In this context, this study aims to incorporate the gender-differentiated employment and wages for select South Asian economies across sectors to identify targeted value chains and economic activities, particularly among green trade sectors, that would benefit women in the region. The study has the potential to provide insights to policy makers in measuring the impact of trade liberalization and regional integration measures on gender employment and wages focusing on green trade sectors. The data set developed would help analyze economic activities related to green trade that could benefit female labor force participation and wages. The understanding about gender outcomes when supported by data and analysis could enable governments to design better trade liberalization and regional integration policies and programs and improve the targeting of sectors that would benefit women and reduce existing gender disparities over time in South Asian countries. The study would not only help in analyzing the gender dimensions of trade agreements but also in subsequent research on the gendered impacts of other global shocks.

While global trade liberalization is an important issue, in our study we focus mainly on regional integration for a couple of reasons; first, regional integration is a pressing issue in this region, given the mutual protectionism even in terms of tariffs: therefore it is interesting enough to focus on regional integration; second, we have focused on gender data development only in this region and not in other countries, which is beyond the scope of this study; a global trade policy shock would have required inclusion of gender information in other countries as well. We therefore focus on a couple of illustrative simulations of tariff elimination, a practical one that involves BBIN (Bangladesh, Bhutan, India and Nepal), and an ambitious one that involves all the South Asian countries.

1.1 Female Labor Force Participation and Gender Wage Gap: What is the evidence?

The importance of achieving gender equality has been increasingly recognized in the policy debate across the globe. However, the recent literature highlights that the gender gap has widened globally for women both in terms of employment and wages at work compared to men. A recent Global Gender Gap Report 2020 published by World Economic Forum (2019) highlights that overall global gender parity will not be attained for the next 99.5 years mainly because of lack of progress in closing the Economic Participation and Opportunity gap. The report also projects that it would take 257 years in 2019 to close the global gender pay gap compared to 202 years last year. A report published by ILO (2016) had also projected that at the current pace of progress, it would take more than 70 years to close the gender wage gaps completely, i.e., the gender pay gap would remain until 2086. It highlighted that the gender wage gap is unrelated to a country’s level of economic development, as some of the countries with high per-capita levels are also among those with the highest gender wage gaps.

A study by McKinsey Global Institute (2015) showed that narrowing the gender gap in the global labor market would double women’s contribution to global GDP growth between 2014 and 2025. The study estimated that in a full potential scenario in which women play an identical role in labor markets as men, as much as US$ 28 trillion, or 26 percent, could be added to global annual GDP by 2025 compared with a business-as-usual scenario. While 4