A key question facing education policymakers in many emerging economies is whether to promote the local language, as opposed to English, in elementary schools. The dilemma is particularly strong in countries that underwent rapid globalization, making English a lingua franca for international as well as domestic exchange. In this paper, we estimate the change in returns to English skills in response to globalization by exploiting an exogenous language policy intervention in the state of West Bengal in India. Our results indicate a significantly high English skill premium in the labor market in terms of 2004 wages. A 1% decrease in the probability of learning English lowers weekly
wages by 1.6%. On average, this implies a 68% reduction in wages due to the language policy change. A closer look into the channel through which this inequality has grown reveals that occupational choice played a decisive role in determining the wage gap.