Breaking barriers: Women entrepreneurs leading change
In the transformative era post-1991, India’s economy began a significant journey of renewal with the introduction of policies aimed at liberalisation, globalisation, and privatisation. At the heart of this economic revival is the micro-, small-, and medium-enterprises (MSMEs) sector, acknowledged widely for its indispensable role in shaping the country’s economic landscape. The MSME sector, as outlined by the ministry of MSME, forms the backbone of India’s industrial framework, accounting for 95% of all industrial units. Its contributions are substantial, including 8% to the National Gross Domestic Product (GDP), 50% to the country’s total manufactured exports, and 45% to total industrial employment, making it a critical driver of economic growth and innovation. The Sixth Economic Census, as released by the ministry of statistics and programme implementation, unveils that women represent approximately 14% of total entrepreneurship in India, translating into 8.05 million women entrepreneurs out of 58.5 million. Among these, 2.76 million women entrepreneurs are engaged in the agriculture sector, while a significant majority, over 65%, venture into the non-agricultural sectors.
Despite the promising landscape, women’s ownership in MSMEs remains markedly low, with small enterprises at about 5.26% and medium enterprises at 2.67%. Women helm about 13.5 to 15.7 million enterprises, constituting 20% of all enterprises in India, primarily micro-enterprises. These enterprises are vital, providing direct employment to approximately 27 million individuals. Nonetheless, the World Bank’s estimates suggest that women’s contribution to economic activity in India hovers around a mere 17% of the GDP. An International Monetary Fund (IMF) report further illuminates the potential upliftment of the economy through women entrepreneurship, proposing that it could lead to a 6.8% increase in the GDP, alongside mitigating unemployment.
Research underscores the unique strengths of women entrepreneurs, portraying them as risk-takers who engage in their work with a passion surpassing that of their male counterparts. A study spanning five years by the Boston Consulting Group, in collaboration with Mass Challenge, reveals a paradox: While start-ups led or co-founded by women typically receive less investment compared to those led by men, they remarkably generate higher revenues. This irony highlights not just the financial acumen of women entrepreneurs but also their ability to outperform despite facing numerous challenges. The narrative of women’s entrepreneurship in India is a testament to resilience, innovation, and the untapped potential that, if fully harnessed, could significantly propel the country’s economic growth. Women’s participation and empowerment stand as pivotal elements for societal development, with entrepreneurship offering a promising avenue for achieving such empowerment. As India continues to evolve economically, the empowerment of women entrepreneurs will not only contribute to gender equality but also to the sustainable development of the nation, underscoring the importance of fostering an environment that supports and celebrates women leaders in every sphere of economic activity.
In the dynamic landscape of emerging markets, where formal institutions may be nascent and physical infrastructures often underdeveloped, women entrepreneurs are emerging as a formidable force driving economic transformation. Their growth represents not just a shift in the entrepreneurial paradigm but a significant leap towards inclusive economic development. Recent studies and academic enquiries have increasingly spotlighted the pivotal role women entrepreneurs play in stimulating economic growth, job creation, and in addressing socio-economic challenges such as poverty and social exclusion.
Women entrepreneurs are rapidly becoming recognised for their contributions to the GDP and for their ability to harness human and psychological capital essential for business success. Despite facing moderate challenges, their entrepreneurial ventures are characterised by resilience, innovation, and a profound impact on economic diversification. Critical to their success is the support network that often begins within the family. This network provides not only the initial economic backing but also the moral and psychological sustenance necessary for women to balance professional ambitions with familial responsibilities. Organisational case studies echo the sentiment that investing in women entrepreneurs yields consistent returns and presents a lower risk compared to other investment avenues. Women entrepreneurs often cultivate legitimacy and trust through their entrepreneurial journey by embodying characteristics such as perseverance, passion, hard work, and a clear vision. These traits have shown to foster growth in several dimensions, including employee numbers, financial capital, sales, and operational scale. Women-led enterprises are increasingly venturing into new markets and diversifying their business lines, demonstrating a robust growth orientation.
Interestingly, while businesses owned by women in developing countries might start on a smaller scale, their growth metrics—in terms of sales, revenue, and productivity—rival those of male-owned businesses. This observation underscores the efficiency and growth potential of women-led ventures, challenging stereotypes and paving the way for a more gender-inclusive entrepreneurial ecosystem. Moreover, the entrepreneurship journey for women in developing countries is often fuelled by a quest for independence and self-fulfilment. This drive not only contributes to their personal well-being but also brings about societal benefits by fostering environments where innovation, recognition, and self-realisation thrive. As the narrative around women entrepreneurs continues to evolve, it becomes evident that their impact extends far beyond individual businesses.
In the complex world of entrepreneurship, women are increasingly recognised for their unique contributions and the distinct challenges they face. The intersection of cultural values, economic crises, and the drive for innovation shapes the landscape within which women entrepreneurs operate. Understanding these dynamics offers insights into the resilience, creativity, and strategic networking that characterise women-led enterprises.
Economic crises pose significant challenges for women entrepreneurs, exacerbating vulnerabilities and impacting business sustainability. Studies highlight the adverse effects of crises on women-led businesses, with social norms, education, and networking emerging as critical areas of concern. Innovation is at the heart of entrepreneurial success and sustainability. Women entrepreneurs are particularly adept at continuous learning, adjusting to new situations, and leveraging innovation for growth and competitive advantage. Their inclination towards risk-taking and exploration of novel opportunities translates into innovative practises that enhance firm sustainability and market value. The role of collaboration, family support, and the effective use of technology are underscored as vital components in the innovative processes of women-led ventures.
Moreover, networking and resilience emerge as critical factors enabling women entrepreneurs to navigate through challenges and thrive. Strong networks provide access to new ideas, knowledge, and resources, fostering adaptability and resilience in the face of adversity. The Covid-19 pandemic highlighted the resilience of women entrepreneurs, showcasing their ability to innovate and adapt during crises.
As India strides towards a brighter economic future, the narrative of women entrepreneurs stands as a beacon of hope and resilience. Their journey, marked by innovation, perseverance, and the pursuit of empowerment, not only reshapes the business landscape but also propels societal advancement. The recognition and support of women entrepreneurs in emerging markets are not merely acts of social justice but strategic imperatives for sustainable and inclusive growth.
This article is authored by Gurjeet Kaur Sahi, professor, University of Jammu and Pratik Modi, School of Management, BML Munjal University.
