UPSC Editorial Analysis: Strengthening Rural Prosperity and Women’s Workforce Participation

*General Studies-2; Topic: Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections.*

Introduction

• The Union Budget 2025-26 aims to foster rural prosperity and resilience by increasing women’s workforce participation and supporting their entrepreneurial growth.

• This comes at a crucial time when self-employment among rural women is rising, as reflected in the Periodic Labour Force Survey (PLFS) 2023-24.

Rising Women’s Workforce Participation and Self-Employment Trends

• Periodic Labour Force Survey (PLFS) Data

• The female workforce participation rate has increased to 40.3% in 2023-24 from 22% in 2017-18. The rise is primarily due to a 15.9% growth in self-employment, particularly in rural areas.

• The female workforce participation rate has increased to 40.3% in 2023-24 from 22% in 2017-18.

• The rise is primarily due to a 15.9% growth in self-employment, particularly in rural areas.

• Self-Employment: A Double-Edged Sword

• While self-employment provides income opportunities, it is precarious and informal, lacking social security and job benefits. Key challenges include: Lack of skill training Limited mobility due to societal norms Barriers in accessing formal credit Heavy domestic and caregiving responsibilities

• While self-employment provides income opportunities, it is precarious and informal, lacking social security and job benefits.

• Key challenges include: Lack of skill training Limited mobility due to societal norms Barriers in accessing formal credit Heavy domestic and caregiving responsibilities

• Lack of skill training

• Limited mobility due to societal norms

• Barriers in accessing formal credit

• Heavy domestic and caregiving responsibilities

Contribution of Self-Employment to Economic Growth

• International Labour Organization (ILO) Study (2019) Findings

• Small enterprises and self-employment contribute to two-thirds of total employment globally. In India, self-employment among women is mostly concentrated in agriculture, but there is a growing presence in manufacturing, services, and construction, necessitating targeted policy interventions.

• Small enterprises and self-employment contribute to two-thirds of total employment globally.

• In India, self-employment among women is mostly concentrated in agriculture, but there is a growing presence in manufacturing, services, and construction, necessitating targeted policy interventions.

• World Bank Study (2024) on Rural Women Entrepreneurs

• Women-owned enterprises in rural India provide employment to 22-27 million people. Access to formal credit remains a significant challenge, highlighting the need for tailored financial inclusion strategies.

• Women-owned enterprises in rural India provide employment to 22-27 million people.

• Access to formal credit remains a significant challenge, highlighting the need for tailored financial inclusion strategies.

Budget 2025-26: Key Initiatives for Women Entrepreneurs and Workforce Participation

• Financial Inclusion Measures

• ₹5.41 lakh crore sanctioned under Pradhan Mantri Mudra Yojana (PMMY) in 2023-24 for women entrepreneurs. New scheme to support 5 lakh first-time entrepreneurs (women, SCs, and STs) with term loans up to ₹2 crore over five years. Increase in budgetary allocation for women’s welfare. Gender allocation in the total budget rose, showing greater commitment to women’s economic empowerment.

• ₹5.41 lakh crore sanctioned under Pradhan Mantri Mudra Yojana (PMMY) in 2023-24 for women entrepreneurs.

• New scheme to support 5 lakh first-time entrepreneurs (women, SCs, and STs) with term loans up to ₹2 crore over five years.

• Increase in budgetary allocation for women’s welfare.

• Gender allocation in the total budget rose, showing greater commitment to women’s economic empowerment.

• Strengthening Self-Help Groups (SHGs) and Rural Livelihoods

• National Rural Livelihoods Mission (NRLM) has integrated rural women into SHGs. SHGs play a crucial role in microfinance, skill development, and entrepreneurship promotion.

• National Rural Livelihoods Mission (NRLM) has integrated rural women into SHGs.

• SHGs play a crucial role in microfinance, skill development, and entrepreneurship promotion.

• Skill Development and Capacity Building

• Pradhan Mantri Kaushal Vikas Yojana (PMKVY) to provide job-oriented training to rural women. Emphasis on sectoral employment, particularly in: Manufacturing Micro, Small, and Medium Enterprises (MSMEs) Services and construction industries

• Pradhan Mantri Kaushal Vikas Yojana (PMKVY) to provide job-oriented training to rural women.

• Emphasis on sectoral employment, particularly in: Manufacturing Micro, Small, and Medium Enterprises (MSMEs) Services and construction industries

• Manufacturing

• Micro, Small, and Medium Enterprises (MSMEs)

• Services and construction industries

Sectoral Opportunities for Women’s Employment Growth

• Boost to Manufacturing and MSMEs

• MSMEs employ a significant number of women, and budgetary support for MSMEs is expected to: Enhance women’s employment Promote women-led start-ups Provide easier access to credit and technology adoption The budget includes a special package covering financing, regulatory changes, and technology support for MSMEs.

• Enhance women’s employment

• Promote women-led start-ups

• Provide easier access to credit and technology adoption

• The budget includes a special package covering financing, regulatory changes, and technology support for MSMEs.

• Support for Women in Labor-Intensive Sectors

• Focus on high-employment sectors like textiles, food processing, and rural industries. Policy measures to reduce informal employment and improve job security and social security coverage.

• Focus on high-employment sectors like textiles, food processing, and rural industries.

• Policy measures to reduce informal employment and improve job security and social security coverage.

Addressing Barriers to Women’s Workforce Participation

• Overcoming Social and Economic Challenges

• Barriers include: Unpaid care work and domestic responsibilities Mobility constraints Lack of digital and financial literacy Government Interventions: Encouragement of working women hubs (MSMEs collaborating to provide hostels, crèches, and senior care facilities). Promotion of gender-sensitive workplace policies in industries employing large numbers of women.

• Barriers include: Unpaid care work and domestic responsibilities Mobility constraints Lack of digital and financial literacy

• Unpaid care work and domestic responsibilities

• Mobility constraints

• Lack of digital and financial literacy

• Government Interventions: Encouragement of working women hubs (MSMEs collaborating to provide hostels, crèches, and senior care facilities). Promotion of gender-sensitive workplace policies in industries employing large numbers of women.

• Encouragement of working women hubs (MSMEs collaborating to provide hostels, crèches, and senior care facilities).

• Promotion of gender-sensitive workplace policies in industries employing large numbers of women.

• Encouraging Financial Inclusion and Credit Access

• Formalizing credit access through women-led banks and financial cooperatives. Strengthening digital banking services for women entrepreneurs in rural areas.

• Formalizing credit access through women-led banks and financial cooperatives.

• Strengthening digital banking services for women entrepreneurs in rural areas.

Way Forward

• Expanding Social Security and Legislative Protections

• Extending social security benefits (pensions, maternity benefits, insurance) to self-employed women. Strengthening enforcement of equal pay and workplace safety laws.

• Extending social security benefits (pensions, maternity benefits, insurance) to self-employed women.

• Strengthening enforcement of equal pay and workplace safety laws.

• Strengthening Digital and Financial Literacy Programs

• Expanding digital literacy to ensure greater participation in online markets and e-commerce platforms. Bridging the gender gap in technology adoption through targeted training programs.

• Expanding digital literacy to ensure greater participation in online markets and e-commerce platforms.

• Bridging the gender gap in technology adoption through targeted training programs.

• Enhancing Rural Infrastructure for Women Workers

• Development of rural business hubs with access to: Coworking spaces Childcare and elderly care facilities Transportation support for working women

• Coworking spaces

• Childcare and elderly care facilities

• Transportation support for working women

• Long-Term Vision: Towards Sustainable Rural Employment

• Strengthening public-private partnerships (PPPs) for skill training and employment. Integrating women-led businesses into global supply chains. Encouraging eco-friendly entrepreneurship in agriculture, handicrafts, and textiles.

• Strengthening public-private partnerships (PPPs) for skill training and employment.

• Integrating women-led businesses into global supply chains.

• Encouraging eco-friendly entrepreneurship in agriculture, handicrafts, and textiles.

Conclusion

• The Union Budget 2025-26 lays a strong foundation for rural women’s economic empowerment by increasing their participation in self-employment and entrepreneurship.

• With a multi-pronged approach involving financial inclusion, skill development, and social security, India can harness the full potential of its female workforce.

• These interventions align with the government’s vision of Viksit Bharat (Developed India) and contribute to sustainable, inclusive growth.

Practice Question:

The Union Budget 2025-26 emphasizes self-employment and entrepreneurship for women, particularly in rural areas. Critically analyze the effectiveness of self-employment as a tool for economic empowerment of women. (250 words)