The Fourth SANEM-World Bank North America Discussion Forum 2023 on “Shocks and Development Strategies: Towards a Resilient South Asia” was successfully held on May 5, 2023, from 8:30 AM – 7:30 PM (Eastern Time Zone, GMT–4). Arranged by South Asian Network on Economic Modeling (SANEM), the World Bank and South Asia Economic Policy Network, the forum took place at the premises of World Bank in Washington, D.C., USA. The event aimed to bring together a diverse range of participants, including academicians, researchers, policy advocates, and aspiring economists. To ensure wider accessibility and participation, the forum was also live-streamed through the web conferencing app Webex.

Dr Selim Raihan, Professor of Economics at the University of Dhaka and Executive Director at SANEM, commenced the conference with his welcome remarks, where he expressed his gratitude to co-organizer World Bank and participants of the conference.

Dr Raihan began his speech by discussing the importance of sharing ideas and building networks. Upon outlining the structure of the conference, he introduced its theme and emphasized on the need to understand the nature of shocks in South Asia. Dr Raihan identified four areas to be crucial for building resilience which were- broad-based economic growth strategies, prudent macroeconomic management, strong social sector encompassing health, education and social protection, and finally, enhanced institutional capacity.

Dr Raihan’s speech was followed by the welcome remarks delivered by Dr Zoe Leiyu Xie, Senior Economist at the Chief Economist Office for South Asia, where she thanked the participants along with the South Asian Chief Economist Office for their cooperation.

The keynote speech of the conference was delivered by Mr Hans Timmer, Chief Economist for the South Asia region at the World Bank, in which he discussed various short- and long-term challenges hovering over South Asia, along with the development strategies required to mitigate them.

Mr Timmer initiated by addressing the specific challenges that the region and its economy faced due to Covid. He questioned the efficacy of the lockdown as it could not restrain people from being exposed to the Delta variant, and expressed his concerns about the job loss faced by the workers in the informal sector. For a long period, educational institutions were closed which raised the drop out rates significantly, affecting the female gender disproportionately. He stressed on the need to rethink the vaccine strategy for the developing countries, alongside the urgency to reevaluate the healthcare system in South Asia. Subsequently, Mr Timmer addressed the issue of commodity prices and its effect on the South Asian economies provided they are heavily import-dependent nations. As a consequence, impacts on their balance of payment, price level and real income are substantial. Following that, he discussed the macroeconomic challenges, primarily related to exchange rate policies, that are persistent in Sri Lanka, Pakistan and to some extent in Bangladesh. With depreciating currencies and depleting reserves, the countries faced debt crises that prompted them to adopt various ad hoc measures such as import bans and additional capital controls.

The speaker then addressed the long-term issues that need to be dealt with in the context of South Asia. The region is heavily dependent on fossil fuel imports, and at the same time it is extremely vulnerable to the risks of climate change. Therefore, it needs long-term adaptation strategy to survive and to protect its environment. Mr Timmer also expressed his concerns regarding the region’s inability to develop a sound export base, unlike that of many East Asian countries such as Korea and Vietnam. Additionally, he emphasized on evaluating the impact of factors such as geopolitical shifts, changing international division of labor, digital technologies and the prospect of service sector on the regional economy of South Asia.

Upon juxtaposing the short and long-term crises, Mr Timmer then shed some light on the existing debate of whether to adopt short-term or long-term measures to recover from a crisis. He argued that relief efforts are an immediate necessity in the moments of crisis to support the population. But at the same time, he added, global historical contexts of 1930, 1970 and 2008 exhibit that these are the moments to initiate major changes in the course of action and to rebuild resilient economies.

According to Mr Timmer, arguments on both sides have certain credibility. But in case of South Asia, he stated, one certain structural challenge is responsible for its short-term challenges and long-term impediments. He identified the underutilization of capacity to be the key reason for the sluggishness of the economies in the region, which is caused by less female participation in the labor force and low productivity. Therefore, he concluded, the importance of building a productive and inclusive regional economy is paramount.

A total of 26 papers were presented across eight sessions of the day-long conference. The first session, focusing on “Macroeconomic Challenges”, was chaired by Dr Selim Raihan, Executive Director of SANEM and a Professor of Economics at the University of Dhaka, Bangladesh. The session commenced with a presentation by Dr Barun Deb Pal from IFPRI, India, who delivered a paper titled “How Far Can Macro-Economic Policies Help Revive Indian Economy during the Pandemic? A Computable General Equilibrium Analysis”. The paper was co-authored by Dr Sanjib Pohit, a professor at NCAER, India, and Dr Meenakshi Rajeev, the RBI Chair Professor at the Institute for Social and Economic Change, India. Following that, Ms Syeda ShahBano Ijaz, a PhD student at the University of California at San Diego, USA, presented her research on “Demanding the Last Mile: Foreign Aid and Political Participation in Pakistan”. Lastly, Mr Zaeem-Al Ehsan, a Research Associate at The World Bank, South Asia Region, Poverty & Equity Global Practice, discussed his study entitled “Filling in the Blanks from Outer Space—Estimating District-level GDP Using Nightlights”. This study was co-authored by Dr Syed Basher, a Professor of Economics at East West University, Professor Salim Rashid, also from East West University, and Mr Mohammad Riad Uddin from IFPRI, Dhaka.

Dr Maurizio Bussolo, Lead Economist at the South Asia Region Office of the Chief Economist, World Bank, chaired the second session on “Health Sector Challenges and Development”. Dr Moogdho Mahzab, a Postdoctoral Fellow at Stanford University, USA, presented the first paper of the session on “Impact of Community Clinics on Health Outcomes: A Natural Experiment in Bangladesh”. Dr Kate Vyborny, Associate Director at DevLab, Duke University, USA, Dr Erica Field, a Professor of Economics and Global Health at Duke University, USA, and Ms Nina Buchmann, a PhD student in Economics at Stanford University, USA, were the shared authors of this research paper. Mr Kazuki Motohashi, a PhD student in Economics and Public Policy at Tufts University, USA, then presented his paper on “Unintended Consequences of Sanitation: Negative Externalities on Water Quality and Health in India”. Lastly, Mr Md Shahadath Hossain, a PhD student in Economics at Binghamton University, USA, discussed his research on “The Hidden Costs of Illness: Effect of Parental Illness on Child Health in Bangladesh”.

Session 3 on “Inequality Dynamics” was chaired by Dr Ana Maria Munoz Boudet, Senior Social Scientist at the Poverty Global Practice, World Bank. The presentations included the following research papers: “Hidden in Plain Sight: Asymmetric Information and Hidden Income within the Household” presented by Ms Sally Zhang, a PhD student at Stanford University, USA; “Foreign Military Withdrawal, Male Migration, and Female Education” presented by Dr Ahmad Shah Mobariz, a Postdoctoral Associate at the University of Pittsburgh, USA; and “Dynamics of International Migration, Remittances, and Inequality in Rural Bangladesh” presented by Mr Mahtab Uddin, a PhD student at the Global Development Institute, The University of Manchester, UK.

Dr Syed Akhtar Mahmood, Former Lead Private Sector Specialist in the Macroeconomics, Trade and Investment Global Practice of the World Bank Group, chaired the fourth session on “Trade and Development”. Ms Israt Hossain, Senior Research Associate at SANEM, presented the first paper of the session on “Does Energy Trade Impact Energy Intensity?”. Ms Eshrat Sharmin, also a Senior Research Associate at SANEM, was the shared author of the paper. Dr Md Deluair Hossen, a Post Doctorate Research Associate at the Department of Agricultural & Resource Economics, University of Tennessee, Knoxville, USA, then shared his work on “Financing Costs, Per-Shipment Costs and Shipping Frequency: Firm-Level Evidence from Bangladesh” at the session. Dr Devaki Ghose, an Economist at the Trade and International Integration Unit, World Bank, discussed her work on “Fertilizer Import Ban, Agro-exports, and Welfare: Evidence from Sri Lanka” which was co-authored by Eduardo Fraga, Ana Fernandes, Gonzalo Varela from the World Bank. A presentation on “Linkages between Industrial Enclaves and Firm Performance: Evidence from South Asia” by Dr Mitali Pradhan, Assistant Professor of Economics at Farmingdale State College, USA, concluded the session.

A special address regarding regional cooperation in South Asia was delivered by Ms Cecile Fruman, Director of South Asia regional integration and engagement, World Bank. Upon identifying South Asia as one of the least integrated regions with many barriers to cooperation, Ms Fruman talked about the importance of facilitating dialogues among researchers in order to initiate progress. She outlined two points highlighting the necessity of coordination between World Bank and researchers.

Her first point emphasized on the relevance of research in building a credible evidence base that could demonstrate the benefits of regional cooperation for development, growth, resilience and inclusion to the relevant stakeholders. She initiated with the discussion on transport connectivity and its contribution to trade facilitation. Referring to the BBIN MVA (Motor Vehicle Agreement), she stated that GDP growth in countries such as Bangladesh and India could be tremendous with greater trade facilitation. She then analyzed the economic as well as the environmental benefits of regional electricity trade, where she deduced that Bangladesh and India could reduce carbon emission significantly by importing hydropower from Nepal and Bhutan. She also referred to the report on striving for clean air, which exhibits that the four countries of the Indo-Gangetic plain sharing an air shed need to collaborate to enhance the air quality efficiently. She concluded her first point affirming that these researches are concrete and powerful evidence that assist in gaining traction with policymakers.

On her second point, Ms Fruman highlighted the role of World Bank in aiding the region to build resilience against shocks. As opposed to protectionist and inward-focusing approaches, she argued that countries in collaboration can exchange information, build knowledge resources and enhance capacities to fight shocks. She then discussed the three pillars of the RICE (Regional Integration, Cooperation and Engagement) Initiative by World Bank- enabling economic connectivity, reducing vulnerabilities and building resilience, and investing in human capital. Alongside ensuring transport connectivity to facilitate trade, World Bank is working to improve digital connectivity which will simplify cross-border payment procedures, leading to an increase in e-commerce activities and inflow of remittances. Subsequently, Ms Fruman discussed about the challenges associated with climate change noting the susceptibility of the population residing in this region. She further stated that the joint acquisition of expensive services such as Hydromet can help small nations such as Nepal and Bhutan in resisting disasters, as it facilitates data-sharing through early forecasts. In addition to that, she argued that regional approaches to resilience are more effective in resisting pandemics such as Covid. Finally, she talked about World Bank’s inclusive approach to increase female participation in the labor force, referring to its economic benefit such as increased growth and greater resilience.

Acknowledging the existing political barriers in the scenario, Ms Fruman stressed on the importance of working on a sub-regional level, where there is willingness to engage with certain social and economic gains. She ended her speech upon encouraging researchers to think regionally in their work, and to bring forth evidence-based research that can help promote regional cooperation in South Asia.

Dr Jean Nahrae Lee, a Senior Economist at the South Asia Region Office of the Chief Economist, World Bank, assumed the role of chair for Session 5 which was labelled as “Development Issues”. The session started with Dr Khawaja Mamun, Associate Professor at Sacred Heart University, USA, presenting his research paper on “The Macrodynamics of Indian Rupee Swap Yields” which was co-authored by Dr Tanweer Akram, Senior Economist at Citibank, USA. It was followed by a presentation from Ms Ayesha Ahmed, a PhD student at the University of California-Davis, USA, who shared her research on “Who Benefits from the Agricultural Microcredit Program?”. Lastly, a presentation on “Principal-Agent Problems in the Purchase of Household Durables: Evidence from Nepal” by Dr Nirmal Kumar Raut, Associate Professor at the Central Department of Economics, Tribhuvan University, Nepal, concluded the session. Professor Massimo Filippini from the Center of Economic Research, ETH Zurich, Switzerland, and Dr Suchita Srinivasan, Postdoctoral Research Fellow at the Center of Economic Research, ETH Zurich, Switzerland, were the shared authors in this paper.

In Session 6 on “Gender and Equity”, Dr Nele Warrinnier, an economist at the South Asia Region Office of the Chief Economist, World Bank, served as the chair. Dr Aaditya Dar, an economist at Amazon and Assistant Professor of Economics at the Indian School of Business (on leave), USA, commenced the session with the discussion on his paper titled “Alcohol Prohibition and Violence against Women”, of which Dr Abhilasha Sahay, an economist at the World Bank, was a shared author. Following that, Mr Akarshik Banerjee, a PhD student at the University of Wisconsin-Madison, USA, and Dr Shruti Sharma, an Assistant Professor of Economics at City University of New York, USA, respectively discussed their individual works on “Power Gendered Resource Theory: Linking Neighborhood Wealth Comparisons and Wife Abuse” and “Trade Liberalization and Gender Inequality in India: A Task-Content of Occupations Approach”. The session ended with Dr Arun Balachandran, a Postdoctoral Fellow at the University of Maryland, USA, presenting his work on “Transportation, Employment and Gender Norms: Evidence from Indian Cities” which was co-authored by Professor Sonalde Desai from the University of Maryland, USA, and the National Council for Applied Economic Research, India.

Session 7, titled “Development Issues II,” was chaired by Dr Margaret Triyana, a Senior Economist at the South Asia Region Office of the Chief Economist, World Bank. Dr Sadia Priyanka, an Assistant Professor of Economics at Connecticut College, USA, shared her work on “Intergenerational Effect of an Education Stipend Program on Child Development: Evidence from Bangladesh” in which she collaborated with Dr Raisa Sara, an Assistant Professor at Sam Houston State University, USA. In that sequence, Mr Kartikeya Batra, a PhD student in Economics at the University of Maryland, USA, presented on “Long-Run Effects of Colonial Land Redistribution: Evidence from India” which was followed by a presentation on “Inclusiveness in Higher Studies in Bangladesh” by Mr Chowdhury Amir Abdullah, a Master’s student at North Carolina State University, USA. The paper was co-authored by Ms Ayesha Ahmed, a PhD student in Economics at the University of California, Davis, USA.

The last session of paper presentation, dedicated to the issue of “Labor Market”, was chaired by Dr Zoe Xie, a Senior Economist at the South Asia Region Office of the Chief Economist, World Bank. Mr Mir Tanzim Nur Angkur, a PhD student in Applied Economics at Western Michigan University, USA, delivered a presentation on “The Economics of Remittance Receipts in a Refugee Camp: The Case of Rohingyas in Bangladesh”. Subsequently, Mr Sibbir Ahmad, a PhD student at Michigan State University, USA, and a Short-Term Consultant at the World Bank, presented his research paper titled “Labor Market Discrimination in Bangladesh: An Experimental Evidence”, which was co-authored by Dr Songqing Jin and Dr Veronique Theriault, both from Michigan State University, USA, alongside Dr Klaus Deininger from the World Bank. Lastly, Mr Towhid Iqram Mahmood, a PhD student in Agricultural and Applied Economics at Texas Tech University, USA, discussed the final paper of the conference captioned “Anti-Sweatshop Activism and the Safety-Employment Tradeoff: Evidence from Bangladesh’s Rana Plaza Disaster”. Dr Kevin Grier from the Department of Political Science at Texas Tech University, and Dr Benjamin Powell from the Rawls College of Business Administration at Texas Tech University were the fellow authors of this paper.

Please check the detailed agenda here: http://sanemnet.org/wp-content/uploads/2022/10/Agenda_SNADF2023.pdf