Syllabus: GS-III & V: Inclusive Growth

Why in the News? 

Economic empowerment in India has travelled two parallel paths — one driven by self-organised community enterprise, and another by State-funded welfare schemes. The story of Lijjat Papad, a ₹1,600 crore women-led enterprise born out of just ₹80, stands as a reminder that empowerment is not merely about aid, but about ownership, dignity and income earned through work.

Case Study: Lijjat Papad – A Homegrown Model of Women’s Empowerment

• Started in 1959 in Mumbai by seven women, led by Darshana Parab, a school dropout.
  
• Seed capital: ₹80, first-year profit: ₹6,000.
  
• Today: 45,000+ women employed, 82 branches, ₹1,600 crore annual turnover (2025).
  
• Decentralised production model – women collect dough, roll papads at home, return finished product, are paid weekly.
  
• Requires no degree, no machinery, no subsidy, just skill and accountability.
  
• A living example of Swadeshi entrepreneurship + cooperative ownership.
  

Key lesson: Empowerment begins when income is earned with dignity, not donated through schemes.

Where Government Schemes Fail

Many “empowerment” plans collapse due to:

• Misuse of funds (e.g., loans spent on TV, jewellery in Assam’s microfinance case)
  
• Lack of monitoring, training and market linkage
  
• Schemes designed for political optics, not long-term income generation
  
• Freebies shifting mindset from work-based dignity to dependency-based survival

Even well-designed schemes fail when intent doesn’t match implementation.

MGNREGA – A Rare Success in Welfare-Based Empowerment

• Launched in 2007 to guarantee 100 days of wage work to rural households.
  
• Gives legal right to work, not a grant or loan.
  
• Increases rural purchasing power, women’s labour participation, and asset creation.
  
• Despite corruption leakages, it remains India’s largest poverty alleviation and livelihood programme.
  

Why it works: Payment for work → dignity + economic stability, not charity.

Assam Link: Lessons from Ground Reality

• Many microfinance and SHG-linked schemes saw loan diversion and high defaults.
  
• The Chief Minister highlighted misuse: loans spent on luxury goods instead of micro-enterprise.
  
• Yet, successful women-led ventures and SHGs do exist — but they succeed where ownership, market linkages and training are strong, not where the State replaces skill with subsidy.
  

Other Grassroots Success: Apple Revolution in Himachal Pradesh

• Started in 1916 by Samuel Stokes, who trained locals and gave them saplings.
  
• Today, the apple economy of Himachal is worth ₹5,000+ crore annually.
  
• No “freebies”, only capacity, knowledge and entrepreneurship support.
  

Way Forward

• Shift from loan-driven empowerment → skill and market-linked empowerment
  
• Promote cooperative and cottage industry models like Lijjat, Amul, Fabindia, Eri silk SHGs of Assam
  
• Strengthen monitoring of funds and outcome-based tracking
  
• Introduce entrepreneurship curriculum for rural women & youth
  
• Merge MGNREGA + skill development + SHG production to create work + product + market cycle
  

Mains Question:
“Women’s empowerment in India cannot be achieved through subsidies alone. Discuss with reference to community-led enterprises and welfare-based employment models like MGNREGA.”

One-Line Wrap:
Real empowerment begins not with free money, but with the power to earn, build and lead.

SOURCE