Boosting India’s Economy: The Case for Increased Female Workforce Participation

India’s manufacturing sector stands to gain significantly if more women join the workforce, with a projected increase in output of 9%, according to the World Bank’s recent South Asia Development Update. This report underscores the untapped potential of female labor in the Indian economy and highlights broader implications for GDP growth. The World Bank also maintained its GDP growth forecast for India at 7% for the fiscal year 2025 and 6.7% for fiscal year 2026, attributing much of this optimism to robust domestic demand and improving economic conditions in neighboring countries like Sri Lanka and Pakistan.

The findings illustrate that enhancing female labor force participation is not just a matter of social equity; it is also a crucial economic strategy. The World Bank’s research indicates that achieving gender parity in labor participation rates could result in a remarkable 51% increase in regional GDP across South Asia. The report reveals that, on average, women’s employment drops by 12 percentage points after marriage in four key South Asian nations—India, Maldives, Nepal, and Bangladesh. This decline points to systemic barriers and cultural norms that restrict women’s economic involvement, suggesting that targeted policy reforms could pave the way for greater workforce inclusion.

Martin Raiser, the World Bank Vice-President for South Asia, emphasized the necessity of key policy reforms aimed at integrating more women into the workforce. Such reforms could include providing better childcare options, improving workplace safety, and establishing equitable hiring practices. By removing barriers to global investment and trade while simultaneously promoting female participation, India could witness accelerated economic growth.

The latest Periodic Labour Force Survey highlights a positive trend, with India’s labor force participation rate (LFPR) for women rising to 41.7% in FY24, up from 23.3% in FY18. This increase reflects a growing acknowledgment of women’s contributions to the economy and signals a shift in societal attitudes towards women in the workforce. However, while the progress is encouraging, there is still a long way to go to achieve gender parity.

The manufacturing sector, in particular, stands to benefit from a more inclusive workforce. Industries that traditionally rely on labor-intensive processes could experience enhanced productivity and innovation by tapping into the skills and talents of women. Furthermore, with India’s ongoing economic recovery and the government’s push for self-reliance through initiatives like “Make in India,” integrating more women into the workforce aligns perfectly with national objectives to bolster manufacturing output and competitiveness.

The implications of these findings extend beyond economic metrics. Increasing female participation in the workforce can lead to better family incomes, improved education for children, and overall enhanced quality of life. As women gain financial independence, they can contribute to household decisions, fostering a more balanced approach to economic and social issues.

In conclusion, the World Bank’s findings make a compelling case for the urgent need to address barriers that hinder women’s participation in the workforce. By prioritizing gender inclusivity in labor policies, India not only stands to enhance its manufacturing output but can also drive significant economic growth. As the nation progresses, harnessing the full potential of its female workforce will be key to achieving sustainable development and equitable prosperity for all.