Context:
An editorial highlights how proposed U.S. tariffs on Indian exports could expose deeper structural weaknesses in India’s economy, particularly the low Female Labour Force Participation Rate (FLFPR). The argument frames women’s economic exclusion not merely as a social issue but as a strategic and economic vulnerability, especially when India faces external trade shocks and a narrowing demographic dividend window.
Key Highlights:
External Economic Shock – U.S. Tariffs
- The United States proposes 50% tariffs on nearly $40 billion worth of Indian exports.
- Potential impact: ~1% reduction in India’s GDP.
- Most affected sectors: Textiles, gems & jewellery, leather, footwear.
- These sectors employ nearly 50 million workers, a large share being women.
Status of Female Labour Force Participation
- India’s FLFPR ranges between 37%–41.7%, far below:
- Global average
- China (~60%)
- Low participation weakens:
- Household incomes
- National productivity
- Economic resilience to shocks
Gender Dimension of Trade Vulnerability
- Export contraction (up to 50% decline) could disproportionately displace women workers.
- Informal and low-wage employment makes women more vulnerable to layoffs.
Policy Examples from Indian States
- Karnataka – Shakti Scheme (2023):
- Free public bus travel for women
- Result: 40%+ increase in female ridership, improved mobility and work access
- Rajasthan – Indira Gandhi Urban Employment Guarantee Scheme:
- Over 4 crore person-days of work created
- ~65% beneficiaries are women
Global & Historical Comparisons
- U.S. during World War II: Massive entry of women into workforce boosted industrial output.
- China post-1978 reforms: High female employment supported rapid growth.
- Southern Europe (Italy, Greece): Persistently low FLFPR led to long-term growth stagnation.
Relevant Prelims Points:
- Issue: Low FLFPR amplifying India’s economic vulnerability.
- Causes:
- Unpaid care burden
- Safety and mobility constraints
- Informal work dominance
- Rigid labour markets
- Government Initiatives:
- Free transport schemes
- Urban employment guarantees
- Benefits of Higher FLFPR:
- GDP growth
- Export competitiveness
- Poverty reduction
- Challenges:
- Informality
- Lack of social security
- Impact:
- Underutilisation of demographic dividend
Relevant Mains Points:
- Key Concepts & Definitions:
- Demographic Dividend: Growth potential from a large working-age population
- FLFPR: Share of women working or seeking work
- Tariffs: Trade barriers raising import costs and reducing trade flows
- Economic Linkages:
- Gender inclusion → productivity → resilience to global shocks
- Strategic Implication:
- India’s demographic dividend may close by 2045 without sufficient female employment
- Policy Gaps:
- Informal and gig work lacks protection
- Labour codes yet to fully address women’s work patterns
- Way Forward:
- Formalise gig and part-time work with social security
- Invest in safe transport, childcare, skilling
- Gender-responsive trade and industrial policy
- State-led innovations scaled nationally
UPSC Relevance (GS-wise):
- GS Paper II: Social Justice, Women Empowerment, Governance
- GS Paper III: Economy, Employment, Globalisation, Trade Policy