Regional economic engagement within South Asia may gain increasing importance owing to several factors that are currently in play, including strategies to diversify global value chains and locate such value chains nearer home. These developments offer South Asia a chance to enhance its low levels of regional economic engagement and capitalize on significant unrealized development opportunities. This report shows that examining intraregional investment and knowledge connectivity enhances our understanding of the low levels of intraregional trade and limited regional value chains in South Asia. Creating a new and unique data set for South Asian investment, it provides a detailed and nuanced understanding of the drivers of outward investment, both regional and global, for South Asian firms. “Regional Investment Pioneers in South Asia†? provides key considerations for policy makers in South Asia, which remain particularly relevant in the aftermath of the pandemic. First, it makes a case for regulatory relaxation of outward FDI regimes, based on new micro foundations, grounded in value chains. Second, it spells out details of smart inward FDI promotion techniques and investment facilitation. Third, it identifies distinct cross-border information-enhancing and network development activities. Fourth, it suggests that digital connectivity and continued interventions in reducing trade costs are warranted to increase investment as well as trade flows. There is particular scope to build on the digitalization initiatives in trade and investment facilitation taken during the pandemic. “Regional Investment Pioneers in South Asia†? follows on, and is complementary to, the earlier World Bank report, “A Glass Half Full: the Promise of Regional Trade in South Asia.†?

This report is framed within the same context as its predecessor, ?A Glass Half Full: The Promise of Regional Trade in South Asia," namely, the sub-optimal level of economic engagement within South Asia. It focuses on intraregional investment, from an outward investment lens, using a unifying framework of international engagement strategies.

South Asia is facing renewed challenges. The impact of the Russia-Ukraine war on food and energy prices on domestic inflation is long-lasting. Externally, countries’ current account balances deteriorate rapidly as imports rise on the back of economic recovery and rising inflation, remittances decline, and foreign capital flows out following monetary tightening in advanced economies. An economic slowdown in advanced economies and trading partners can also be a drag to the exports sector and remittances inflows, which many countries in the region depend on. These immediate challenges can translate to persistent deterrent to long-term growth and development. Higher energy prices already are changing the attitude of many countries outside the region about green transition and carbon reduction. The South Asia region is thus at a critical juncture. The theme chapter provides a deep dive into COVID-19 and migration. Migrant workers and remittances flows are important for South Asia as sources of income and means to smooth local income shocks for households, and as an important source of foreign reserves for the country. The pandemic changed the flows of migration, as some migrants had to return home and some had to stay in foreign countries due to COVID-related restrictions. The chapter studies the long-run trend of migration in the region, how COVID-19 impacted migration and remittance inflows, whether migration has (or has not) recovered, and proposes policies to address underlying problems.

Building a skilled and diverse science, technology, engineering, and mathematics (STEM) workforce is crucial for economic development, cross-border trade, and social inclusion in South Asia. However, underrepresentation of girls and women in STEM education and careers remains a persistent issue. What kinds of macro and micro socioeconomic interventions are needed to increase girls' and women's access to and participation in STEM education and careers in South Asia? This book compares trends in South Asia with global trends to examine how access to and choices of STEM fields affect girls' enrollment in upper secondary education, technical and vocational education and training, and higher education in the region as well as their selection of careers. Based on the analysis, it offers recommendations to policy makers and practitioners to improve inclusion. The following are among the findings: (1) The five key opportunities to foster inclusion and enrollment in STEM education--and staunch the 'leaky pipeline'--are at the upper primary, lower and upper secondary, and tertiary education levels, and during the early career years; (2) A strong pathway from STEM education to career depends on an integrated, systematic approach that motivates students to pursue STEM fields, builds STEM skills, and removes barriers to diversity; (3) With the increasing migration of workers between countries in South Asia, preparing a critical mass of semiskilled and skilled STEM migrant workers has cross-border value, especially for workers migrating from smaller to larger economies. New ways of defining STEM occupations are required to help develop and sustain female interest in STEM education and careers. Potential strategies that governments can pursue include raising awareness and building knowledge and skills in STEM outside the formal academic environment--such as in after-school programs, science fairs and competitions, and summer camps--and developing and systematically disseminating standardized resources. Inclusion and diversity must be championed by governments, the private sector, and other stakeholders who stand to benefit from more diverse workforces. Though women themselves would likely be credible champions, in South Asia they are often constrained by a range of factors. This report addresses some of those obstacles.

This report investigates the role of foreign direct investment (FDI) in helping developing countries participate in global value chains (GVCs). It combines the perspectives and strategies from three types of players: multinational corporations, domestic firms and governments. It aims to provide practical guidance for developing countries to develop strategies that use FDI to strengthen GVC participation and upgrading. The report has six main chapters: 1. FDI and GVCs. Assesses the trade-investment nexus and analyzes the effect of FDI in countries’ GVC participation and upgrading at the country level. 2. MNCs shape GVC development. Highlights MNCs' contribution to global economy and how their business strategies shape the evolution of GVCs. The chapter also compares MNCs' business strategies in terms of outsourcing and offshoring, risk mitigation and increasing market power across GVC archetypes. 3. Domestic firm perspectives on GVC participation. Looks at the various paths domestic firms can take to internationalize their production and trade. Investigates domestic firm characteristics that predict higher GVC participation, and the effect of GVC participation on firm performance. 4. Investment policy and promotion: what is in a government’s toolbox? Summarizes the various policy instruments governments have at their disposal to help attract MNCs to their country and facilitate GVC participation of domestic firms. 5. Integrating countries into GVCs. Draws on a range of case studies to illustrate how governments can develop coherent strategies and policy packages to integrate their countries into GVCs. 6. FDI and GVCs in the wake of COVID-19. Reflects the impact of COVID-19 on FDI and GVCs, the response from multinationals and suppliers, and the implications for GVC reconfiguration. In addition, there are seven case studies that offer more nuanced analysis on the GVC participation in selected countries and sectors: • Five qualitative case studies: Five countries have been selected that managed to use FDI to stimulate GVC participation using a range of approaches. By design, these five countries also cover five different GVC archetypes. These countries are: (1) Kenya (horticulture); (2) Dominican Republic (textiles); (3) Mauritius (tourism); (4) Malaysia (electronics); (5) China (software). • Two quantitative case studies: Rwanda, West-Bengal (India). These use a combination of firm- and transaction level datasets to study firm-level dynamics that explain the role of multinational and domestic firms across GVCs.

South Asian leaders have made it a priority to tackle key regional issues such as poverty, environment degradation, trade and investment barriers and food insecurity, among others.

Africa’s Development Dynamics uses lessons from Central, East, North, Southern and West Africa to develop policy recommendations and share good practices across the continent. Drawing on the most recent statistics, the analysis of development dynamics aims to assist African leaders in reaching the targets of the African Union’s Agenda 2063 at all levels: continental, regional, national and local.