In a textile factory in Tamil Nadu, rows of women weave intricate patterns into fabric, their hands moving in sync with the whir of machines. In a startup hub in Bangalore, a group of young female coders huddle over their laptops, fine-tuning an AI model. In Sikkim, a rural entrepreneur beams as she signs off on a business deal that will expand her dairy farm.
None of this was inevitable. In fact, just seven years ago, India’s Female Labour Force Participation Rate (FLFPR) stood at a dismal 23.3% (among the lowest in the world). Women were working, but much of it was unpaid, informal, or unrecognized. Fast forward to 2025, and something extraordinary has happened. The FLFPR has surged to 41.7%, marking one of the most significant economic shifts of the decade.
So, what changed? And why does this rise in female employment matter for India’s economic future?
Women Enter the Workforce in Record Numbers
Between 2017-18 and 2023-24, FLFPR increased from 23.3% to 41.7%, driven primarily by rural women embracing new employment opportunities. The improvement is striking across states and Union Territories (UTs):
- In 2017-18, 20 states/UTs had FLFPR below 20%. By 2023-24, that number had dropped to just three.
- Currently, 21 states have an FLFPR between 30-40%, a significant improvement.
- Seven states/UTs now boast an FLFPR above 40%, with Sikkim leading at an impressive 56.9%.
What explains this transformation? A combination of government initiatives, entrepreneurship opportunities, and a cultural shift toward valuing women’s economic contributions.
Rural Women Lead the Charge
One of the most remarkable aspects of this change is that it’s being driven by rural women. While urban female participation has also risen, the most dramatic shift has been in the rural FLFPR, which has nearly doubled from 24.6% in 2017-18 to 47.6% in 2023-24.
This is no coincidence. Over the past few years, the government has actively encouraged women’s participation in skilling programs, entrepreneurship, and credit-linked self-employment schemes. Initiatives like Deendayal Antyodaya Yojana - National Rural Livelihood Mission (DAY-NRLM) have helped women in villages gain financial literacy, access microloans, and build small businesses.
From Small Businesses To Startups
Entrepreneurship has become one of the most significant pathways for women to enter the workforce. As of October 31, 2024:
- 73,151 startups with at least one woman director have been recognized under the Startup India Initiative, accounting for nearly half of the 1,52,139 supported startups.
- ₹3,107.11 crore has been invested in 149 women-led startups through Alternative Investment Funds (AIFs).
- ₹227.12 crore in funding has been approved for 1,278 women-led startups under the Startup India Seed Fund Scheme (SISFS).
- The Credit Guarantee Scheme for Startups (CGSS) has guaranteed ₹24.6 crore in loans for women-led ventures.
These numbers show that women are not just entering the workforce but creating jobs themselves.
Yet, the challenges remain. Only 22% of all micro, small, and medium enterprises (MSMEs) are owned by women. This percentage drops even further as businesses scale up:
- Micro enterprises: 22% women-owned
- Small enterprises: 12% women-owned
- Medium enterprises: 7% women-owned
Women entrepreneurs still face credit barriers, limited networking opportunities, and difficulty accessing global markets.
Silent Backbone of India's Economy
Women have long been the invisible force in India’s traditional industries. The numbers tell an eye-opening story:
- 80% of the 4.96 lakh people engaged in the khadi sector are women.
- More than 50% of people in sericulture (silk farming) are women.
- 56.1% of India’s handicraft workforce is female, with certain crafts like embroidery, mat weaving, and handloom weaving being dominated by women.
- The Handloom Census 2019-20 found that 72% of workers in India’s handloom sector are women. These industries may not always grab headlines, but they support millions of rural women and are critical to India’s economy.
Bridge the Digital and Financial Gap
Despite progress, systemic challenges continue to restrict women’s access to finance, technology, and digital platforms. Institutions like the Global Alliance for Mass Entrepreneurship (GAME) are working to bridge these gaps. Through the Women Entrepreneur Financial Empowerment Programme (WEFEP), in collaboration with NRLM, the initiative has:
- Trained 862 "Vitta Sakhis" (financial mentors).
- Conducted outreach and assessments for 20,190 women entrepreneurs.
- Submitted 10,713 loan applications.
- Facilitated 2,400 loans, disbursing ₹30 lakh to rural women entrepreneurs.
Additionally, GAME’s Women Economic Empowerment (WEE) programme focuses on providing rural e-commerce, social commerce, and gig work opportunities.
Gender Pay Gap
India’s workplaces are changing, but slowly. Women remain underrepresented in corporate leadership. A 2023 report on gender diversity revealed:
- Women hold only 23.3% of board seats globally.
- In India Inc., women occupy just 18.3% of board seats.
However, progress is being made. Government-backed incubators like WE Hub in Telangana provide critical technical, financial, and policy support. Since its inception, WE Hub has raised ₹177 crore, incubated 6,376 startups, and engaged 7,828 women entrepreneurs.
The numbers paint a hopeful yet complex picture. Women are entering the workforce in unprecedented numbers, yet cultural and systemic barriers remain. Policies must continue to focus on:
- Providing affordable childcare to enable more women to work.
- Encouraging skill development in emerging sectors like AI, technology, and finance.
- Improving access to credit and reducing compliance burdens for women-led businesses.
For decades, India's economic potential has been held back by low female workforce participation. Now, as women seize new opportunities, the nation is reaping the benefits. A higher FLFPR means a stronger GDP, a more inclusive economy, and a future where every woman’s contribution is recognized.
And as more women step into the workforce, the Indian economy will only grow stronger. This is India’s moment of transformation, and women are leading the way. The question is no longer if women will shape the future of work—it’s how much of that future they will own.
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