World Bank says ‘local economic development’ is need of hour; lists out these 3 focus areas

While large size economic reforms may help India to recover from the woes induced by the coronavirus pandemic, transforming local economies is likely to be a game-changer in economic revival. There is now a need to focus on comprehensive support to transform local economies during and after the pandemic for long-term economic recovery and resilience, said a World Bank blog. The piece further said that the local economic development approach in the rural context can have three focus areas — a territorial focus to capitalize on the strengths of a specific region or area, linking poor people to value chains with potential, and investments that promote the local business environment with improvements in internet access, electricity, and core infrastructure. 

It also hailed the initiative taken by India towards women’s self-help groups (SHGs) through the World Bank-supported National Rural Livelihoods Mission for the production of masks and hand sanitizer, dissemination of vital public health information, and preparation of food for distribution in community kitchens. Local economic development is considered to be the most critical determinant in improving the quality of economic growth both in terms of offering inclusion as well as resilience and sustainability.

Also Read: India’s low unemployment rate gives no reason to cheer; workers prefer to sit out of job market

The World Bank said that local economic development in a post-COVID context requires fresh, bold ideas to support women, youth, informal sector workers, and micro and small enterprises on a more sustainable basis. It pointed out that the pandemic has created significant risks for the most vulnerable, including women, youth, and informal workers.  

Meanwhile, it is recommended that approaches including investing in improving the quality of the community investment climate, linking community institutions to value chains, investing in productive infrastructure, supporting financial institutions, and developing public-private partnerships can lead to the betterment of livelihoods. Improving access to digital technologies is considered to be another way to promote the business environment and livelihoods, as well as improving access to education, health, and leadership training.