India’s Care Economy

Context

NITI Aayog’s report “Transforming India’s Care Economy: A Roadmap for Inclusive Growth” proposes a structured, regulated, and professional care ecosystem for children, the elderly, and Persons with Disabilities (PwDs) to promote inclusive growth and support the vision of Viksit Bharat@2047.

Need for a Comprehensive Care Ecosystem

1. Demographic Shift & Social Transition

• Ageing Population: Population aged 60+ is projected to increase from 10% (~150 million) to 21% (~347 million) by 2050.
• Childcare Demand: Around 300 million children (below 14 years) require quality early childhood care.
• Changing Family Structure: Urbanization and the shift from joint to nuclear families have weakened informal caregiving systems, increasing dependence on professional care.
• Disability Care: Around 26.8 million PwDs require long-term institutional and community-based care.

2. Enhancing Female Labour Force Participation (FLFP)

• 79% of women (15–29 years) identify unpaid care work as the main barrier to education and employment, compared to 3% of men.
• Expansion of childcare, eldercare, and home-based care services can:
  • Increase women’s workforce participation.
  • Reduce gender wage inequality.
  • Improve national productivity and GDP.

3. Economic Opportunity & Global Care Workforce

• India’s care economy is expected to grow from $29.62 billion (2023) to $72.31 billion by 2030.
• WHO projects a global shortage of 11 million care workers by 2030, creating an opportunity for India to become a Global Care Workforce Capital through internationally recognized skill certification.

4. International Commitments

The report aligns with:

• G20 Bali Care Economy Dialogue (2022)
• G20 New Delhi Leaders’ Declaration (2023)

These emphasize investment in quality, accessible, and inclusive care infrastructure.

Key Challenges & Policy Gaps

              INDIA'S CARE ECOSYSTEM

                      │

 ┌────────────┬──────────────┬──────────────┬──────────────┐

 │            │              │              │

 ▼            ▼              ▼              ▼

Informal   Gender &      Skill &        Regulatory &

Workforce  Legal Gaps    Training Gap   Financing Gap

1. Informal Workforce & Low Social Protection

• Over 80% of care workers are employed informally.
• Most lack:
  • Minimum wages
  • Health insurance
  • Paid leave
  • Occupational safety
• Women account for 56.6% of this workforce.

2. Gender Bias in Legislation

• Maternity Benefit Act, 1961 places the cost of 26 weeks' paid leave entirely on employers, discouraging recruitment of women.
• India lacks a statutory Paternity Leave law, reinforcing unequal caregiving responsibilities.

3. Skill & Curriculum Deficit

• No uniform alignment with the National Skills Qualifications Framework (NSQF).
• Training quality, ethics, and certification remain fragmented.

4. Regulatory & Financial Gaps

• No dedicated national regulator or comprehensive database for care workers.
• Public expenditure on the care economy remains below 1% of GDP.
• Quality care facilities remain concentrated in major urban centres.

Global Best Practices

1. ILO 5R Framework

2. International Models

NITI Aayog’s Strategic Recommendations

1. Regulatory Framework

• Establish a National Care Services Board under the Ministry of Women and Child Development (MoWCD) in coordination with the Ministry of Housing and Urban Affairs (MoHUA) and the Ministry of Health and Family Welfare (MoHFW).
• Develop standards, licensing systems, and grievance redress mechanisms.

2. Standardized Skill Development

• Develop uniform curricula through the Healthcare Sector Skill Council (HSSC) and National Skill Development Corporation (NSDC).
• Promote specialized training in:
  • Geriatric care
  • Early childhood care
  • Palliative care
• Align certification with international standards.

3. Legislative Reforms

• Introduce government-employer shared financing for maternity benefits.
• Enact a Paid Paternity Leave framework to encourage shared caregiving responsibilities.

4. Formalization & Social Security

• Register all care workers on the e-Shram portal.
• Extend benefits under the Code on Social Security, 2020, including:
  • Provident Fund
  • Health insurance
  • Maternity benefits

5. Private Sector Participation

• Promote Public-Private Partnerships (PPP).
• Encourage investment through:
  • Corporate Social Responsibility (CSR)
  • Viability Gap Funding (VGF)
  • Tax incentives
• Expand community crèches, daycare centres, and assisted-living facilities.

Conclusion

A regulated and inclusive care ecosystem can strengthen women’s participation, create formal employment, protect vulnerable groups, and enhance social welfare while positioning India as a globally competitive provider of skilled care professionals by Viksit Bharat@2047.