By Ishita Ganguli Tripathy and Anuradha Guru
The country marked its 75th Republic Day with a grand parade at Kartavya Path, as usual. However, what was different was the women-centric focus. The spotlight was on the incredible strength of women in various fields, ranging from soft skills of folk dances to daring stunts on motorbikes to defence technology. Surely the nation has come a long way from the days of women being looked upon as a lower gender and confined to selected tasks.
Quoting multiple examples, during her speech in the Joint Session of the Parliament held in January 2024, the Hon’ble President of India made it amply clear that Nari Shakti is the way forward for the country’s development, emphasizing the power of the 66 crore women of the country.
As we celebrate another women’s day, we focus on one aspect of the ongoing societal change, viz. increasing the role of women as entrepreneurs. Entrepreneurial skills are inherent in women. They are naturally inclined to do an excellent job as the fourth factor of production, by appropriately combining the other three factors of production, viz. land, labour and capital, in their broader sense.
The unswerving developments in the Indian startup ecosystem are increasingly witnessing women chasing the entrepreneurial dream and thriving in their ventures. The likes of Kiran Shaw (founder: Biocon), Vandana Luthra (founder: VLCC); Falguni Nayar (founder: Nykaa), Nisaba Godrej (Chairman Godrej Consumer Products) and many more, are the shining stars and icons of empowered women leading the way for other Indian women and inspire them.
It is well recognised that unlocking entrepreneurship amongst women can be a social and economic intervention crucial to ensure inclusive economic growth. Women entrepreneurs have a natural talent for being able to deploy more practical and creative approaches to discover and develop business opportunities. According to the Global Entrepreneurship Monitor, Women’s Entrepreneurship Report: From Crisis to Opportunity, “Globally, women represent about one in three high-growth entrepreneurs and one in three innovation entrepreneurs that are focused on national and international markets.”
It is seen that the proportion of women as one moves from informal to formal sectors becomes lower and within the formal sector, with growth in the scale of operations, their figures start dwindling. Recognizing this, the government has been taking steps to increase female representation in entrepreneurship and the data on formalized micro enterprises shows progress on this front.
This is elucidated by the drive taken up, since January 2023, by the central government, along with SIDBI, to formalise informal micro enterprises. The number of women-owned informal micro enterprises which have been formalized by the government of India stands at 70 per cent of the total 1.52 crore enterprises which have been formalized since January 2023.
These women now have an identity which they can use for applying for loans. Similarly, while the proportion of women in the total number of micro enterprises (investment up to Rs 1 crore and turnover up to Rs 5 crore) is 39 per cent, among small (investment up to Rs 10 crore and turnover up to Rs 50 crore) and medium enterprises (investment up to Rs 50 crore and turnover upto Rs 250 crore), the corresponding figures are 12 per cent and 6 per cent, respectively. Expectedly, the proportion of women-owned micro, small or medium enterprises is much more in the services sector (45 per cent) than in the Manufacturing sector (22 per cent).
Policy initiatives of the government underscore the resolve to harness the entrepreneurial potential of women, which can be identified in terms of ‘7As’ viz. ensuring Availability, Accessibility and Affordability of benefits to women entrepreneurs; creating Awareness about the benefits, through Alliances with the private sector; increased Accountability of those who formulate and implement policies; and celebrating Achievements of women.
In keeping with these goals, the government has designed various policies, schemes, and support systems for women entrepreneurs. For example, the Women Entrepreneurship Platform (WEP), an initiative by NITI Aayog, aids and hand-holds women throughout the entrepreneurial journey, from starting through to scaling and expanding the business.
As another example, the ‘Economic Empowerment of Women Entrepreneurs and Start-ups by Women’ (WEE) project aims to pilot incubation and acceleration programmes for women micro-entrepreneurs. Under the PM MUDRA scheme, which extends collateral-free loans up to Rs 10 lakhs to individuals, till February 2024, 68 per cent of about 40 crore loans extended went to women covering 45 per cent of the monetary amount of the loans. Further, under the Pradhan Mantri Kaushal VikasYojana (PMKVY) about 52 per cent of the placements under the scheme were for female trainees.
Going forward, to ensure that the 7As can provide an enabling environment for women to lead the country’s development, some steps which are required and are being taken are as follows.
The first is to integrate financial, digital and data systems which are already in place. This could have diverse spectra including onboarding onto the existing e-commerce platforms; using account aggregators for efficiently managing financial data; accessing available data and analyzing it meaningfully; coordinating the benefits of different central government schemes and successfully coordinating responses of different stakeholders for purposeful implementation of schemes.
The next is to fully integrate supply chains implying that policy interventions work best as a package of access to finance, technology & innovation support; and marketing & networking. A case in point is the recently launched PM Vishwakarma Scheme which offers benefits of finance, technology, marketing, and more to traditional artisans and craftspeople. As many as 66 per cent of the 1.35 crore applications received in the past 5 months since the launch of the scheme are from women.
The third is the move towards a more digital economy, which is the demand of the time. The fourth is enhancing financial literacy among women. Financial counselling stands them in good stead, whether it is in their journey to becoming Lakhpati Didis or prudently deciding about long-term investments in stocks or real estate.
The fifth is to share and learn from each other’s experiences. The last, but definitely not the least in the non-exhaustive list, is the role of men in ensuring women receive their due through support, encouragement, facilitation, and felicitation.
All these are already happening and are a work in progress, with the goal of nurturing female-led enterprises to become unicorns and decacorns of the future.
Ishita Ganguli Tripathy and Anuradha Guru are Officers of the Indian Economic Service. Views are personal.