Skip to main content

India's gender wage gap "highest" in world, but financial divide now "narrowing"

By Moin Qazi*
Men and women should own the world as a mutual possession. -- Pearl S Buck
Gender inequality is not only a pressing moral and social issue but also a critical economic challenge. McKinsey Global Institute report finds that $12 trillion could be added to global GDP by 2025 by advancing women’s equality. India continues to fare badly in gender parity and that is bad news because leaving half the population behind would.
The World Economic Forum’s (WEF) Global Gender Gap Report 2018 has found that on average women across the world are paid just 63% of what men earn. There is not a single country where women are paid as much as men. Gender parity is fundamental to whether and how economies and societies thrive. Differences in economic opportunity are so vast it’ll take 202 years to fully bridge them.
India has been ranked 108th among 149 countries in overall gender gap but ranks 142nd in economic opportunity . Gender gap is measured across four key pillars -- economic opportunity, political empowerment, educational attainment, and health and survival.
According to the Global Wage Report 2018-19, the flagship publication of the ILO, women are paid most unequally in India, compared to men, when it comes to hourly wages for labour. On average, women are paid 34 per cent less than men, it has found. This gap in wages, known as the gender wage gap, the ILO report says, is the highest among 73 countries studied by it.
Gender parity is one of the foundational objectives of the United Nations’ Sustainable Development Goals (SDGs).Together with economic payoff, investing in women and girls can transform millions of lives for the better. Currently, the contribution of Indian women to the GDP (17%), is not only far below the global average (37%), but is also less than that of China (41%) and sub-Saharan Africa (39%).
The deck is overwhelmingly stacked against them. Although India has narrowed the divide between men and women in primary education and health sector, it doesn’t measure well in major metrics, including financial access, for measuring gender parity.
India’s gender gap has taken the shine off its strong economic performance in recent years in terms of gender parity India fares low in financial inclusion gender gap (referring to the disproportionate exclusion of women from access to and usage of formal financial services).
India’s flagship financial inclusion programme has significantly changed the demographics. India is now at a tipping point, with sharply narrowing gender gaps in financial access. According to the World Bank’s Global Findex Survey (2017) 80% Indian adults now have a bank account -- 27 points higher than the 53% estimated in Findex 2014 round. Findex 2017 estimates that 77% of Indian women now own a bank account against respective 43% and 26% in 2014 and 2011.
On this basic measure of financial inclusion, females are more financially included than before. The male-female difference, or the gender gap, in account ownership narrowed to 6.4 percentage points in 2017; it was 19.8 in 2014.Gender inequalities in access to formal credit have long manifested in India’s scarce gender-wise financial statistics. For example, distribution of outstanding credit in small borrower accounts shows 24.5% share of female account owners against 72% by men as on March 2017.
Women’s participation in the financial system can have significant benefits in terms of economic growth, greater equality and societal well-being. Access and usage of financial services are levers for increasing women’s participation in the economy.
Experience worldwide shows that when a woman receives money, her entire extended family profits from it, as women make the best use of it .they are in fact one of the wisest investors .We create the most powerful catalyst for lasting social change. For all interventions, the fundamental logic is plain: if we are going to end extreme poverty, we need to start with girls and women.
Financial inclusion offers the power to change families and societies. According to Christine Lagarde, Managing Director, International Monetary Fund (IMF):
“Women, in particular, often bear the brunt of poverty and limited access to economic opportunity, including unfavorable financial access…Inequality is not just a moral issue—it is a macroeconomic issue…Growth has to be more inclusive, and for this, finance has to be more inclusive…to close the gender and inequality gap.”
Closing the gender gap is essential to realizing the promise of financial inclusivity. It is also critical because the business case for women’s financial inclusion is now universally acknowledged. Experience of microfinance providers has shown that women are safe bets for banks; they pay back loans faster, default less often, and bounce checks less frequently. When accessible finance reaches women, the benefits are highly productive and sustainable. The positive economic knock-on effects are obvious.
Savings rates are higher; repayment rates of family loans are remarkable; social cohesion is stronger and enterprise growth is stable. The experience of most microfinance programmes is that low-income women are highly dependable and trustworthy borrowers. This evidence should make us understand that increasing the proportion of female account holders will decrease systemic risk in the economy.
A greater financial inclusion of women can go a long way in closing the gender gap. Financial inclusion of women enhances their self-confidence and places financial decision-making power in their hands resulting in large development payoffs. It is often cited as an essential tool in helping women in particular rise from poverty.
Women are often underserved by traditional financial institutions. In all societies, howsoever oppressed or illiterate women their women are, they remain the stewards of household savings. They require financial products and services that appreciate their experience and perspective.
The theory goes that when you empower women financially they’re able to secure their families’ welfare and create pathways toward education and improved quality of life for their children. Women’s participation in the financial system can have significant benefits in terms of economic growth, greater equality and societal well-being. Access and usage of financial services are levers for increasing women’s participation in the economy.
Women also need legal immunity from debts accrued by their husbands. According to a Harvard Business Review study, women in emerging markets reinvest 90% of every dollar earned into “human resources”— their families’ education, health and nutrition — compared to only 30% to 40% of every dollar earned by men.
There are measurable improvements in child nutrition and education, family health and household sanitation, shelter and general welfare. Changing long-held beliefs, practices and laws may be difficult, but it is the only way to keep price tags off women and ensure them dignity and financial independence.
We do not necessarily need gender-specific policies, but rather policies that work for women. We need an enabling environment that incorporates women’s perspectives. We must understand that financially empowering women generates a multiplier effect in having a substantial impact on the well being of future generations.
Thus, an enabling financial landscape with a blend of a favourable regulatory regime, innovative women-centric products/schemes, enhanced mobility, robust customer protection framework and reformed attitudes towards women will increasingly stimulate women’s foray into the workforce and yield success for the Indian economy.
Lack of financial access has a regressive influence on women. Melinda Gates, co-chairperson of the Gates Foundation says:
“When women have money in their hands and the authority to choose how to spend it, they grow in confidence and power by taking control of their economic future... We already know a lot about how to make sure women have equal access to financial services that can change their lives... When the government deposits social welfare payments or other subsidies directly into women’s digital bank accounts, the impact is amazing. Women gain decision-making power in their homes.”
Digital financial literacy among women can dramatically change the financial inclusion landscape. Women often face several additional barriers, other than the universal constraints that low income communities face: limited access to mobile phones, lower literacy levels, less confidence in using technology, and restrictions on travel or social interaction.
Digitizing government-to-person (G2P) social safety net payments can accelerate onboarding of more women for adoption and use of digital financial services. The state can use these transfers to build familiarity and instill in women the habit of using these accounts.
The President and CEO, Women’s World Banking, Mary Ellen Iskenderun has set the right tone for a more women-enabling financial inclusion agenda: “There is a strong connection between women’s access to financial products and services and greater opportunity not only for that woman herself, her family and her community, but really for the nation as a whole.”
---
*Member, NITI Aayog’s National Committee on Financial Literacy and Inclusion for Women

Comments

TRENDING

North Gujarat gram panchayat bars villagers from dealing with Muslim hawkers, traders

By Our Representative  A gram panchayat in North Gujarat has barred its residents not to buy anything from Muslim traders and hawkers. An order of the Waghasan group gram panchayat of Tharad taluka of Banaskantha district dated June 30 states that the decision has been taken in the wake of beheading of a Hindu tailor after he posted a derogatory writeup on Prophet Mohammad in Udaipur. The gram panchayat resolution says, anyone seen buying or selling any commodity from a Muslim hawker or trader would be fined Rs 5,100. Bringing this to light, Mujahid Nafees, convener, Minority Coordination Committee, in a letter to Gujarat chief minister Bhupendra Patel, says, the state government should take legal action against the panchayat chief who has signed the “unjust” order. The letter says, the act of the sarpanch and other signatories is a violation of rule of law of the state and threat to peace, pointing out, the move is in violation of Article 15 of the Constitution, which says that none

Unlike Soviet Union, Russia is no friend to India: Ukrainian scholar tells 'Indian friends'

Counterview Desk In an open letter to "dear Indian friends", Anastasia Piliavsky, born in Odessa, Ukraine, studied at Boston and Oxford Universities (on a Rhodes Scholarship), and now teaches at King’s College, London, has said that she faces "deep moral dilemma", personally and professionally, over the "astonishingly unified Indian response to the war in Ukraine." Based on her interaction with a "number of thoughtful and caring Indian friends", in this letter, she says, she is "reeling at the ubiquitous silence at, justifications of or outright support for Putin’s terror, which now prevails in India, at the ubiquitous #IStandWithPutin and #istandwithrussia hashtags." She insists, India must understand, "Unlike the Soviet Union, Russia is no friend to India. Soviet leaders, beginning with (the Ukrainian) Nikita Khrushchev – who declared hindi rusi bhai bhai – built up deep political and cultural exchange with India." Text : I

Technocratic globalism, tyranny? Health Ministry warned: bill to 'enslave' Indians

Sandeep Pandey, Tushar Gandhi By Rosamma Thomas*  Union of Concerned Citizens, a group comprising Magsaysay Award winner Prof Sandeep Pandey, human rights activist Tushar Gandhi, former judge of the Bombay High Court BG Kolse Patil, pediatrician Dr Jacob Puliyel and several renowned Indian citizens have written to the Union Health Minister cautioning him against tabling the draft Public Health Bill in the Monsoon Session of Parliament. “The Public Health (Prevention, Control And Management Of Epidemics, Bio-Terrorism And Disasters) Bill, 2017 and a Prospective Bill of 2022 as discussed in news articles, is straightforwardly violative of Fundamental Rights of the citizens of India and therefore, Ultra Vires of the Indian Constitution. It contravenes several International Treaties and Conventions including the Nuremberg Treaty of 1947 which was enacted to ensure that no country would repeat such inhuman medical atrocities on fellow human beings”, the 12-page letter reads. “Strangely, t

Protesters demand release of Teesta Setalvad, Sreekumar, seek review of SC order

By Our Representative  Protests broke out across India on June 27 following Teesta Setalvad’s arrest demanding her immediate release. Sabrang India , a site run by Setalvad, claimed she was “arrested on trumped-up charges after the Supreme Court dismissed the petition moved by Zakia Jafri demanding an investigation into the larger conspiracy behind the 2002 Gujarat violence.” The protesters also demanded release of former DGP Gujarat police RB Sreekumar, also arrested simultaneously. The protests were preceded by over 2,200 people from across the globe signing a statement demanding their immediate release. Leading signatories such as People’s Union for Civil Liberties (PUCL) general secretary V Suresh, National Alliance of People’s Movements (NAPM) convenor Medha Patkar, former Naval chief Admiral Ramdas. “The state has used the observations made in the judgment to falsely and vindictively prosecute those who had struggled for justice even in the face of state callousness and complicit

Buddhist shrines were 'massively destroyed' by Brahmanical rulers: Historian DN Jha

Nalanda mahavihara By Our Representative Prominent historian DN Jha, an expert in India's ancient and medieval past, in his new book , "Against the Grain: Notes on Identity, Intolerance and History", in a sharp critique of "Hindutva ideologues", who look at the ancient period of Indian history as "a golden age marked by social harmony, devoid of any religious violence", has said, "Demolition and desecration of rival religious establishments, and the appropriation of their idols, was not uncommon in India before the advent of Islam".

Electoral bonds scheme 'compromises' voluntary nature PM relief fund donations

By Rosamma Thomas*  The Prime Minister’s National Relief Fund (PMNRF) is meant to collect voluntary donations from the general public, either individuals or organizations, to enable assistance to people in times of natural disaster, or for expensive medical treatment. That fundamental voluntary character of the fund, however, has changed in recent years.  The gazette notification of January 2018 announcing the Electoral Bond scheme states, in Clause 12 (2): “The amount of bonds not encashed within the validity period of fifteen days shall be deposited by the authorized bank to the Prime Minister’s National Relief Fund”. The Union government has, thus, through notification, directed funds to be deposited into what was meant to be purely voluntary. Commodore Lokesh Batra, who has been campaigning for transparency in government functioning, holds that once a gazette notification has been issued directing that funds be deposited into the PMNRF, the character of the whole fund has changed,

'Highly abnormal': AltNews journo's arrest suggests 'deterioration in media freedom'

By Bharat Dogra*  Leading media organizations have come out in strong support of recently arrested journalist Mohammed Zubair. These organizations include, among others, the Editors Guild of India, the Press Club of India, the Delhi Union of Journalists and DIGIPUB, a platform for several important digital media organizations. All these organizations have condemned the recent arrest of the noted journalist and demanded his immediate release. While leading human rights organizations and political parties have also made somewhat similar statements, the strong support of media organizations is particularly important as the effort of the authorities has been to try to present the arrested journalist as someone who has been indulging in irresponsible journalism.  In such a situation the support of those media organizations who are familiar with his work and who are most capable of judging the quality of his work is very important. In this context it is important that some media organization

Majoritarian silence helping Hindutva forces 'handover' national resources to corporates

By Bhabani Shankar Nayak*  The majority of Indian citizens are witnessing the persecution and everyday violence against their fellow citizens who are Muslims and religious minorities. The growing assaults on reason, science, secularism, Indian democracy and constitution are going to be landmarks in Indian history of diminishing democracy and citizenship rights. It is clear that Hindutva ideology is directly promoting sectarian politics of hate which is dangerous for the unity and integrity of India, peace and prosperity of Indians. The majoritarian silence helps in empowering Hindutva and their electoral dividends. From witnessing the persecution in the sidelines to the active participation and cheering loud or silence accelerates violence against our neighbours and our fellow citizens. How and why do majority of Indians stay silent and contribute to the persecution of their fellow citizens who are Muslims and religious minorities? The question baffles me as an Indian because I have gr

Electricity Bill: Centre's reform measures contain 'carrot and stick package' for states

Counterview Desk  The Peoples’ Commission on Public Sector and Public Services (PCPSPS), claiming to be a network of eminent academics, jurists, erstwhile administrators, trade unionists and social activists, seeking consultations with stakeholders with those who are against the government’s decision to monetise, disinvest and privatise public assets/enterprises, has said that the proposed Electricity (Amendment) Bill-2022 will have far-reaching impacts on the finances of states. Insisting that the proposed Bill would lead to “assault on India’s federal structure”, in a statement, it says, it would weaken the finances of states’ power distribution companies, have adverse impact on utility employees, cripple the states' finances, impose a heavy cost burden on the smaller subsidized consumers (especially farmers), and benefit only corporate business houses. “States cannot afford to ignore the far-reaching implications of the Bill on their economy, finances, agricultural and industria

Cops 'refuse to register' complaint after BSF shot landless worker off Bangla border

By Our Representative  Kirity Roy, secretary, Banglar Manabadhikar Suraksha Mancha (MASUM), and national convener, Programme Against Custodial Torture & Impunity (PACTI), in a complaint to the National Human Rights Commission (NHRC), referring to the incident of “firing and execution” of a poor Muslim youth, has alleged that the 26 year old was was shot at “without giving any warning” one and half kilometers inside the Indian territory from Bangladesh border by an on- duty Border Security Force (BSF) personnel. Stating that the person, Ruhul Mondal, belonged to an Other Backward Class (OBC), and hailed from Ramnarayan Para village under Sagarpara police station in Murshidabad district, West Bengal, Roy in his representation said, the BSF person who shot at him is “attached with Singpara Border Outpost, 141 Battalion”, underlining, the BSF has now floated “self defense theory” to cover up its operation. According to the BSF officials, the incident took place in the jute fields in