Promoting Diversity: Women's Entrepreneurship and Economic Empowerment in India

Women empowerment is a transformative force that goes beyond mere gender parity. It is about fostering a society where women are active participants, leaders, and catalysts for positive change. From advocating for their rights to pursue education and career opportunities, women's contributions have been invaluable. Empowering women is important for economic growth and development as their leadership, resilience and creativity play a crucial role in shaping societies and nations. Women make up a big part of the workforce and contribute to innovation and growth across industries. In India, female entrepreneurs are leading the way in making the country a strong global economy. In this blog, we discuss the steps being taken to promote women's entrepreneurship and economic empowerment in India.

Women empowerment: Cultivating prosperity and driving growth in India

The true measure of a nation's progress lies in its commitment to the well-being and empowerment of its women. Women's empowerment is not just a moral imperative; it is a cornerstone for sustainable development and economic prosperity. Recognising this, the United Nation’s Sustainable Development Goals (SDG 5 – Gender Equality) underscore the paramountcy of gender equality for societal advancement.

Despite the significant presence of 432 million working-aged women in India (~45% of the total working-age population of 960 million according to 2022 World Bank figures), their current contribution to the GDP remains modest, standing at 18%, implying significant upside potential. Among these, 343 million are employed in the unorganised sector. McKinsey Global Institute estimates that by providing equal opportunities, India could add a staggering US$ 770 billion (~22.7% of FY22 GDP) to its GDP by 2025. From small businesses to start-ups, women are driving innovation and growth, making significant and critical differences.

Government initiatives and NGO contributions

While being at helm in the G20 Presidency, India emphasised its focus on women's development, marking a historic milestone for gender equality and empowerment. This transition, reflected in the adoption of the Chair's Statement at the G20 Ministerial Conference for Women Empowerment, underscores India’s commitment to advancing gender parity on the global stage.

Introducing the interim budget for 2024, India's Minister of Finance, Ms. Nirmala Sitharaman, underlined the significance of women as one of the four pillars of Viksit Bharat. She highlighted the subject stating that entrepreneurship, ease of living, and dignity gained momentum in the last ten years, while applauding and recognising Indian women for their active involvement in the workforce and their enrolment in STEM (science, technology, engineering, and mathematics) courses in higher education. The finance minister also informed that forty-three crore loans totalling US$ 270.92 billion (Rs. 22.5 lakh crore) have been approved under the PM Mudra Yojana. Furthermore, she stated that in the past ten years, an astounding thirty crore Mudra Yojana loans have been given to women exclusively.

She added that nine crore women are presently part of eighty-three lakh self-help groups (SHGs), which are significantly enhancing the socioeconomic circumstances in rural areas. With the help of these SHGs, almost one crore women have gained financial independence and self-determination, earning them the title of ‘Lakhpati Didi’, or ‘millionaire sisters’. Considering this success, the government has decided to raise the goal for ‘Lakhpati Didi’ from two crore to three crore.

The Government has actively undertaken initiatives to empower women entrepreneurs in the MSME sector. Notably, Prime Minister Employment Generation Programme (PMEGP) offers credit-linked subsidies with a higher subsidy rate for women entrepreneurs. The Mahila Coir Yojana provides training and incentives for women artisans to establish micro-enterprises.

For financial support, the Credit Guarantee Fund Trust for micro and small enterprises extends an 85% guarantee cover and reduces the annual guarantee fee by 10% for women entrepreneurs. Additionally, there is a mandate for central ministries and departments to procure 3% of their annual requirements from women-owned micro and small enterprises.

Various schemes, such as Micro & Small Enterprises - Cluster Development Programme, Scheme of Fund for Regeneration of Traditional Industries, and Entrepreneurship Skill Development Programme, focus on the development of women-owned MSMEs. The Women Entrepreneurship Platform (WEP) by NITI Aayog acts as a one-stop information hub for women entrepreneurs, addressing information gaps.

The Atal Innovation Mission (AIM) and Start-up India initiative play a crucial role in fostering innovation and supporting entrepreneurship, with a focus on strengthening women's entrepreneurship. The Deendayal Antyodaya Yojana and the Start-up Village Entrepreneurship Programme also aim to assist women in setting up micro units.

The Government actively monitors the registration of women-owned MSMEs, reflecting a commitment to women's empowerment.

National Family Health Survey – 5 (NFHS-5) data reflect significant strides in women's status over the past five years. Presently, 78.6% of women independently own and use bank accounts, a 25% increase from 2019. Mobile phone ownership has risen to 54% in 2021, and 43% of women now own a house or land in 2021, up from 38% in 2016. NFHS-5 also indicates an improved sex ratio and reveals that one in five non-farm businesses is led by women. These encouraging trends highlight the Government’s policies leading to substantial advancements in women's economic and social empowerment in India.

The transformative role of women entrepreneurs in India's economic landscape

In India's evolving economic landscape, women entrepreneurs play an increasingly pivotal role, making indispensable contributions that warrant due acknowledgment. These dynamic female entrepreneurs exert substantial influence on the Indian economy, serving as catalysts for employment generation, development acceleration and overall prosperity.

According to a McKinsey Global Institute report, by 2025, increasing women's equality might boost global growth by US$ 12 trillion. Realising women's potential would greatly advance economic development in a nation like India. According to World Bank estimates, India's economic growth would rise by a significant 1.5% to 9% annually, even if 50% of women were able to enter the workforce.

However, much of their informal labour, spanning markets, service jobs, garment work, and handicraft manufacturing, remains unaccounted for in official definitions of economic productivity. To unleash the full economic potential, there is a need to better recognise and value women's work and provide them with increased opportunities to contribute to the formal economy. The women-inclusive approach has not only created job opportunities but also played a pivotal role in uplifting millions of families from poverty. Women, particularly in new-age sectors, exhibit superior leadership abilities and higher productivity levels, underscoring their significance in the contemporary workforce. By fostering an environment that acknowledges and supports women entrepreneurs, India stands poised to unlock great economic potential, fostering inclusive development that benefits society.

Visionary women entrepreneurs reshaping India's economic landscape

India's economic trajectory is being profoundly influenced by resilient and visionary women entrepreneurs who have broken barriers and achieved remarkable success in diverse fields.

• Mrs. Kiran Mazumdar-Shaw, the founder of Biocon Ltd., revolutionised healthcare with her biopharmaceutical company, displaying innovation and leadership in the biotech sector and inspiring women in STEM.
• Mrs. Falguni Nayar's Nykaa transformed the beauty retail landscape, reflecting her vision for a comprehensive beauty destination and making her an inspiration for entrepreneurs attuned to customer preferences.
• Mrs. Shradha Sharma's YourStory became a media empire amplifying entrepreneurial voices fostering innovation, collaboration, and inspiration in India's start-up ecosystem.
• Mrs. Upasana Taku, co-founder of MobiKwik, played a pivotal role in digitising financial transactions, making MobiKwik a trusted mobile payment platform and breaking barriers in India's FinTech sector.
• Mrs. Sneha Choudhry addressed India's accommodation challenge through ZoloStays, providing affordable, hassle-free stays and revolutionising the real estate sector.
• Mrs. Divya Gokulnath, co-founder of BYJU'S, transformed learning with a revolutionary ed-tech platform, contributing to India's education sector's growth.

These women entrepreneurs not only drive economic growth through their ventures but also serve as inspirational figures, fostering empowerment and diversity in India's evolving business landscape.

Conclusion

Women's empowerment stands as a transformative force shaping India's societal, economic, and developmental landscape. Despite progress, challenges persist, from discrimination and gender-based violence to economic disparities between urban and rural areas.

The significance of women's empowerment extends beyond achieving gender equality; it propels India towards inclusivity and prosperity. Grassroots organisations become agents of change, actively empowering women for collective advocacy and societal well-being.

Women's empowerment is a cornerstone for sustainable development, with their economic contributions often underestimated. As India's female entrepreneurs emerge as pivotal players, recognising, reducing, and redistributing unpaid care work becomes imperative. McKinsey estimates a substantial GDP boost by providing equal opportunities to women, underlining their critical role in innovation and growth.

As India leads the G20, the representation of women becomes a global beacon for social justice and economic empowerment. Fostering an environment supportive of women entrepreneurs unlocks greater economic potential, steering India towards a more inclusive and prosperous future.