It is not even a week that International Women’s Day was celebrated. My article is a tribute to the women of the developing world, is about the importance of hitting the “sweet spot” of demographic dividend through tapping the massive energy existing in the woman-power.
Nuances of gender
Development policymaking is getting more complex. This is more so because, people keep criticising governments for slowing down growth rates, express qualms with poverty, lack of education and health facilities, and also depleting natural resource base that sustains the human system. Traditional thinking in development emerging from the writings of the Classical Political Economists (CPEs) like Adam Smith and David Ricardo, however, was concentrated towards sustaining and enhancing the “social basket” of goods, which later on became construed as the gross domestic product (GDP). Therefore, the capitalist system that was analysed by the CPEs essentially talked about “efficiency” that can result in maximising the size of the basket.
Even today, large parts of the developing world including India perceives GDP growth as “development”, with the perception that growth can take care of all ills! But, the occidental developmental thinking changed from the 1940s with Colin Clark’s quantitative study that made economists realise that most of the humankind did not live in the advanced capitalist economic systems. Decolonisation was an important catalyst that made many realise that the plethora of newly formed nations had different standards of living from the European ways of life.
Despite rapid urbanisation, Indian development thinking is yet to encourage more women to join the labour force. (Photo: Reuters)
Development thinking — by which we mean the analysis of not only growth but also of institutions that could induce, sustain, and accelerate growth—began in earnest to change its focus and rearrange its referential. It brought in notions of distribution and hence of “equity”, where poverty, health, education, etc became critical, as development needed a “conflict-free” system that is only possible once these concerns are taken care of. Yet, the unbridled “growth-fetishism” of human civilisation continued and created the threat on the natural resource base.
Ever since the Club of Rome’s prediction of apocalypse in their The Limits to Growth thesis, the human response to the “approaching doomsday” has been characterised by extensive research, gradual knowledge accrual through global assessments, and conventions. The Earth Summit of 1992 adopted the Brundtland Commission Report’s definition of “sustainable development”. Eventually, sustainability became another critical pillar of the broader developmental discourse. Thus, today, the challenge of development policy thinking emerges as a challenge to reconcile between the “irreconcilable trinity” of efficiency, equity, and sustainability. This finds the best form of articulation in the United Nations’ 17 Sustainable Development Goals (SDGs) to be achieved by 2030.
UN SDGs consider “gender equality” as one of the goals (SDG-5). From this perspective, it appears gender is an “equity” concern. Studies show women’s economic empowerment can help poverty reduction, and create a more educated next generation!
However, I argue that gender is cross-cutting and in-built across the triad of the irreconcilable trinity. Rather, bringing the gender dimension in the broader developmental policy discourse helps in the reconciliation process. Here, I bring in the notion of 4 factors of capital, namely, social capital, human capital, physical capital, and natural capital. In a recent ORF paper with my colleagues, I argued that the SDGs are embedded in these 4-factors, and these 4 are enabling factors for ease of doing business.
Driving India’s dream
Let me refer to a 2015 McKinsey report raising concern about Saudi Arabia’s depleting oil reserves, which so far has been the fulcrum of its economy. What will happen to it in a “non-oil” economy? McKinsey says that the economy needs to realise its potential through a productivity-led transformation. This is possible through a shift from the government-led economic model to a more market-oriented approach: this needs enabling greater women participation in the workforce that may go against the norms of Saudi’s otherwise conservative social system. The prescription is for replacing the losses from an otherwise depleting “natural capital” through better utilisation of “human capital” in a more diversified economy. This will help sustain growth, and lead to lower exploitation of the natural capital. This is where the “sweet spot” of demographic dividend can be hit: a situation when in an economy, skilled, productively employed healthy workers grow faster than the population. This is a replicable model for India and South Asia.
Despite rapid urbanisation, Indian development thinking is yet to leverage this “sweet spot” by encouraging more women to join the labour force. Rural jobs have been decreasing and not enough rural women have been able to make the transition to working in urban areas. The disparity of wages and salaries or “returns to the human factor of production” is increasing. In the context of achievements with respect to SDG 5, a recent UN report ranks India at 115 out of 162 nations. Women participation in the workforce in a more “equal world” is a pillar of development that can help reconcile the “irreconcilable trinity” by addressing efficiency (through productive labour), bringing forth equity (with more incomes distributed), and in addressing sustainability. Tapping this untapped human capital for formal economic sectors can be a major driver for achieving the Indian dream of a 5-trillion-dollar-economy.
(Courtesy of Mail Today)