South Asia faces policy bottlenecks related to trade, labor markets, poverty alleviation and climate change

New Delhi, India - The International Food Policy Research Institute (IFPRI), the South Asian Network on Economic Modeling (SANEM), together with the Indian Council of Agricultural Research-Indian Agricultural Research Institute (ICAR-IARI) with support from CGIAR, launched an introductory training course on Computable General Equilibrium (CGE) modeling today. Over the course of the one-week long training program, participants will gain hands-on experience with IFPRI’s Standard CGE Model, equipping them with the skills to explore critical policy questions across diverse economic contexts. The program will serve as a launchpad for those looking to refine and expand their economic modeling capabilities to more advanced levels.

South Asia is home to some of the world's fastest growing and most dynamic economies. However, the region faces policy bottlenecks related to trade, labor markets, poverty alleviation, and climate change. CGE modeling is an essential analytical tool for researchers and policymakers in such a dynamic and ever-changing policy environment./They are especially helpful in South Asia, where thorough impact analysis is necessary for structural changes, policy reforms, and economic shocks. By modeling real-world situations and forecasting possible outcomes, CGE models facilitate data-driven decision-making, whether examining the effects of trade liberalization, tax reforms, energy policies, or climate adaptation plans.

Dr. Alka Singh, Professor and Head, Division of Agricultural Economics, ICAR-IARI, welcomed the participants emphasizing the importance of capacity-building initiatives like this training, which is the second since 2024 and mentioned that “such training provides a unique and valuable opportunity for cross learning among participants”.

Enhancing local competence in CGE modeling can improve policy formulation, promote regional cooperation, and propel sustainable economic development considering the region's interrelated economies and varied socioeconomic structures. To ensure resilient and inclusive growth, investments in CGE research and training will enable South Asian institutions to create context-specific, evidence-based policy solutions.

Dr. Shahidur Rashid, Director-South Asia Regional Office, IFPRI, underscored IFPRI’s continued role in capacity building since its inception. He also emphasized that “South Asia is also one of fastest growing sub-regions but also faces new and emerging challenges. Policy modeling can be an important tool to help governments and policymakers identify these challenges and understand the linkages in the system to find possible solutions and accelerate development”.

Dr. Selim Raihan, Executive Director, SANEM, gave the participants an overview of the training which will focus on both theoretical foundations and practical applications of CGE modeling, followed by a post-training hands-on research assignment, where participants will apply CGE modeling techniques to a policy issue of their choice, receiving mentorship from SANEM and IFPRI researchers.

To commemorate the success of the 2024 CGE training program and to inspire participants for the ongoing 2025 edition, two policy briefs were officially launched during the inaugural session. These briefs highlight key learnings from the previous training, emphasizing the role of CGE modeling in evidence-based policymaking.

“Economic policies are like torch bearers that can lead a country towards development and transformation and guide many key decisions. Thus, it is important to understand how policies interact under different situations, what could be the determinants of success and how to possibly achieve it while also balancing stakeholders' requirements.”, added Dr. Ch. Srinivasa Rao, Director and Vice Chancellor, ICAR-IARI.

The underutilization of data-driven policy tools is one of South Asia's major challenges. Instead of thorough cause analyses, many economic decisions are focused on short-term factors. By simulating the long-term implications of policies prior to implementation, CGE modeling helps to lower uncertainty and guarantee better policy results. A crucial step in utilizing data-driven policy tools is effective capacity building and skill training.

“One of the key pillars of ICAR's longstanding partnership with IFPRI is capacity building, and we have been working together to enhance capacities for scientists and researchers in ICAR institutions and state universities, particularly in areas of impact analysis and policy modeling. These tools help us monitor and study impact, opening possibilities for course correction and to consider new areas for research and investment.”, stressed Dr. R. C. Agrawal, Deputy Director General – Agricultural Education, ICAR. He also underscored the need to cultivate expertise in advanced computing tools, empowering individuals to become self-sufficient analysts. The transformative potential of Artificial Intelligence (AI), Internet of Things (IoT), and data-driven innovations in agriculture, further opens avenues for future collaborations and groundbreaking advancements.

Dr. P. K. Joshi, President, Agricultural Economics Research Association (AERA), India, expressed his pleasure upon seeing participants from various countries and impressed upon them the importance of "skilling, re-skilling and upskilling". He noted that " in addition to data analytical skills, imagination and a clear vision for the future you wish to foresee are equally important for modeling.” He also suggested documenting and replicating this training process for other programs for increase efficiency.

Since 2001, IFPRI has been actively engaged in building capacity in CGE modeling, conducting over 30 training programs worldwide and training more than 500 researchers from 30 countries. As South Asian countries continue to navigate economic transformations, climate challenges, and trade policy shifts, the need for advanced analytical tools like CGE models has never been more critical.


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