‘India has potential to create over 30 million women-owned enterprises; upto 170 mn more jobs’

India has the potential to create over 30 million new women-owned enterprises, potentially creating 150 to 170 million more jobs, said KPMG at the TiE Global Summit 2024 here on Tuesday.

Boosting venture capital (VC) funding in women-led startups in India was essential to unlocking the country’s untapped entrepreneurial potential and driving inclusive economic growth; increasing VC support can help bridge the gap in capital access, enabling women founders to scale their businesses, create jobs and contribute to the economy on a larger scale, the consulting firm said in a study released on democratisation of entrepreneurship in India.

Multiplier effect

The report further said, investing in women-led ventures has a multiplier effect, as women entrepreneurs are more likely to reinvest in their communities, thus promoting local development and inspiring future generations. A boost in VC funding would not only champion gender equity but also strengthen India’s innovation landscape by fostering a more diverse and inclusive entrepreneurial ecosystem, it said.

Addressing an audience of startup entrepreneurs, futurepreneurs, industry experts and venture capital investors gathered from all over the world, Akhilesh Tuteja, Client’s and Market Partner, KPMG, said over 20% of India’s MSME startups were by women-led ventures and 45% of these came from tier 2 and tier 3 cities.

Another KPMG study on the rise of India’s startup ecosystem, observed that it has grown significantly over the past decade due to a vast consumer market, supportive government policies, a surge in venture capital (VC) funding, talent availability and the younger generation’s entrepreneurial spirit. A strong network of incubators and accelerators further supports startups growth.

In FY23, startups contributed about $140 billion to the economy, which is projected to reach $1 trillion by 2030. From FY16 to FY23, they contributed 10 to 15% to India’s GDP growth.

Other cities

While Bengaluru, Delhi and Mumbai have been the traditional unicorn hubs, securing over $8.1 billion in funding in CY23, other cities including Pune, Chennai and Hyderabad are carving out their own space in the startup ecosystem, it found. VC funding, being instrumental in the growth story of Indian startups in India, witnessed a 43% year on-year increase from January to July 2024, representing 7% of the total count of globally announced VC funding during that time.

Scope for investment

According to the report, the Indian startup ecosystem is rapidly expanding across various sectors such as fintech, automotive and healthtech, indicating a broadening scope for investment opportunities.

By 2029 the Indian electric vehicle (EV) market is expected to be worth about $113 billion. This will require the creation of at least 1.3 million charging stations in India to support the fast-paced growth of EVs. This situation presents a vast opportunity for startups to delve into the sector.