New Delhi: The Union government’s public procurement from women-led micro and small enterprises edged closer to the mandated 3% target in the first five months of FY26, after missing it over the past five fiscal years.

The share of goods and services purchased by various ministries and government departments from women-led micro and small businesses rose to 2.82% at the beginning of September, according to data from the government’s Sambandh portal. The purchases totalled ₹1,961 crore.

According to procurement rules, the government must purchase 25% of its total goods and services from MSEs – 4% from Scheduled Caste and Scheduled Tribe-led MSEs and 3% from women-led MSEs. The procurement policy, last revised in 2018, applies to purchases from micro and small enterprises, not medium units.

While the share of government procurement from women-led MSEs has risen from 1% in FY22 to 2.25% in FY25, it has not met the 3% target.

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In FY25, the government procured goods and services worth ₹6,000 crore from women-led MSEs, almost double that of FY24’s ₹3,154 crore. In FY24, the government’s purchases from women-led businesses were 1.85% of the total.

The share of public procurement from women-led MSEs has gone hand in hand with the rise in the share of women-led enterprises. Data from Niti Aayog and the ministry of micro, small & medium enterprises suggested that the share of women-led MSEs increased to almost 40% in September 2025 from about 20% in October 2022.

Niti Aayog, the government’s think-tank, stated in a 2022 study that West Bengal and Tamil Nadu had the highest share of women-led MSMEs. The study clarified that 45% of women-led MSMEs operate in the manufacturing sector, while a little over a third are engaged in agriculture-related activities, especially in the livestock industry.

Limited exposure

“As most women-owned businesses are home-run, micro, and informal in nature, they have limited exposure to market spaces and marketing skills. Female entrepreneurs need to deal with mobility and logistics challenges, time poverty and unpaid care work, and safety and security issues to manage the business and achieve the required growth for the enterprise,” Niti Aayog noted in its 2022 study.

In the Indian context, women-led enterprises are not truly controlled by women, it said, identifying the lack of autonomy of women in businesses due to adverse social norms.

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“The Government is aware that women-owned micro, small and medium enterprises (MSMEs) should be increased in the county,” the union ministry of skill development and entrepreneurship said in a Lok Sabha disclosure on 4 August.

Several government schemes have special provisions for women-led businesses. In the central government’s marquee credit guarantee scheme for MSMEs, women-led businesses receive a higher credit guarantee coverage of 90% compared with 75% for others, along with a 10% concession in annual guarantee fees.

Women entrepreneurs are also provided a higher subsidy of 35%, compared with 25% for others, under the government’s PM Employment Generation Programme, which calls for entrepreneurs in the non-agricultural sector to generate self-employment opportunities.

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Experts said large state-run companies and ministries are likely to purchase from non-MSE suppliers as MSEs often face quality control challenges. But the government’s targeted procurement from MSEs, SC/ST enterprises, and women-led enterprises has helped the sector.