Women Entrepreneurs In India: Status, Need, Challenges, Schemes, and Way Forward

Context: 

This Article is based on the news “Shri Narayan Rane says in last 10 years under  transformative leadership of the Prime Minister there has been an unprecedented increase in the number of women entrepreneurs in India” which was published in the Pib. Recently, the 9th Annual Shakti International Women Entrepreneurs Summit was held in New Delhi. 

Shakti International Women Entrepreneurs Summit 2024

• Organized by: It is an annual Conference on the occasion of International Women’s Day (March 8) being organised by India SME Forum with the support of the Ministry of Micro, Small and Medium Enterprises, Govt. of India, in association with Women Entrepreneurs Forum.
• Aim: To empower aspiring and established women entrepreneurs while also celebrating the achievements of emerging women entrepreneurs from varied industry sectors.

New Initiatives Launched During the International Women Entrepreneurs Summit

• Panjikaran Se Pragati: 

  • It is a joint integrated national campaign by the Ministry of  MSME and Women Entrepreneurship Platform (WEP). 
    • Target: This national campaign is a clarion call to women entrepreneurs nationwide to get Udyam registered and unlock a world of opportunities.

• WEP- Unnati-Udyamita se Pragati:

• • It is a joint program of the Ministry of MSME and the Women’s Entrepreneurship Platform (WEP).
    • Target: This MSME – WEP Award-to-Reward (ATR) programme is a groundbreaking initiative to take Women SMEs to the next level of growth by providing comprehensive capacity-building support through WEP.

• The Mentorship Platform is For Women Entrepreneurship Platform (WEP):

• • WEP: It is an initiative of NITI Aayog (launched at the 8th Global Entrepreneurship Summit in 2017). 
    • It is a first-of-its-kind, unified access portal that brings together women from different parts of India to realise their entrepreneurial aspirations. 

• Honour to Women: 

  • During the program, women entrepreneurs who were beneficiaries of the CGTMSE scheme and better-performing women entrepreneurs were honoured.

• An Unprecedented Increase: 

• • A significant increase in women entrepreneurs is also observed in the MSME sector. Women lead more than 1.40 crore MSMEs. 
    • Zed Certification of women-owned MSMEs is now completely free.
      • MSME Sustainable (ZED) Certification: It is an extensive drive to create awareness amongst MSMEs about Zero Defect Zero Effect (ZED) practices and motivate and incentivise them for ZED Certification while encouraging them to become MSME Champions.

Status of Women Entrepreneurs in India

• Report by Bain & Company: Nearly 20% of enterprises in India are owned by women. 
• The Recent Women in India’s Startup Ecosystem Report or WISER: Women-led startups have risen to 18% in India since 2017.
• Mastercard Index of Women Entrepreneurs: India ranks 57th out of 65 on the Index, indicating a substantial journey ahead. Despite this, the financial commitment to women-led startups showed a commendable increase, with funding escalating to 18% of the overall in 2022.
  • Currently, the country has nearly 14% of women entrepreneurs, equating to 8.05 million, and over 20% of the MSME sector comprises women-led businesses.

Why Do We Need Women Entrepreneurs in India?

The promotion and encouragement of women entrepreneurs in India carry numerous benefits for both individuals and the overall economic and societal landscape. Here are many reasons why there is a need for more women entrepreneurs in India:

• A Basic Building Block: 

  • Women are the building blocks of a nation and essential for sustainable development that be a social, economic, or political sphere in the country.
    • Women’s financial independence leads to their partaking in decisions right from their personal lives to their homes and society. Therefore, women’s economic freedom is one of the basic building blocks of the aspirational society that we intend.

• To Bridge the Economic Gender Disparity: 

  • As per the World Economic Forum Report 2019, for every dollar a man gets paid, a woman on average is paid 54 cents. 
    • According to the World Bank’s Women, Business and the Law 2022 report, Women earn only two-thirds of men’s expected lifetime income; therefore, reducing the inequalities in economic opportunity that could close this gap may lead to enormous benefits for the world.

• To Break the Orthodox View: 

  • The old perceptions of family responsibility on women pose an overwhelming challenge, the patriarchal attitude restricts women’s duties to domestic and family work, thus preventing them from acting independently.
    • Women need to be financially strong to change the conventional thinking of segregating different sectors for women and men as well.

• To Achieve Economic Targets: 

  • As India progresses economically and targets a USD 5 trillion economy by 2024-25, there is a need to push Women Entrepreneurs and bridging the rural-urban divide.
    • Also, with the success of Self-help Groups (SHGs) programmes, it is predicted that Women-owned enterprises can generate over 50-60 million jobs by 2030. 
      • A report published by McKinsey Global institute states that USD 12 trillion could be added to global GDP by 2025 by advancing women’s equality.

• For Better Finance Management: 

  • It is a fact that women can easily utilize the funds whether it is raised for home expenses or the business expenditure.
    • Involvement of women especially in money matters can definitely be a game changer in the manner in which wealth is not only managed but also inherited.

• Influencer: 

  • When a man is educated, it’s just an individual is educated but when a woman is educated, it means, a generation is educated. 
    • Women do occupy a position of great influence in their families and if they actively participate alongside the menfolk in financial decisions, it would certainly have a positive impact on the next generation as well. 

• Empowerment & Overall Development: 

  • Economically sound women empower the female population and would lead to the sound development of family, the World.

Government’s Steps to Support Women Entrepreneurs in India

• Constitutional Value: 

  • In India, gender equality is enshrined in the Constitution (Articles 14 to 18) and grants equality and empowers the State to adopt measures in favour of women. 
    • Article 42 of the Constitution of India states that the State should make provisions for securing justice and humane conditions of work and for maternity relief.

• Laws & Regulations: 

• • The Government and its policies have had the empowerment of women at the core since its fifth five-year plan 1974-79, considering the role women entrepreneurs can play in the development of the economy of the country. 

• Ambit of Various Schemes For Women Entrepreneurs in India

• • The Indian Government has created an ambit of new schemes. Additionally, many state governments have rolled out their plans for them. 

• Significance of Government Schemes For Women Entrepreneurs in India: 

  • Over the past few years, the schemes are providing subsidized and accessible capital, connecting them with potential buyers, providing skill and market development assistance, capacity building, providing financial literacy, and access to easy micro-credit facilities to women entrepreneurs.

• Three-tier Boost: 

• • The Women Entrepreneurship in India is receiving a three tier boost, which can be mainly characterised as: 
    • Self Help Groups
    • Women-Led Enterprises
    • Women-Led Start-ups

About Women Entrepreneurship Platform (WEP) of NITI Aayog

• Founding Pillars: 

  • NITI Aayog’s Women Entrepreneurship Platform (WEP) is built on three pillars: 
    • Ichha Shakti: It represents motivating aspiring entrepreneurs to start their businesses.
    • Gyaan Shakti: It provides knowledge and ecosystem support to women entrepreneurs to foster entrepreneurship.
    • Karma Shakti: It means providing hands-on support to entrepreneurs in setting and scaling up businesses.

• Focus Areas: 

• • Through its partnerships, services are provided in 6 main focus areas- Community and Networking, Funding and Financial Assistance, Incubation and Acceleration, Compliance and Tax Assistance, Entrepreneur Skilling and Mentorship and Marketing Assistance.

Challenges Faced By women entrepreneurs in India?

Major problems of women entrepreneurs in India are as follows;

• Lack of Autonomy: 

  • Women receive lesser education, and fewer opportunities and face many hurdles in achieving social, political, and economic autonomy.
    • They face underrepresentation at the various levels of decision-making and unrecognition of their efforts and achievements.

• Societal Pressures: 

  • Entrepreneurship comes with its own set of challenges for both genders. However, the challenges for women are more significant. They are confronted with societal pressures in most regions in India and also globally.

• Limited Access to Finance & Opportunities: 

  • The lack of access to formal financing institutions, coupled with a lack of collateral for loans, often keeps women away from entrepreneurship opportunities.
    • As per World Bank’s Women, Business and the Law 2022 report, “nearly 2.4 billion women of working age worldwide still are not afforded equal economic opportunities. 

• Create Rural-urban Divide: 

  • Women Entrepreneurs in India are generally concentrated in the urban areas, which impacts the rural population where the patriarchal effects are more stark.

• Lack of Technological Exposure: 

  • It creates barriers to the success of women as entrepreneurs in rural areas specifically. 
    • A UNIDO-led study on barriers to women’s entrepreneurship found that women were influenced more by traditional and internal factors than by legal or regulatory obstacles when starting their businesses.

• Very little Contribution to the Science, Technology, Engineering, and Math (STEM) Sector:

• • Women make up only 28% of the STEM workforce and men vastly outnumber women majoring in most STEM fields in college. 
    • This also brings parity in sectors the women choose as entrepreneurs since these sectors will throw up more jobs than expected in the future.

Way Forward to strengthen Women Entrepreneurship in India

• Improve the Quantity and Quality of Start-ups and Enterprises established by Women: By increasing their access to capital and support in funding.
• Exclusive Support: The government should facilitate support during pregnancy and other benefits about childcare, which would help in creating a supportive work environment for them to choose entrepreneurship as a career choice.
• Gender-neutral Approach: Entrepreneurship is gender agnostic, and a fundamental approach for any government to push for the overall economic development of a country must be gender-neutral.
• Work on  the Report of McKinsey Global Institute: It identifies six types of intervention to bridge the gender gap- Financial incentives and support, Technology and infrastructure, Creating economic opportunity, Capability building, Advocacy and shaping attitudes and Laws, policies, and regulations.
• Counter the Prevailing Inequalities: Inequalities also exist in the funding spaces, while many types of research have shown that the success of women-led start-ups is much higher than that of men-led start-ups.
  • There is a need for emphasised and positive policies in favour of women for building strong economies of the country, through various initiatives and scaling up of the initiatives already existing in the country.
• Improvement in Raising Awareness: Awareness levels and acumen about finances will definitely improve, leading to gender parity too when it comes to financial decision-making.

Conclusion

Women entrepreneurship is an essential source not only for the economic growth of a country but can also act as a powerful tool to break off the shackles that existed owing to the extremely pervasive gender inequalities. Women’s entrepreneurship will shift the narrative from women’s development to women-led development.