SYLLABUS
GS-3: Indian Economy and issues relating to Planning, Mobilization of Resources, Growth, Development and Employment; Inclusive Growth and issues arising from it.
Context: The Economic Advisory Council to the Prime Minister (EAC-PM) has released a working paper titled “Re-imagining the Care Economy: From Private Burden to Social and Economic Infrastructure”, highlighting the urgent need to formalise and strengthen India’s care ecosystem.
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- The paper argues that rapid demographic transition, population ageing, urbanisation, nuclearisation of families, and rising female labour force participation are significantly increasing the demand for professional care services.
- It emphasises that care work should be viewed not merely as a private household responsibility, but as a critical component of social and economic infrastructure.
Key Recommendations of the Working Paper
- Creation of an Integrated Care Architecture: The paper recommends an inter-ministerial institutional framework involving ministries related to women and child development, health, labour, skill development, and social justice to mainstream care across public policy and service delivery.
- Parivar Seva Kosh (Family Care Fund): The paper proposes an outcome-based public financing mechanism called “Parivar Seva Kosh”, housed within the Ministry of Finance, to support community-driven and multi-generational care infrastructure projects.
- Dedicated Financing Mechanisms: It recommends the creation of a dedicated “Carepreneur Fund” as a special purpose vehicle (SPV) under the Ministry of MSME to provide concessional finance to care-sector entrepreneurs and cooperatives.
- The paper also proposes the establishment of care incubators to support innovation, entrepreneurship, and scaling of childcare, eldercare, and disability-care services.
- Mobilising CSR and Philanthropic Funding: The paper recommends leveraging National and State CSR Xchange portals to channel Corporate Social Responsibility (CSR) and philanthropic funding toward care-sector projects and infrastructure development.
- Development of a Skilled Care Workforce: It proposes large-scale professionalisation of caregivers through standardised certification, skill training, and formal employment pathways to address the projected demand of 31–38 million care workers by 2050.
- Gender-Sensitive Labour and Social Policies: The paper advocates phased reforms in parental leave policies, beginning with statutory paid paternity leave in the private sector and eventually moving toward gender-balanced parental leave frameworks.
- It also calls for flexible work arrangements, social protection measures, and supportive workplace policies to reduce the disproportionate unpaid care burden on women and improve their labour force participation.
About the Care Economy
- The care economy comprises both paid and unpaid activities related to childcare, eldercare, healthcare support, domestic work, disability assistance, and community caregiving.
- Care work may be direct (feeding, teaching, nursing, emotional support) or indirect (cooking, cleaning, household management).
- A large proportion of care work in India remains unpaid and informal, with women performing a disproportionately higher share of domestic and caregiving responsibilities.
- According to the paper, the estimated economic value of unpaid care and domestic work in India is nearly 15–17% of GDP, though it remains largely excluded from conventional economic accounting.
Need for Formalization of Care Economy
- Addressing Gender Inequality and Time Poverty: Women in India spend nearly 289 minutes daily on unpaid domestic and care work, compared to about 88 minutes by men, limiting women’s participation in education, formal employment, and entrepreneurship.
- Supporting Female Labour Force Participation: Formal care services such as childcare and eldercare can reduce unpaid domestic burdens and enable greater participation of women in the labour market, thereby contributing to economic growth.
- Responding to Demographic Transition: India’s elderly population is projected to rise significantly, with senior citizens expected to constitute nearly 21% of the population by 2050, increasing the need for organised eldercare services.
- Employment Generation Potential: Investment in care infrastructure has substantial employment potential as the paper notes that investment equivalent to around 2% of GDP in the care sector could generate nearly 11 million jobs, particularly for women.
- Recognition of Invisible Labour: Formalisation would help recognise caregiving as economically productive work and integrate care-related contributions into broader development planning and social protection systems.