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India Inc. is grappling with a gender diversity crisis, with only 3.2% of Fortune 1000 India companies being led by women MDs/CEOs, according to a 2024 Fortune India-SPJIMR study. Despite evidence that diverse leadership teams enhance business performance, systemic barriers continue to push women out of the workforce.
Annette Dixon, former World Bank South Asia Vice President (now retired), stated in 2018 that India's GDP growth could increase by 1.5 percentage points to 9% annually if women's workforce participation reached 50%.
To counter this trend, the study suggests a bold policy move—corporate tax breaks for companies that actively hire and promote women.
Hiring women in leadership roles often imposes additional financial costs on companies, from paid maternity leave to return-to-work support programmes. To incentivise diversity, experts recommend tax rebates similar to California’s solar tax credits or Rwanda’s gender-equality tax incentives.
July 2025
In the world’s youngest nation—where over 65% of the population is under 35—India’s future is already being shaped by those bold enough to lead it. From boardrooms to breakout ideas, a new generation of business leaders is rewriting the rules. This year's Fortune India’s 40 Under 40 celebrates these changemakers—icons in the making like Akash Ambani, Kaviya Kalanithi Maran, Shashwat Goenka, Parth Jindal, Aman Mehta, and Devansh Jain—who are not just carrying forward legacies but boldly reimagining them for a new era. Alongside them are first-generation disruptors like Sagar Daryani, scaling Wow! Momo with a vision to take ₹100 momos to 5,000 cities, and Palak Shah, turning the Banarasi weave into a global fashion story with Ekaya Banaras. These are the entrepreneurs turning ambition into scale. And even beyond traditional industry, the entrepreneurial wave is pulling in creative forces—Ranveer Singh, for instance, is shaking up wellness and nutrition with Bold Care and SuperYou, proving that passion, backed by purpose, is the new blueprint for building brands.
Already operational in the U.S., the Work Opportunity Tax Credit allows employers to claim 40% of wages paid (up to $6,000) for hiring individuals from disadvantaged groups facing employment barriers.
Under the proposed framework, companies demonstrating tangible progress in gender diversity—through recruitment, leadership appointments, and retention strategies—could qualify for a corporate tax reduction. Additionally, tax sops on GST for setting up childcare facilities could encourage more firms to invest in workplace support for working mothers.
For instance, Section 80JJAA of the Income Tax Act, 1961, offers companies a 30% tax deduction on additional employee costs when hiring new employees, subject to certain conditions. Expanding the scope of this section could provide further corporate tax rebates to employers hiring women.
Some corporate leaders argue that such incentives would push more organisations to take meaningful action on diversity. “If companies investing in diversity receive tax benefits, it will accelerate the hiring and retention of women,” says the CEO of a leading manufacturing firm.
However, critics warn that tax breaks alone won’t dismantle deep-seated biases. The study also recommends mandatory diversity reporting for both listed and unlisted firms, women-focused leadership sponsorships, and state-level policy reforms.
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