Bring in the Missing Middle

Last May Narendra Modi was elected as Prime Minister. With his concrete plans and actions he creates the right vibes for a growing economy. In the 2nd quarter of 2014 the economy growth was 5,7%; better than any quarter in the last 3 years. The Chinese President Xi Jinping is visiting India these days to explore a more intensive collaboration between the two countries. As a policy maker Modi is busy to allocate resources to expand the economy and create prosperity for all Indians. Although the economy is growing, more than half a billion people still lack the means to meet their basic needs. How to close the gap?

Missing middle
One of the great promises of Modi’s strategy is to expand manufacturing and processing industries.  The World Bank stated in her India Report 2013 the Missing Middle. Small and medium enterprises are typically an important source of wage employment. 93% of the labour force in India is informal employed; this means people have to take care of income themselves, independently and doing business every day again.

Weak value chains
Especially in rural India there are almost no medium sized enterprises. Rural areas are poorly connected to cities, resulting in weak value chains for agricultural products and slow rates of off-farm job creation. India requires the effective development of the rural economy through the expansion of farm and non-farm employment and income opportunities.

Job creating business models
Jobs are an important component of poverty reduction and a cornerstone for development. Women on Wings supports small and medium enterprises with business knowledge in rural India. Expanding manufacturing capacity creates a bigger work force. Like with our business partner Fabric Plus. Last 5 years Fabric Plus showed a growth of almost 25,000 jobs, partly due to a spinning factory. Let’s replicate this job creating business model with the spirit of Modi.