Context

The World Bank released the South Asia regional update report, Jobs for Resilience.

Demographic Dividend: Key Findings from the Report

• South Asian Economic Outlook: India’s economy was expected to post a “robust growth” of 7.5% in FY23/24. 
  • This expansion coupled with recoveries in Sri Lanka and Pakistan, was largely driving the strong numbers for the South Asian region.
• Not Capitalizing on Demographic Dividend: The World Bank has warned that the South Asia region including India was not making use of its demographic dividend.
• Growth in the working-age population outpacing Job Creation: The pace of job creation in the region fell short of the growth in the working-age population, even as it projected  a strong 6.0-6.1% growth for 2024-25 for the region.
  • The region could have 16% higher output growth if the share of its working-age population that was employed was on a par with other emerging market and developing economies (EMDE).
• Status in India:  India’s employment growth  was “well below” the average growth in its working age population for the 2000-23 period.
• The country’s employment ratio had declined more than in any other country in the region except Nepal up till 2022. 
• India’s robust economic expansion has, however, kept the region’s output growth stronger than in other EMDE.
• Weak employment trends in the region: These were concentrated in non-agricultural sectors reflecting challenges in the institutional and economic climate, which had stifled the growth of businesses. 
• Recommendations for growth in Employment: Supporting the participation of women in the economy, increasing access to finance, increasing openness to trade, easing financial sector regulations and improving education.

World Bank (WB)

• About: The World Bank is the collective name for the International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA).
• Genesis: It was established along with the International Monetary Fund at the 1944 Bretton Woods Conference of which India was a founding member.
• World Bank Group: It is a unique global partnership of five institutions working for sustainable solutions that reduce poverty and build shared prosperity in developing countries.

Different Institutions under World Bank Group

• International Bank for Reconstruction and Development (IBRD): It provides commercial or concessional loans to only sovereign states or projects backed by sovereign states.
  • Its loans are aimed to improve transportation and infrastructure, education, domestic policy, environmental consciousness, energy investments, healthcare, access to food and potable water, and access to improved sanitation.
• International Development Association (IDA): It helps the world’s poorest countries and aims to reduce poverty by providing interest-free loans (called IDA Credits) and grants for programs that boost economic growth, reduce inequalities and improve people’s living conditions.
• International Finance Corporation (IFC): IFC was created in 1956 to foster private sector investment in developing nations.
  • It finances the private sector investment, mobilizing capital in the international financial markets, and providing advisory services to businesses and governments.
• Multilateral Investment Guarantee (MIGA): MIGA promotes foreign direct investment (FDI) into developing countries to help support economic growth, reduce poverty, and improve people’s lives.
• International Centre for Settlement of Investment Disputes (ICSID): It is an autonomous, multilateral specialized institution to encourage international flow of investment and mitigate non-commercial risks.
  • India is not a member of ICSID.

Important Reports

• Global Economic Prospects
• Global Financial Development Report
• World Development Reports
• International Debt Statistics