News Highlights
Asian Development Bank (ADB) published a report called ‘Potential Economic Impact of COVID19 related School Closures’.on GDP due to learning losses
Economic changes as a result of learning and earning losses by covid 19 as per ADB report
- Education
- The Gross Domestic Product (GDP) of India, which is among the countries with the longest school closures during the COVID19 pandemic, will see the highest decline in South Asia due to learning losses for the young.
- India has notable enrolment in secondary education and among students in rural areas.
- Economies with a significant population of school children and college goers in rural areas and in the poorest and second wealth quintile have been the worst hit as they lack access to stable Internet connection needed to study online.
- Employment
- Starting with a $10.5 billion dent in 2023, the country’s economy could take a nearly $99 billion hit by 2030, translating into a 3.19% reduction in GDP from the baseline growth trend.
- India may account for over 10% of the global GDP decline of $943 billion estimated by the ADB on account of earning losses in 2030, with jobs for skilled labour expected to decline by 1%, and unskilled labour by 2% that year.
- Learning and earning losses are significant because a notable portion of the impacted population will migrate to the unskilled labour force.
- A large part of India’s workforce is constituted by unskilled labour 408.4 million as per the ADB paper’s estimates, compared to 72.65 million skilled workers.
- School closures lead to declines in global GDP and employment.
- GDP in two terms
- In terms of absolute change, India experiences the highest GDP decline in South Asia, at $98.84 billion in 2030.
- In percentage terms, its GDP decreases by 0.34% in 2023, 1.36% in 2026, and 3.19% in 2030.
Recommendation to Overcome the Issue as Per ADB Report
- Recover “lost opportunities” by conducting assessments among impacted children.
- Identify the learning gap and specific learning needs of individuals
- Effective learning programs should be devised to offer appropriate support such as tutoring or special classes and help them to bridge the learning gap.
- Governments need to direct adequate funding and resources to young populations most affected by closures, such as those from the poor, rural and socially disadvantaged groups.
- It is important to keep school-age children in education as much as possible by providing financial support and incentives, while giving additional support for skills training to youth already out of school
| Do You Know? Gross Domestic Product (GDP) – The total monetary or market worth of all finished goods and services produced inside a country’s borders in a certain time period is known as GDP. It’s estimated on a regular basis to account for changes in the production structure, relative pricing, and better economic documentation. |
| Asian Development Bank (ADB) It is a regional development bank established on 19 December 1966 Headquarters – Manila , Philippines Membership – Non-regional developed countries and members of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP, formerly the Economic Commission for Asia and the Far East or ECAFE) are allowed to join the bank. Functions – It aims to promote social and economic development in Asia and the Pacific. Voting – Similar to voting in World Bank Voting Weightage – United States and Japan (15.6% each ) > People’s Republic of China (6.4%) > India (6.3%) > Australia (5.8%). |
Content Source – The Hindu