The $28-trillion lever for global GDP: Why G20's prioitises women-led development

GLOBAL INEQUALITY AFFECTS us all. Did you know that every person in the world could earn $23,620 more during their lifetime? Research by World Bank suggests so. In our collective pursuit of a more equitable, sustainable and happier world, we often come across complex challenges that require multiple solutions. One such challenge is the need for capital to drive initiatives that can bring about positive change. However, by enhancing women’s participation in the workforce, ensuring pay parity, and recognising the value of the care economy, we can unlock a staggering $28 trillion in global GDP.

The Economic Power of Women

The three main pillars of sustainable development—economic, social and environmental—are dependent on gender equality. Research suggests that gender disparities are imposing substantial economic costs and intensifying social imbalances and ecological deterioration globally. Accounting for half of the global population, women possess immense potential as contributors to economic growth. But their underutilisation leads to a massive loss for the global economy. There is a need to invest in education, health and economic development of women as this can have a multiplier effect on the economy.

On the positive side, female presence in the workplace is growing and not just at the junior levels. From 2017 to 2022, there has been a consistent worldwide rise in the proportion of women occupying senior and leadership positions. In 2022, the global gender parity index attained its highest level yet at 42.7 per cent, per World Economic Forum. It adds that India, with a female population of around 662 million, has shown the most positive change to its performance on economic participation and opportunity, a testament to the effective leadership and vision of the government.

Further, India’s women and child welfare ministry has been relentless in its pursuit of women’s empowerment. From the National Policy for the Empowerment of Women, multi-fold entrepreneurship and skill development programmes and reformed maternity benefits to empowerment at all levels from panchayats to the corporate workforce, the government has successfully created a model of ‘women-led development’. To truly maximise economic benefits and unlock trillions in GDP growth, it’s essential that we double down on key focus areas like corporate inclusion and entrepreneurship opportunities, while adding newer avenues that bring more women to helm development.

The Powerful Catalyst of a Care Economy

The care economy refers to the production, distribution and consumption of care services, including child and elder care, healthcare, education and domestic work. It is the backbone of any society, yet it remains undervalued and underdeveloped. Recognising its potential, the ILO estimates that 269 million new jobs could be created if investments in education, health and social work were doubled by 2030. Although India recognises its importance, the country’s care economy has largely remained unorganised and informal, predominantly carried out by women in their households. This presents a significant opportunity if properly harnessed, as it would allow women to contribute to the formal workforce, leading to improved gender equality, economic empowerment and social well-being. Moreover, professionalising the care sector would ensure fair wages, social protection, and better working conditions for care workers. Additionally, better access to care services would further allow women to return to work after their maternity breaks faster and reduce post-break dropouts.

India’s Entrepreneurial Spirit

A decade and a half ago, the world was hit by a financial crisis with the collapse of Lehman Brothers. Referring to it, Christine Lagarde, currently President of ECB and former MD of IMF had written “if it had been Lehman Sisters rather than Lehman Brothers, the world might well look a lot different today”. Her words highlight qualities such as risk aversion, response to uncertainty, ethics and moral attitudes, and leadership possessed by women that make them better entrepreneurs. The government has already created ample opportunities in this space. Programmes such as Mahila E-haat and Stand-Up India promote women’s entrepreneurship and provide

financial assistance to support women-led businesses. By building on these initiatives, investing in women’s education and dismantling barriers, we can create a world where women’s contributions are valued, and opportunities are equal.

Create More Women Decision-makers

The government has actively recognised the need to enhance women’s representation in decision-making positions and boards. Efforts are also being made to encourage greater female representation in politics, corporate leadership, and public administration, ensuring diverse perspectives and promoting gender equality at all levels. Collaboration between the government, private sector, civil society organisations and individuals is essential to create lasting change.

Skilling for a Greener Economy

Oxford Economics estimates that a green economy will create an opportunity worth $10.3 trillion in the global GDP of 2050. This lays out a significant opportunity to prepare and skill the female workforce to play an integral part in this transformation. We must progress on ensuring that more women are in productive and decision-making roles so that we can move rapidly and more assuredly towards sustainability in the economic, social and environmental sense.

As we strive towards that, it is crucial to acknowledge the $28-trillion lever that women’s empowerment holds for the global economy. What is imperative is the adoption of gender-smart investment strategies that utilise capital to tackle gender imbalances and promote the advancement of women as entrepreneurs, corporate leaders, employees, and consumers of products and services, and bolsters their economic involvement. As G20 Empower 2023 pursues women’s empowerment as a priority and India leads the way with Prime Minister Narendra Modi’s direction of not just ‘Development of Women’ but ‘Women-led Development’, we can unlock the power of women around the world to build a sustainable and resilient world.

The author is Sangita Reddy, Chair, G20 Empower India; Joint MD, Apollo Hospitals Enterprise (Views are personal)