for intensifying cooperation with the EU, especially in terms of connectivity, climate change, and the development of capacity in maritime domain awareness.
Topic:
International Cooperation, European Union, Partnerships, Geopolitics, and Economy
Political Geography:
Europe, South Asia, India, and Indo-Pacific

5. The Political Economy of the Landscape of Trade Unions in Bangladesh: The Case of the RMG Sector

Author:
Mirza M. Hassan, Syeda Salina Aziz, Raeesa Rahemin, Insiya Khan, and Rafsanul Hoque
Publication Date:
12-2022
Content Type:
Working Paper
Institution:
BRAC Institute of Governance and Development (BIGD), Brac University
Abstract:
The paper explores the political economy landscape of trade unionism in Bangladesh. The focus is on the Ready-Made Garments (RMG) sector, where trade unions (TU) are highly salient and relatively more operational because of the sector’s economic importance, numerical strength of the labour, high degree of concentration of the industries, and TU’s global network, among other factors. Relying predominantly on primary data, we look at both the formal and informal dimensions of industrial relations and their implications for the state-capital-labour interactions as well as governance of TUs. Literature on RMG-related TUs in Bangladesh generally examines it from a social movement perspective. We take a slightly different approach in this paper by making a modest attempt to fulfil the knowledge gaps in TU research. We do this by exploring the formal and informal aspects of relations between the regulatory institutions and the TUs and, more importantly, the internal governance of the TUs themselves as noted above. Additionally, we explore the two-way relational dynamics of TU leaders and the garment workers. These areas have not received much attention in the extant literature. By adopting a politico-sociological perspective, the paper reflects on the collective action dynamics of industrial labour in the context of the global south.
Topic:
Political Economy, Labor Issues, Economy, Trade Unions, and Textile Industry
Political Geography:
Bangladesh and South Asia

6. How the Taliban Re-took Afghanistan

Author:
Paul Rivlin
Publication Date:
09-2021
Content Type:
Working Paper
Institution:
Moshe Dayan Center for Middle Eastern and African Studies
Abstract:
In this issue of Iqtisadi Paul Rivlin discusses the broader historical, political and economic context for the Taliban's recent return to power in Afghanistan. On 15 August 2021, Taliban forces entered the Afghan capital, Kabul, as the government collapsed and the president, Ashraf Ghani, fled the country. This brought an end to the twenty-year campaign waged by the US and its allies to remake the country. The speed with which the Afghan army collapsed shocked many, but others, who understood developments in the country better, were not surprised. On 31 August, the last US forces left the country.
Topic:
Politics, Taliban, Economy, and History
Political Geography:
Afghanistan and South Asia

7. Inclusive COVID-19 Relief Finance

Author:
Amanda Lenhardt
Publication Date:
07-2021
Content Type:
Working Paper
Institution:
Center on International Cooperation
Abstract:
The COVID-19 pandemic has turned all countries’ attention to mitigating the impacts of the crisis, and with this attention has come a wave of finance to address the immediate health risks of the disease and the indirect effects on economies and on well-being. With this influx of spending on welfare and resilience, many have looked on with hope that this collective effort can be done in such a way that the world can ‘build back better.’ But, like any building project, the foundation is critical. This paper sets out to investigate whether countries are investing in the foundational social and economic structures that have led to the vulnerabilities currently upending people’s lives. Failure to address the structural inequalities embedded within societies and across the global political economic structure will ultimately leave the new structure vulnerable to collapse in the long term, and risks exposing marginalized groups to the harshest impacts of the crisis in the short term.
Topic:
Economy, Crisis Management, COVID-19, Marginalization, and Inclusion
Political Geography:
South Asia, East Asia, South Africa, and Latin America

8. India’s Sustained Economic Recovery Will Require Changes to Its Bankruptcy Law

Author:
Anirudh Burman
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
As India’s economy recovers from the coronavirus pandemic, Indian businesses need efficient financial structures to regain their ground. Key reforms to India’s Insolvency and Bankruptcy Code could fill these gaps. One of the key drivers of economic recovery in India will be the efficient movement of capital from inefficient firms to efficient ones. The economic downturn caused by the coronavirus pandemic has been severe, and India’s economy was one of the worst affected in 2020–2021. Though the economy is recovering faster than initial estimates, sustained economic recovery will not take place if stressed businesses cannot restructure their debts properly or if failing firms cannot be resolved efficiently. India’s bankruptcy law is key to solving these challenges. In 2016 India enacted the Insolvency and Bankruptcy Code, 2016 (IBC), which was a landmark reform to the nation’s financial system and the first comprehensive law to regulate insolvency.1 But the IBC has been suspended for a period of one year since the COVID-19-related lockdown was imposed in March 2020. In its place, India’s banking regulator, the Reserve Bank of India (RBI), has introduced a limited restructuring scheme for COVID-19-related stress in the meantime. Older mechanisms for insolvency that are still in operation have historically not worked according to expectations. As the one-year period of suspension comes to a close, this paper argues that bringing back the IBC—with adequate modifications—is an important prerequisite for sustained economic growth. India historically suffered from a patchwork framework of insolvency laws that either did not give lenders adequate powers to recover their debts upon default or only catered to the interests of certain kinds of lenders—to the exclusion of others.2 The IBC is a modern and comprehensive bankruptcy law that since its enactment has had a significant role in reducing the problem of nonperforming assets (NPAs), or “bad loans,” in India’s financial system. In the wake of the economic disruption caused by COVID-19, the Indian government suspended the operation of critical parts of the IBC. These changes meant that lenders could not trigger insolvency proceedings against defaulting businesses if the default occurred after March 20, 2020. While this suspension possibly prevented unnecessary business failures and provided a “calm period” for the economy, these measures have outlived their utility.
Topic:
Law, Finance, Economy, and COVID-19
Political Geography:
South Asia and India

9. Tracking Reforms in Land Leasing and Change in Land Use: Insights From Gujarat and Karnataka

Author:
Ankit Bhatia
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
As India’s economy has become more urban and industrialized, property and land rights have evolved, too. In the states of Gujarat and Karnataka, key reforms in land leasing and change in land use show what may—and what may not—be a path forward. India is primarily an agrarian society. More than 60 percent of its population is dependent on agriculture and allied services and dwells in rural areas. In the past couple of decades, India has attempted to shift away from its rural-agrarian base toward an urban-industrialized economy. In this journey, it encountered many challenges, but none remain as severe and persistent as the ones related to the assignment and balancing of land and property rights. Land governance in India remains historically complex, politically sensitive, and economically inefficient. In recent times, state governments have attempted proactive measures to reform the sector and bring greater efficiency to land markets. Despite the exigency of these reforms, issues surrounding equity, abuse of power, and nexus among powerbrokers remain central and require thorough analysis. To unpack the fuller effects of the recent reforms, this paper aims to examine key reforms in land leasing and change in land use sub-sectors initiated by Gujarat and Karnataka states. The paper takes a comparative assessment approach to decipher the nuances and complexities of land governances in the two states. Given that land has deep historical connections, this paper briefly delves into the historical evolution of land leasing and change in land use regulation in the two states. The historical analysis highlights the political economy context of each sector and is followed by an in-depth review of the recent reforms. The paper covers reforms effectuated through legislative, executive, and judiciary actions. This approach allows a comprehensive tracking of different mechanisms at play. The paper brings out some interesting findings. In both the states, the change in land use sub-sector was able to reform more frequently than the land leasing sub-sector. Despite both states relying upon all three branches of government to initiate reforms, executive action was used most frequently. On occasion, the judiciary played a critical role, especially when lower branches passed judgments that provided windfall relaxation to the protective regulation. Further, the paper finds that most reforms were not structural in nature; they were merely attempts to ease the restrictions on the transfer of agricultural land. In a complete departure from past objectives, recent reforms attempted to dilute the protective framework of land leasing and change in land use regulation. It is understandable that socioeconomic and political realities have shifted and the archaic regulation may not serve its intended purpose. However, the recent reforms have failed to show a concrete new direction. Instead, they largely focused on allowing a greater transfer of land resources to industries, pushing toward more capital-intensive agriculture, and promoting digitalization of land-related governance and public service delivery.
Topic:
Reform, Economy, Urban, and Land Reform
Political Geography:
South Asia and India

10. Do gendered laws matter for women’s economic empowerment?

Author:
Marie Hyland, Simeon Djankov, and Pinelopi Koujianou Goldberg
Publication Date:
03-2021
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
reater legal equality between men and women is associated with a narrower gender gap in opportunities and outcomes, fewer female workers in positions of vulnerable employment, and greater political representation for women. While legal equality is on average associated with better outcomes for women, the experience of individual countries may differ significantly from this average trend, depending on the countries’ stage of development (as proxied by per capita GDP). Case studies from the Democratic Republic of the Congo, India, and Spain demonstrate this deviation. Especially in developing countries, legislative measures may not necessarily translate into actual empowerment, due mainly to deeply entrenched social norms, which render legal reforms ineffective. Women are more likely than men to be in vulnerable employment in low- and lower-middle-income economies but less likely than men to be in vulnerable employment in upper-middle- and high-income economies. Analysis of a 50-year panel of gendered laws in 190 countries reveals that country attributes that do not vary or change only slowly over time—such as a country’s legal origin, form of government, geographic characteristics, and dominant religion—explain a very large portion of the variation across countries. This finding suggests that the path to legal equality between men and women may be a long and arduous one. Nevertheless, the data also show that the past five decades have seen considerable progress toward legal gender equality. Gendered laws do evolve, suggesting a role for legal reforms in women’s economic empowerment.
Topic:
Gender Issues, Law, Women, Inequality, and Economy
Political Geography:
Africa, Europe, South Asia, India, Democratic Republic of the Congo, and Spain

11. How China and Pakistan Negotiate

Author:
Katharine Adeney and Filippo Boni
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
Since being officially launched in April 2015, the China-Pakistan Economic Corridor (CPEC) has been one of the most watched set of projects under the aegis of Chinese President Xi Jinping’s signature Belt and Road Initiative (BRI). Having already injected around $25 billion into Pakistan, the CPEC not only has been dubbed the “flagship project” of the BRI, but it also holds a central role in Beijing’s global ambitions.1 While much has been said about the geopolitical implications of the CPEC, including for both India and the United States, less attention has been devoted to providing in-depth insights into the mechanics of how the BRI is unfolding on the ground in Pakistan. How do China and Pakistan negotiate the terms of CPEC deals? To what extent has Islamabad managed to exert agency in its dealings with Beijing? How does China adapt to the contexts it operates in? By now, the CPEC has been subject to much media, academic, and policy scrutiny, but these questions have not been answered. The power asymmetry between the two partners—coupled with the impression that the BRI represents a unidirectional Chinese endeavor, not just in Pakistan but also globally—has contributed to the erroneous representation that Beijing is merely imposing the CPEC on its all-weather partners in Islamabad. On the contrary, this study highlights China’s adaptive strategies in dealing with a host of Pakistani actors (including political parties, local communities, and the military) against the backdrop of Pakistan’s evolving political landscape and change in leadership following the country’s 2018 elections. In filling this gap, this paper foregrounds the importance of adopting a relational approach to studying how the BRI unfolds on the ground. This entails looking at how Pakistan and China have negotiated the CPEC’s energy, infrastructure, and industrial cooperation projects. The analysis is based on semi-structured elite interviews conducted by the two authors during three rounds of fieldwork in 2015, 2018, and 2020–2021 triangulated with a host of official reports, statements, and newspaper articles. Examining the domestic contours of the CPEC shows that Pakistani actors have wielded agency in important ways throughout the process, while Chinese actors at times have accommodated key Pakistani demands.
Topic:
Energy Policy, Bilateral Relations, Geopolitics, Economy, and Belt and Road Initiative (BRI)
Political Geography:
Pakistan, China, South Asia, and Asia

12. The Local Roots of Chinese Engagement in Pakistan

Author:
Muhammad Tayyab Safdar
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
China has deepened its economic engagement with Pakistan through elite-centered negotiations over the routes and projects of the China-Pakistan Economic Corridor (CPEC). But elites are not the whole story: China has made inroads beyond Pakistan’s political elites with a broader array of local stakeholders in the country’s education, media, and energy sectors. Pull factors in each of these areas are giving local Pakistani actors incentives to develop closer relationships with Chinese actors. In education, China’s status as a rising global power and the promise of future economic returns have driven ever more Pakistanis to learn Mandarin and opt to study abroad in China. In the media sector, the financial pressures facing Pakistan’s private media houses have contributed to increasing domestic buy-in for news sharing agreements with Chinese media organizations. In the power sector, the lack of alternative sources of external funding for local Pakistani conglomerates has resulted in the emergence of joint ventures on electricity generation projects with large Chinese state-owned enterprises (SOEs). At the same time, Chinese government policies are serving as push factors to incentivize Chinese actors to expand their interactions in different segments of Pakistani society. For example, China has opened and sponsors Confucius Institutes and classrooms across Pakistan, while also offering scholarships to Pakistani students interested in studying in China. As Chinese firms have expanded their presence in Pakistan, they have worked with local universities to adapt to local customs and cultural and religious values. In media circles, stakeholders like China’s Xinhua News Agency have worked with local Pakistani media outlets to localize information dissemination and shape Pakistani public opinion on important international issues in ways that are in sync with Beijing’s worldview. And Chinese investment in Pakistan’s power sector is aligned with Chinese SOEs’ Go Global strategy and the expansion of these firms’ operations in overseas markets as part of the BRI. China’s engagement with Pakistani political, social, and economic institutions comes in response to local conditions. By adapting to these conditions and working through local institutions and actors, a host of Chinese actors are poised to continue deepening their interactions with different parts of Pakistani society.
Topic:
Education, Partnerships, Media, Economy, and Engagement
Political Geography:
Pakistan, China, South Asia, and Asia

13. China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries

Author:
Deep Pal
Publication Date:
10-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
China’s economic and political footprint has expanded so quickly that many countries, even those with relatively strong state and civil society institutions, have struggled to grapple with the implications. There has been growing attention to this issue in the United States and the advanced industrial democracies of Japan and Western Europe. But “vulnerable” countries—those where the gap is greatest between the scope and intensity of Chinese activism, on the one hand, and, on the other, local capacity to manage and mitigate political and economic risks—face special challenges. In these countries, the tools and tactics of China’s activism and influence activities remain poorly understood among local experts and elites. Both within and beyond these countries, meanwhile, policy too often transposes Western solutions and is not well adapted to local realities. This is especially notable in two strategic regions: Southeastern, Central, and Eastern Europe; and South Asia. China’s economic and political profile has expanded unusually quickly in these two regions, but many countries lack a deep bench of local experts who can match analysis of the domestic implications of Chinese activism to policy recommendations that reflect domestic political and economic ground truth. To address this gap, the Carnegie Endowment initiated a global project to better understand Chinese activities in eight “pivot” countries in these two strategic regions. The project’s first objective was to enhance local awareness of the scope and nature of Chinese activism in states with (1) weak state institutions, (2) fragile civil societies, or (3) countries where “elite capture” is a feature of the political landscape. Second, the project aimed to strengthen capacity by facilitating a sharing of experiences and best practices across national boundaries. Third, the project sought to develop policy prescriptions for the governments of these countries, as well as the United States and its strategic partners, to mitigate and respond to activities inimical to political independence or well-balanced economic growth and development. To establish a comprehensive picture of China’s activities and their impact, this project dug deeply into Chinese activism in four case countries in each region—eight countries in total. We began by holding workshops, so that influencers across countries could share experiences and compare notes. Invited participants included policymakers, experts, journalists, and others—all with deep local knowledge, steeped in their countries’ politics, economies, and civil societies. In Europe, the four countries were Georgia, Greece, Hungary, and Romania, and in South Asia, Bangladesh, Maldives, Nepal, and Sri Lanka. Cross-national discussions among these regional participants aimed to raise awareness, discuss the implications of China’s growing activism in their countries, and compare notes on the diverse ways in which these various countries had managed the rapid influx of Chinese capital, programs, people, technology, and other sources of influence.
Topic:
International Relations, Foreign Policy, Development, Economy, Engagement, Regionalism, and Resilience
Political Geography:
Bangladesh, China, South Asia, Sri Lanka, Nepal, and Maldives

14. What Matters for Urban Women’s Work?

Author:
Shamindra Nath Roy and Partha Mukhopadhyay
Publication Date:
01-2020
Content Type:
Working Paper
Institution:
Centre for Policy Research, India
Abstract:
India is one of the lowest globally in terms of female labour force participation (FLFP), ranking only better than Pakistan in South Asia. While the decline in FLFP in rural areas is starkly visible, the urban FLFP has been consistently low since the 1980s despite higher economic growth and increasing level of education among females. The economic cost of such low FLFP (16.8%) is huge and if, for instance, it could be raised to the level of FLFP in China (61.5%), it has the potential to raise India’s GDP up to 27%. This paper attempts to investigate the structural deficiencies behind this consistently low urban FLFP through a variety of perspectives, ranging from measuring the complexity of women’s work to the implications of caste, location and family structure. It finds factors like presence of female-friendly industries, provision of regular salaried jobs and policies that cater to women’s needs to work near home like availability of part-time work, can improve the situation, though prejudices arising from patriarchy require to be addressed to make these measures truly transformative and not palliative.
Topic:
Education, Gender Issues, Labor Issues, Women, Inequality, and Economy
Political Geography:
South Asia and India

15. COVID-19’s Impact on Bangladesh Economy

Author:
Muhammad Shahadat, Hossain Siddiquee, and Avinno Faruk
Publication Date:
11-2020
Content Type:
Working Paper
Institution:
BRAC Institute of Governance and Development (BIGD), Brac University
Abstract:
This BIGD study examines the impact of COVID-19’s impact on the major economic and financial indicators of the economy of Bangladesh, including production, wages, price levels, advances, bills, investments, remittances and foreign trade, using the secondary data published by the Bangladesh Bureau of Statistics (BBS), Bangladesh Bank (BB), and the Ministry of Finance (MoF). In addition to the recent impact of the global economic meltdown, Bangladesh also experienced severe demand contraction in the local economy; this exacerbated the overall economic crisis of the country. Considering the duration and severity of COVID-19, we examine its impact on major economic and financial indicators of the Bangladesh economy and recommended policy responses for recovery, based on the analysis. Both domestic and international demands declined due to the outbreak and subsequent lockdown, and, thus, producers responded by lowering output to minimize the loss, especially in the manufacturing sectors. Findings reveal that nominal Wage Rate Index (WRI) in the industry and service sectors fell in recent times, which now appear to be recovering. The national inflation rate has not been affected much based on point-to-point changes. Food inflation fell in May 2020 and stood at 5.09 percent, but it appears to have risen recently. Non-food inflation rates have been falling over the last six months from April-September 2020. Prudent measures should include constant monitoring and adapting to the latest developments in major trading partners and host countries to mitigate the economic losses caused. Bank credit would play a key role in the ongoing and upcoming recovery process, as the government has opted for a credit-led stimulus package. However, as the virus is yet to be contained and an effective vaccine for it is yet to be made available in Bangladesh everywhere and to everyone, its economic repercussions are likely to continue in the foreseeable future.
Topic:
Development, Economy, and COVID-19
Political Geography:
Bangladesh and South Asia

16. The Impact of COVID-19 Pandemic on Small and Medium Enterprises in Bangladesh

Author:
Asadul Islam, Atiya Rahman, and Rafia Nisat
Publication Date:
12-2020
Content Type:
Working Paper
Institution:
BRAC Institute of Governance and Development (BIGD), Brac University
Abstract:
Like other economic players, the novel pandemic severely hit small businesses—the larger source of growth and employment but also the most vulnerable sector—by disrupting national and international business networks, supply chain, and demand. To understand the evolving state of small enterprises during pre, par, and post-lockdown periods, BIGD in collaboration with Monash University, Australia conducted a survey on small enterprises, mostly light-engineering firms, and young workers across 18 districts in Bangladesh. The study finds that lockdown measures caused the majority of small enterprises to shut down, and during the early period of relaxing the lockdown, one-third of the enterprises were operating at limited capacity. Demand drop and the burden of fixed costs to run the businesses were the prominent reasons behind the drastic fall in profit. As a result, workers were losing jobs and the gender gap was widening, because female labour-intensive work (i.e. beauty parlour, tailoring) was affected harder. Other findings of concern include the emerging vulnerabilities for the enterprises with lower endowment and poor access to government stimulus packages and other financial support. The study emphasises on the importance of concrete targeting criteria and support delivery platforms to assist more vulnerable enterprises. Finally, it highlights that the enterprises that received BRAC’s intensive training on occupational health and safety (OHS), along with business training and financial linkages, made double profit compared to their counterparts. However, the absolute amount of profit was substantially lower for both groups, compared to their pre-COVID profit, indicating the importance of scaling up such intensive training to create more resilient enterprises in such crises.
Topic:
Development, Employment, Economy, Business, Pandemic, and COVID-19
Political Geography:
Bangladesh and South Asia

17. Socio-Economic Impact Assessment of COVID-19 and Policy Implications for Bangladesh

Author:
Sultan Hafeez Rahman, Abdur Razzaque, Jillur Rahman, and Wasel Bin Shadat
Publication Date:
10-2020
Content Type:
Working Paper
Institution:
BRAC Institute of Governance and Development (BIGD), Brac University
Abstract:
The COVID-19 pandemic is causing unprecedented health and economic crisis for global economies, including Bangladesh. The economic and social disruption caused by the pandemic as reflected in a massive loss of human life worldwide, drastic decline in economic activities and employment, huge pressure on public health and other support services, social and physical distancing, etc. has been devastating. Since the first confirmed case of infection in March 2020, Bangladesh, like many other countries, had to consider some extraordinary measures including, amongst others, closure of all educational institutions, enforcement of economic shutdown measures and gradual reopening of economic activities, rolling out a stimulus package for business enterprises, etc. This study is motivated by the fact that understanding the economywide impact of Covid-19 has been challenging in Bangladesh. Global Trade Analysis Project (GTAP) model – a multi-region/multi-country computable general equilibrium comparative static framework – is utilized in this study to explore the potential impacts of COVID-19 induced disruptions for Bangladesh under three different alternative – low-shock, medium shock and high-shock scenarios. It outlines the transmission mechanisms through which the Bangladesh economy is being affected to assess the impact on major macroeconomic variables and sectoral outputs. These results are then incorporated into the social accounting matrix for Bangladesh to simulate the likely income and poverty effects for various types of households. This study also explores the likely impact of government support measures through the stimulus package in mitigating the adverse consequences.
Topic:
Economy, Public Policy, COVID-19, Health Crisis, and Socioeconomics
Political Geography:
Bangladesh and South Asia

18. India’s Great Slowdown: What Happened? What’s the Way Out?

Author:
Arvind Subramanian and Josh Felman
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
We examine the pattern of growth in the 2010s. Standard explanations cannot account for the long slowdown, followed by a sharp collapse. Our explanation stresses both structural and cyclical factors, with finance as the distinctive, common element. In the immediate aftermath of the Global Financial Crisis (GFC), two key drivers of growth decelerated. Export growth slowed sharply as world trade stagnated, while investment fell victim to a homegrown Balance Sheet crisis, which came in two waves. The first wave—the Twin Balance Sheet crisis, encompassing banks and infrastructure companies—arrived when the infrastructure projects started during India’s investment boom of the mid-2000s began to go sour. The economy nonetheless continued to grow, despite temporary, adverse demonetization and GST shocks, propelled first by income gains from the large fall in international oil prices, then by government spending and a non-bank financial company (NBFC)-led credit boom. This credit boom financed unsustainable real estate inventory accumulation, inflating a bubble that finally burst in 2019. Consequently, consumption too has now sputtered, causing growth to collapse. As a result, India is now facing a Four Balance Sheet challenge—the original two sectors, plus NBFCs and real estate companies—and is trapped in an adverse interest-growth dynamic, in which risk aversion is leading to high interest rates, depressing growth, and generating more risk aversion. Standard remedies are unavailable: monetary policy is stymied by a broken transmission mechanism; large fiscal stimulus will only push up already-high interest rates, worsening the growth dynamic. The traditional structural reform agenda—land and labour market measures—are important for the medium run but will not address the current problems. Addressing the Four Balance Sheet problem decisively will be critical to durably reviving growth. Raising agricultural productivity is also high priority. And even before that, a Data Big Bang is needed to restore trust and enable better policy design.
Topic:
International Trade and Finance, Economy, Global Political Economy, Economic Growth, and Global Financial Crisis
Political Geography:
South Asia and India

19. Rapid Care Analysis as a Qualitative Research Tool to Explore Unpaid Care Work: Experience from Char Area in Bangladesh

Author:
Sahida Islam Khondaker
Publication Date:
06-2019
Content Type:
Working Paper
Institution:
BRAC Institute of Governance and Development (BIGD), Brac University
Abstract:
Everyday unpaid care work is carried out all over the world and it is necessary for a society’s wellbeing. However, unpaid care work is largely ignored by economic and social public policy initiatives. Neither it is adequately valued in economic terms. In developing countries like Bangladesh, most research on unpaid care work is dominated by quantitative research methodologies that generally cannot capture how people actually experience unpaid work on a daily basis. Moreover, they neglect the arena of perceptions of unpaid work. Qualitative participatory approaches allow people to identify the extent to which unpaid work-related problems affect their communities, encourage people to assess the causes and consequences of inequitable distribution of care work and facilitate the identification of interventions from the perspectives of women and men, rather than policymakers or scholars. This paper attempts to describe and analyze the Rapid Care Analysis (RCA) as a qualitative method to study unpaid care work and establish that compared to quantitative methods, RCA as a qualitative method can capture the unequal distribution of care work in the community, measure time uses, create awareness and also find out available services, infrastructure and options to reduce and redistribute care work more comprehensively. From different RCA exercises, it is observed that both male and female participants have understood the notion of heavy and unequal care work. Through the exercise, participants recognized care work as work. Participants also came up with some solution to reduce care work. Quantitative methods cannot provide these insights. Therefore, RCA could be one of the best tools for conducting research on care work.
Topic:
Economy, Research, Public Policy, and Care
Political Geography:
Bangladesh and South Asia

20. Making the Millennium Challenge Corporation Compact Work for Sri Lanka

Author:
Ganeshan Wignaraja
Publication Date:
09-2019
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
In April 2019, the Board of Directors of the Millennium Challenge Corporation (MCC) approved a compact program for Sri Lanka. This is a large five-year grant that was provided to Sri Lanka on the basis that it meets the MCC’s eligibility criteria of good governance, economic freedom, and investment in its citizens. It will be implemented by a team appointed by the Sri Lankan government, under the guidance of MCC. As the process has taken longer than expected, it is hoped that the MCC Board when they meet on 18 September 2019 will grant additional time for the MCC Sri Lanka Compact (MCC Compact) to be approved by Sri Lanka’s Cabinet. President Maithripala Sirisena has suggested that a decision would be taken after the upcoming Presidential elections in Sri Lanka in December 2019. Proponents argue that it can reduce bottlenecks in transport and commercial land administration. Meanwhile, critics of the MCC Compact raise a host of legal, environmental, and external political interference issues. As Sri Lanka prepared to make a decision on whether to proceed with the MCC Compact, a simple cost-benefit analysis of the MCC-Sri Lanka Compact from a national economic perspective is imperative.
Topic:
Governance, Economy, Investment, and Private Sector
Political Geography:
South Asia and Sri Lanka