‘Financial institutions must recognise women’s diverse economic roles, particularly in agriculture, entrepreneurship, and employment’
| Photo Credit: The Hindu
The Union Budget 2025-26 emphasises the government’s commitment to inclusive development, balanced growth and prioritising the well-being of four key population groups: the poor, youth, farmers, and women. In a welcome announcement, the Finance Minister set forth a holistic vision for Viksit Bharat (or Developed India) with ‘zero poverty, universal good quality school education, 100% skilled labour with meaningful employment, 70% women in economic activities, and India as the food basket of the world.’ The explicit inclusion of women as a priority group within this national development framework is commendable and reinforces the government’s pledge towards women-led development.
Gender budget allocation
One of the most notable advancements in the Budget is the increase in the gender budget to 8.8% of the total Budget, a significant jump from 6.8% in the previous year. This is the highest allocation in two decades, with ₹4.49 lakh crore spread across 49 Union Ministries and departments. It reflects a strong commitment to creating a more supportive and empowering environment for women and girls. Further strengthening this commitment, 12 additional central Ministries — many from non-conventional sectors such as railways, ports, shipping and waterways, land resources, pharmaceuticals, and food processing industries — have integrated gender budgets, reflecting a whole-of-government approach to gender mainstreaming.
As in the Periodic Labour Force Survey, India’s female labour force participation rate (FLFPR) measured at usual status has steadily risen, reaching approximately 42% in 2023-24 from 33% in 2021-22. This is approaching the global average of 47%, as reported by the International Labour Organisation. However, a 37-percentage point gap remains when compared to men’s labour force participation of 79%. Achieving the ambitious target of 70% women’s participation in economic activities by 2047 necessitates increased investment in skilling, employment, entrepreneurship, access to productive resources, and social security entitlements — areas that the Budget has acknowledged through its various schemes. Key initiatives such as the Skill India Programme, Entrepreneurship and Skill Development Programme (ESDP), National Skill Training Institutes, Deendayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM), the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), PM Employment Generation Programme, PM Vishwakarma, and Krishonnati Yojana have seen a combined increased allocation from ₹1.19 lakh crore to ₹1.24 lakh crore this year. Approximately 52% of these funds are directed toward women and girls. Additionally, new schemes such as the Prime Minister Dhan-Dhaanya Krishi Yojana, first-time entrepreneurs’ scheme, sustainable livelihood for urban workers initiative, and Centres of Excellence for Make in India, will play a critical role in fostering women’s workforce participation.
A focus on gig workers
With 90% of India’s working women engaged in the informal sector, the Budget’s proposal to formalise gig workers by issuing identity cards and registering them on the e-Shram portal is a significant step. This initiative has the potential to empower millions of women by providing them with formal identity, access to social security entitlements, and financial inclusion benefits.
While the gig economy has offered women financial independence and flexible work arrangements, it often comes with low wages, job insecurity, and a lack of employment rights, including maternity benefits. The enforcement of labour codes and the provision of comprehensive social security measures, including progressive parental entitlements across informal and formal sectors, will be critical to ensure women’s economic security.
The establishment of a Centre of Excellence on Artificial Intelligence (AI) for the education sector and a dedicated ₹600 crore gender budget under the India AI Mission, demonstrate the government’s intent to harness AI for social good. As technological advancements redefine the future of work, investing in digital education, skills, and enterprise training for women will be imperative to ensuring equitable outcomes in the workforce and benefits for the entire economy.
A diversity of economic roles
Financial institutions must recognise women’s diverse economic roles, particularly in agriculture, entrepreneurship, and employment. For example, simplifying documentation requirements for economic and social security provisions, such as delinking Kisan Credit Cards from land ownership, would help women farmers avail loans and credit facilities that they can use to improve crop yields, productivity and expand their agricultural and allied operations. Tracking access and usage of such schemes through gender-disaggregated data would further enhance their effectiveness.
As per the government’s Udyam portal, 20.5% of the micro, small and medium enterprises are women-owned employing about 27 million people. Unlocking finance for women-owned enterprises through collateral-free loans, alternative credit scoring models, and targeted financial literacy programmes will catalyse economic growth. Bain and Company, and Google, claim that establishing 30 million additional women-owned businesses could generate 150-170 million jobs, accounting for over 25% of the job creation needed for India’s working-age population by 2030.
Budget 2025-26 provides a robust foundation for advancing women’s economic participation. Realising the vision of Viksit Bharat requires sustained efforts in policy implementation, infrastructure development, and social norm transformation. By ensuring gender-responsive budgeting, strengthened social protection, and by fostering a labour market which includes both women and men, India can pave the way for women to become key drivers of national growth, ultimately achieving the ambitious target of 70% women in economic activities by 2047.
Susan Ferguson is Country Representative at UN Women India
Published – February 13, 2025 12:08 am IST
