Gender parity: Lost in transit from school to labour market

When it comes to gender parity, India’s story seems quite curious. The Gender Parity Index (GPI) reached one in the country at primary education level (Class I – V) in 2009-10 and has been greater than one (in favour of females) for all levels of education since 2018-19. The GPI has also been consistent across states over the last five years.

According to the Global Gender Gap 2024 Report (GGGR), India has a Gender Gap Index score of 0.997 in enrollment in primary education, 1.0 in secondary education and 0.982 in higher education. In terms of co-equality, however, there is a huge gap between education and the labour market. In fact, the GGGR places India at the fifth-lowest rank in economic participation by gender gap, which partly explains the country’s overall rank of 129 out of 146 countries.

So why is it that gender parity in education has not been able to wipe out gender-based wage gaps or increase labour force participation rate for women? What are the obstacles for a smooth transition from higher female literacy to higher employment for women?

We can start where the trade-off is closest – higher education. The Gross Enrollment Ratio (GER) in undergraduate disciplines is traditionally skewed by gendered self-selection (for example, engineering courses enroll 42% more men while education courses have 25% more women). But the average gender gap across enrollment in all major disciplines is less than 5% (2021-22). The numbers tell a similar story when grouped by degree (B.Tech to B.A., diploma to PhD) or pass rates. The answer is, therefore. not in higher education alone.

Gender parity is being achieved from the primary level, but enrollment percentages are falling sharply from 103 percent at the primary level to 54% at the higher secondary level and 28% at the higher education level (2021-22). Between ages 14-15 and 16-17, it falls from 73 to 42%, signaling the inability or unwillingness of these students to undertake the transition from secondary to higher secondary level. It is interesting to note there are negligible differences between male and female enrollment and graduation rates in this respect (the differences are noticeable between urban and rural areas).

This declining enrollment as one goes to higher levels of education or what may be called disinterest in undertaking additional years of education can be traced to a host of factors. Students place high expectations on institutions to provide them with tailor-made job opportunities. Any lack thereof erodes faith in the value of traditional arts and science programmes. In addition, the constant transformation of the economy requires a supply of new skills that schools and colleges are slow to implement.

We can consider returns to education as a probability distribution where if one gets a job post-college, it ensures a higher long-run return. But if they do not find employment or get a low-paying job that did not require the degree, the loss is immediate and greater, given the time and money already devoted to those additional years. The trade-off then between starting work at 16 or at 20 with a college degree becomes too small and unpredictable to invest in when low-income families are also often trapped in meeting short-term financial goals. The final decision might end up being a function of the student’s willingness and ability to remain a student, family support and understanding, financial solubility and social expectations.

So, gender parity in education does not mean much if more than 50% of students drop out along the way, or get absorbed unskilled and untrained into informal labour markets. One might take comfort in the gender parity at all levels of education, but this misses a large fraction of students (boys and girls in equal number) becoming unprepared job seekers, often permanently. This is where gender disparities rear their ugly heads again. Women and men, without completing a full quota of their school years, let alone a degree for formal employment, self-select into gender-specific roles, which means more women get reported in unpaid and self-employed categories. And this number is higher in the rural areas. These disparities are more unforgiving in the lower rungs of non-contractual employment in India where the rules and the workplace are still made by men for men. Statistically, the Indian labour market will be easier for the male school dropout to find a job (or have a choice among more jobs) compared to the same for a female.

Similar to how slowly the education system innovates, the labour market also stagnates in its ability to create new labour-intensive jobs for women. Stories of women fitting into male-dominated roles (often successfully) are the exception, not the norm, and the mere absence of female washrooms at a work place is sometimes enough to discourage an entire generation from pursuing a noted occupation.

Despite all this, female labour participation rate has increased by nearly 14 percentage points over the last six years. There is a new wave of female workers entering the labour force, though inadequately prepared to navigate an unflinching patriarchal market. These women will continue to face a disproportionately higher range of challenges related to working conditions, discrimination and balancing family responsibilities.

Our country is in the midst of a long transition period where women are spending more years on education compared to their parents, exercising their choice in marriage and often successfully delaying, having fewer children, and venturing into traditional male-dominated occupations, all while facing a constant battle with less-than-welcoming orthodox fraternities. It will take time for these changes to trickle down across different income and societal classes. As always, a sound education holds the key.

This article is authored by Jayanta Talukder, associate fellow at the National Council of Applied Economic Research (NCAER), New Delhi.

Circular economy adoption in MSMEs: unveiling enablers and barriers

The study aims to explore the enablers and barriers to the adoption of circular economy (CE) practices in micro, small and medium enterprises (MSMEs) and examine how these factors differ between developed and developing countries.

Design/methodology/approach

The research uses a systematic literature review (SLR) methodology to identify key enablers and barriers to CE adoption in MSMEs. The SLR process involved a detailed search and analysis of relevant academic articles from the Scopus and Web of Science databases, following the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) guidelines to ensure transparency.

Findings

The study identifies 19 enablers and 16 barriers to CE adoption in MSMEs. Technological upgrades are the key factor helping MSMEs successfully implement CE practices, while financial constraints are the main challenge they face, according to studies from both developed and developing countries.

Originality/value

This research contributes to the existing body of literature by not only identifying the primary factors that either support or impede the implementation of CE by MSMEs but also by classifying them according to developed and developing countries to provide policymakers and MSME stakeholders with valuable insights on enhancing the implementation of CE in both countries by taking into account the particular barriers and enablers faced by each group individually.

Brics’ daringly autonomous model for financial sovereignty

Three communiqués, two approaches, one global economy.

In the rarefied world of economic policy-making, where the public and markets are distanced from complex decision-making, communiqués serve as windows into the ambitions, hesitations and geopolitical leanings of powerful economic blocs. Released in October 2024, three influential documents from Brics, the International Monetary Fund’s International Monetary and Financial Committee and the World Bank’s Development Committee each offered a distinct view of the global economic landscape.

While the IMF and World Bank communiqués aim to reinforce established frameworks and shape policy discourse, Brics presents an alternative vision. With an expanded bloc representing over 32% of global gross domestic product and projected by the IMF to control one-third of global output by 2028, Brics is asserting its place in global growth dynamics.

This enlarged group now includes the founding five – Brazil, China, India, Russia and South Africa – alongside the newly admitted Egypt, Ethiopia, Iran, Saudi Arabia (as an invited country) and the United Arab Emirates. Through a dense 134-point communiqué, the Brics bloc articulates its stance on economic and financial sovereignty with increasing clarity and determination.

This latest vision from Brics could be read as an intent to gradually dismantle or, at the very least, challenge the long-standing post-second world war frameworks governing international monetary and financial systems. Or perhaps, more moderately, it signals a loud call for fundamental reform – seeking an ‘inclusive and just’ international financial architecture that better serves emerging and developing economies. Underlying this demand is a palpable distrust in the current system and how global policies are decided.

Are the paths outlined in the IMF and World Bank communiqués and the Brics declaration truly so divergent? Do they not all, in some sense, seek continuity within change or is the world moving towards an institutionalised, bifurcated economic order?

Multipolar sovereignty 

The Brics declaration envisions a multipolar financial system that stands free from the dominance of traditional international monetary structures. Central to their vision is prioritising regional autonomy and financial sovereignty, which directly challenges established global payment systems, such as Swift.

At the heart of this strategy lies the Brics cross-border payments system designed to facilitate transactions in local currencies, reducing reliance on dominant international currencies (once the sterling and now the dollar) and the extensive dollar-centric financial infrastructure. This move aims to shield participating nations from the potential ‘weaponisation’ of reserve currencies and geopolitical pressures.

In contrast, the IMFC communiqué underscores the value of the existing monetary and payments system, reinforcing its role as a stabilising force amid global economic uncertainties. Acknowledging challenges like inflation, rising debt and geopolitical tensions, the IMF’s message remains one of cautious continuity, emphasising stability over transformation.

Double alignment 

With its rapidly growing economic influence and expanded membership, Brics is increasingly positioning itself as an alternative voice and a formidable player with the potential to reshape the international financial order.

However, the dual memberships of many Brics countries in other global economic bodies, including the IMF, World Bank, Financial Stability Board and G20, create a strategic positioning dilemma. Rather than pursuing an exclusive alignment, Brics members may engage in ‘double alignment,’ where they balance the benefits of dollar stability while exploring pathways to financial independence. This delicate balancing act raises the question of whether Brics, as it expands, can maintain cohesion amid diverse national interests and priorities.

For instance, Brazil and India’s nuanced positions – supporting regional co-operation within Brics while remaining committed to Western trade ties – highlight the bloc’s internal diversity. While Russia and China advocate for rapid de-dollarisation and the creation of parallel financial systems, India favours a more measured approach that preserves its integration with global markets. These internal divergences underscore the complexities of Brics’ mission and raise questions about its ability to drive systemic change in the international financial order.

The three communiqués reveal fundamental policy divergences across four critical areas: macroeconomic stability, debt sustainability, climate finance and financial infrastructure.

Macroeconomic stability and debt 

Both Brics and the IMFC/Development Committee acknowledge the growing pressures on emerging economies, aggravated by escalating debt servicing burdens. The IMF’s response has been to expand concessional lending through the Poverty Reduction and Growth Trust – a vital mechanism to support vulnerable economies within the existing dollar-centred monetary framework. The IMF’s coordination with the World Bank’s International Development Association fund replenishment also seeks to provide structured financial support with attached policy conditions, reinforcing a framework prioritising policy continuity and fiscal discipline.

In contrast, Brics aims to expand the reach of its New Development Bank, which provides loans with fewer policy conditions. The appeal of the NDB lies in its flexibility, enabling countries to retain control over their development agendas without the rigorous reforms often mandated by IMF and multilateral lending. By including new members like Egypt, Ethiopia and the UAE, Brics signals a commitment to building an alternative financing model that champions policy sovereignty and gives developing nations more agency in their development pathways.

Climate finance 

Ideological differences also surface on the issue of climate finance. While both Brics and the IMF/World Bank emphasise the importance of climate action, their approaches diverge markedly. The IMF’s communiqué promotes a standardised, multilateral approach, channelling resources through frameworks that align with global climate targets and metrics. For instance, the World Bank’s pledge to double agri-finance commitments by 2030 aims to enhance climate resilience in agriculture through globally standardised frameworks and metrics.

In contrast, Brics supports a decentralised model via the NDB, allowing member nations to fund climate projects tailored to their national needs. Countries like India and Brazil argue that standardised frameworks can overlook emerging economies’ unique priorities and capacities. Brics’ flexible approach to climate finance empowers countries to align investments with their specific developmental paths, avoiding a one-size-fits-all model often favoured by multilateral institutions.

Financial infrastructure 

One of the most ambitious initiatives in the Brics communiqué is a cross-border payment system designed to operate independently of Swift. This effort emphasises the bloc’s frustration with advanced markets’ control over global financial infrastructure, which Brics countries view as susceptible to geopolitical pressures. The bloc seeks to foster financial autonomy by promoting regional trade in local currencies and reducing exposure to the dollar-dominated system through initiatives like the Brics Interbank Cooperation Mechanism and a proposed Brics Reinsurance Company.

Meanwhile, the G20 is advancing its own vision for cross-border payments reform. In collaboration with the IMF, World Bank and Financial Stability Board, the G20 has outlined a roadmap focused on enhancing the existing payment system. Unlike Brics, the G20 initiative aims to incrementally improve the current system through technical upgrades, prioritising faster and more transparent cross-border transactions while continuing to use Swift (at least for now). This divergence represents two competing visions: Brics’ push for a multipolar financial infrastructure versus the G20’s aim to strengthen and modernise the current dollar-centred system.

Navigating a bifurcated financial landscape

The 2024 communiqués from Brics, the IMF and the World Bank represent two diverging visions for global finance. While Brics promotes a multipolar model grounded in financial autonomy, the IMF and World Bank remain committed to continuity within the existing frameworks. As the stakes increase, the influence of these statements – often fraught with contradictions and ambiguous messages – creates uncertainty for investors and policy-makers alike. This unpredictability is unsuitable for global markets or investment flows, particularly when international coherence is needed to address fragile economic growth and mounting social challenges.

For those who monitor the fine print of these communiqués, the messages conveyed can be at odds: a Brics advocating for regional sovereignty, a G20 emphasising cohesion and an IMFC endorsing stability. Yet, without a governance structure that holds these bodies accountable for consistency – especially given the significant overlap in member countries – this fragmented communication risks exacerbating global financial instability. Such inconsistencies sow confusion when both democracy and capitalism are under critical scrutiny, making it essential to communicate a unified approach to pressing global challenges.

As we anticipate further statements from the 11th G20 and COP29 in November 2024, the global financial community will be watching to see whether common ground emerges in areas like sustainable development, trade, climate finance, financial stability, cross-border payments and digital finance. These discussions could pave the way for a more harmonious global economic order or underscore an increasingly divided landscape. While Brics’ calls for a multipolar world may appeal to many developing countries, the entrenched dollar-based system remains a stabilising force that cannot be overlooked. How these bodies address and articulate their differences could determine whether the world heads towards co-operation or confrontation in the coming years.

Udaibir Das is visiting professor at the National Council of Applied Economic Research, senior non-resident adviser at the Bank of England, senior adviser of the International Forum for Sovereign Wealth Funds, and distinguished fellow at the Observer Research Foundation America. He was previously appointed at the Bank for International Settlements and the International Monetary Fund.

Low precautions among internet users amid surge in online frauds

With the rapid rise in internet use in India, the incidents of online frauds/ scams/ cheating has also seen a spurt. Identity theft, social engineering, phishing, skimming, QR code fraud, OTP fraud, frauds using NFC technology, fake cashback links, UPI fraud, etc have now become the buzz words. Fraudsters and scammers are now using advanced and unique techniques to scam and commit fraud, thereby hurting people financially and erode trust. Fraudsters’ agility makes it challenging for authorities to keep up, with even the Prime Minister warning against scams like “digital arrest” fraud. Media reports suggest that online fraud is now a significant concern, leaving people vulnerable to scams at any time.

The Government has taken several steps to generate awareness/ alerts/ advisories through print, audio and visual medium and put in place various mechanisms to deal with  cyber crimes in  a comprehensive  and  coordinated  manner. It culminated with the setting up of the ‘Indian Cyber Crime Coordination Centre’ (I4C).

The initiatives of the Government is only a half-job done, it has to be supplemented by the efforts of the general citizens. Sifting through the Comprehensive Annual Modular Survey (CAMS) from the NSS 79th round (2022-23) reveals intriguing results.

Rural–urban dichotomy, age-divide persist

Analysing the unit level data reveals that there has been a huge upsurge in the number of persons who are able to use smart phones, desktops, laptops, tablets. Such persons (aged 15 years and above) accounted for about 58.9 percent, with 73.2 percent of them residing in urban areas and 52.6 percent in the rural areas. It is obvious that the younger persons form the largest groups of such individuals, both in the rural and urban areas.

But an altogether different picture is seen when it comes to taking precautionary steps to keep themselves safe online. Data shows that only 21.7 percent of persons aged 15 years and above took steps like “setting up effective security measures to protect devices and online accounts (like strong passwords, log-in attempt notification etc)” – it is 29.8 percent in urban areas and only 16.7 percent in rural areas.

When it comes to “changing privacy settings on device, account or app to limit the sharing of personal data and information”, on average only about 21.3 percent of persons have done so – it is 29.5 percent in urban areas and only 16.2 percent in rural areas.

On average, only about 19.6 percent carry out some sort of “verification about the reliability of online information” – it is 27.8 percent in urban areas and only 14.6 percent in rural areas.

Across the board, it is seen that the younger individuals are far more aware and took some precautionary steps as compared to the older persons.

The situation is even more concerning among those aged 60 and above, with only 0.3 percent of the rural population and 3.5 percent in urban areas adopting all three protection measures. In the youngest age group, 14.2 percent of people in rural areas and 30.3 percent in urban areas used all three online protection steps.

Overall, the age-divide is all too obvious, but it is without solace when even amongst the younger lot more than 80 percent of them did not prefer to take any steps to guard and protect themselves. The notion that only elder persons are susceptible to frauds and scams is only a figment of imagination when devices in the hands of the younger population are equally vulnerable.

Male – female gap abounds

Data shows that about 66.3 percent of males and 51.3 percent of females (aged 15 years and above) are able to use smart phones, desktops, laptops, tablets. It is the younger population (both amongst males and females) who form the largest groups of such individuals.

Data further shows that 25.4 percent of males aged 15 years and above took steps like “setting up effective security measures to protect devices and online accounts” – it is far less at 16.8 percent amongst females.

On average, about 24.8 percent of males have taken steps by “changing privacy settings on device, account or app to limit the sharing of personal data and information” – it is only 16.6 percent amongst females.

Further, on average, about 22.9 percent of the males carry out some sort of “verification about the reliability of online information” – it is only 15.2 percent amongst females.

Gender-wise, it is seen that males are more proactive in taking several steps to protect themselves online. At the other end are the older females who are prone to leave their devices vulnerable. Data reveals that a mere 0.5 percent of females aged 60 and above have taken all three online protection steps, while this figure is 2 percent for males in the same age bracket. Among the younger age group of 15-25 years, 22.4 percent of males use all three protective measures, outnumbering their female counterparts (14.7 percent).

Greater awareness and wider adoption of precautionary steps

Fraudsters and scammers are deploying sophisticated technologies along with techniques to exploit the psyche of the targeted individuals. While Government should strengthen the detection, investigation and prosecution of cyber and online frauds, there is also a need for spreading awareness among the general public. Not only that individuals have to take steps to guard themselves, more reporting of frauds and scams should also be encouraged.

Dr. Palash Baruah is Fellow at National Council of Applied Economic Research (NCAER), New Delhi and Mr. D. L. Wankhar is a retired officer of the Government of India. Views and opinions expressed in this article are personal

Monthly Economic Review: October 2024

In the Review, we summarise the economic and policy developments in India; monitor global developments of relevance to India; and showcase the pulse of the economy through an analysis of high-frequency indicators and the heat map.

MER October Report

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