India lags significantly behind global trends in women's entrepreneurship, with less than 1% of Indian women engaging in entrepreneurial activities. This figure contrasts sharply with the global average and highlights a significant gender disparity in the country's business landscape. While India aligns with the global pattern for men, with approximately 3% of working-age men (15–64 years) being entrepreneurs, the underrepresentation of women is a major concern.
This disparity is particularly striking given India's stage of economic development. A research paper presented at NCAER's India Policy Forum revealed that while female labor force participation explains much of the gender gap in self-employment, it does not account for the underrepresentation of women in entrepreneurship. The study, drawing upon World Bank data covering 186 countries in 2022, identifies India as a significant outlier in terms of low female entrepreneurship.
Several factors contribute to this situation. Unequal access to capital is a key barrier, with women entrepreneurs facing higher rejection rates when seeking financing. Many small Indian enterprises are self-financed or rely on family support, which is often more difficult for women to access. A Bain & Company and Google survey found that 43% of women reported a lack of family support for their businesses. Furthermore, just 0.3% of India's venture capital funding went to women-led startups in 2021, and women-led businesses face an unmet credit gap of over $11.4 billion.
Beyond funding, societal expectations and gender bias pose significant challenges. Women entrepreneurs often encounter skepticism regarding their leadership abilities, particularly in male-dominated industries. Balancing entrepreneurial ambitions with familial responsibilities also remains a major hurdle. Additionally, women entrepreneurs in India have limited access to professional networks, making it difficult to find vendors, collaborators, and build social capital. The lack of female role models and mentors further compounds these challenges.
Despite these obstacles, women entrepreneurs are making significant contributions to the Indian economy. Women-owned enterprises constitute approximately 20% of all micro, small, and medium enterprises (MSMEs) in India, employing 22 to 27 million people. Moreover, studies have found that startups founded and co-founded by women generate more revenue and create more jobs. The Economic Survey 2025 noted that over 50% of India's artisans are women, but only 22% of MSMEs are women-owned. This indicates a need to support women in scaling up their enterprises.
Recognizing the importance of women entrepreneurship, the Indian government has launched several initiatives to support women-led businesses. Schemes like the Mudra Yojana, Stand-up India, and the Women Entrepreneurship Platform (WEP) aim to provide financial assistance, skill development, and mentorship. However, many schemes lack specific tailoring for female entrepreneurs, and reliance on offline applications poses accessibility challenges.
To bridge the gender gap in entrepreneurship, a multi-faceted approach is needed. This includes enhancing access to capital through gender-focused investment funds and women-centric incubators. Challenging societal norms through educational programs and media representation is crucial to redefine women's roles in business. Providing support for work-life integration and expanding networking and mentorship opportunities are also essential. Furthermore, policy reforms, corporate responsibility, and community engagement are necessary to cultivate an inclusive entrepreneurial ecosystem. By addressing these challenges and creating a supportive environment, India can unlock the immense potential of its women entrepreneurs and drive significant economic growth.
