Enhancing Women’s Economic Empowerment Through Trade

Recent studies indicate that lowering trade barriers can benefit women’s economic participation. The Export-Import Bank of India (Exim Bank) conducted a study titled “Trade as a Tool for Economic Empowerment of Women – An Indian Perspective.” This study reveals that sectors with higher female employment often face elevated tariffs on inputs. By reducing these tariffs, the economy can experience substantial growth and welfare improvements.

Impact of Tariff Reductions

The study found that a 1% reduction in tariffs in export sectors with female workforce presence could increase the labour supply by 0.36%. Additionally, it could lead to a 0.14% rise in India’s GDP. The overall welfare gains from such tariff reductions are projected at approximately 3.6%. This marks the connection between trade policies and economic outcomes for women.

Focus Areas for Women’s Employment

Women in India predominantly work in low-technology and resource-intensive sectors. Key industries include food and beverages, leather products, and textiles. These sectors are vulnerable to global demand fluctuations and commodity price shocks. This vulnerability puts stress on the importance of tariff reductions to protect and promote women’s roles in these industries.

Actionable Strategies for Empowerment

The study suggests several strategies to enhance women’s participation in trade. Mainstreaming gender considerations in trade agreements is crucial. Implementing women-centric trade facilitation measures can further support women’s economic empowerment. The use of e-commerce is recommended to improve market access for women, allowing them to compete more effectively.

Support for Women Entrepreneurs

Exim Bank is committed to developing financing programmes specifically for women entrepreneurs. This initiative aims to strengthen their export capabilities. By enhancing access to export finance, women can better navigate the challenges of international trade. Addressing gaps in gender-disaggregated data is also essential for informed policy-making.

Questions for UPSC:

1. Critically analyse the impact of trade policies on women’s economic empowerment in India.
2. What are the challenges faced by women in low-technology sectors? How can policy interventions address these challenges?
3. Estimate the potential economic benefits of increasing women’s participation in trade.
4. Point out the significance of e-commerce in enhancing market access for women entrepreneurs.

Answer Hints:

1. Critically analyse the impact of trade policies on women’s economic empowerment in India.

1. Trade policies that lower tariffs can enhance women’s participation in the workforce.
2. Reduction in tariffs in sectors with high female employment can lead to increased GDP and labor supply.
3. Women are predominantly employed in sectors that face higher tariffs, indicating a need for policy reform.
4. Targeted trade agreements can ensure gender considerations are integrated, promoting economic empowerment.
5. Overall welfare gains from tariff reductions emphasize the link between trade policy and women’s economic status.

2. What are the challenges faced by women in low-technology sectors? How can policy interventions address these challenges?

1. Women in low-technology sectors often face job instability due to global demand fluctuations.
2. Resource-intensive industries expose women to commodity price shocks, affecting their income stability.
3. Limited access to financing and export opportunities hinders women’s economic growth in these sectors.
4. Policy interventions can include targeted financial support and training programs to enhance skills.
5. Implementing gender-focused trade facilitation measures can help mitigate these challenges and promote resilience.

3. Estimate the potential economic benefits of increasing women’s participation in trade.

1. A 1% reduction in tariffs could increase labor supply by 0.36%, positively impacting economic output.
2. Increased female participation can lead to a 0.14% rise in India’s GDP, enhancing overall economic performance.
3. Welfare gains from tariff reductions are estimated at approximately 3.6%, indicating economic benefits.
4. Empowering women in trade can lead to diversification of the economy and improved market competitiveness.
5. Greater economic participation of women can encourage innovation and productivity in various sectors.

4. Point out the significance of e-commerce in enhancing market access for women entrepreneurs.

1. E-commerce provides women entrepreneurs with a platform to reach wider markets beyond local limitations.
2. It reduces traditional barriers to entry, such as high overhead costs associated with physical stores.
3. Women can leverage e-commerce to showcase their products and services effectively, enhancing visibility.
4. Access to online marketplaces can facilitate better pricing and reduce reliance on intermediaries.
5. Training in e-commerce can empower women with essential digital skills, encouraging economic independence.