Mansi Tirthani
Background
Indian rupee is under global pressure hitting historic lows to ₹95 per dollar. This macro volatility ceases to be a mere statistic but in reality it transforms into a structural crisis that impacts women differently. Macroeconomic shocks are transmitted along gendered fault lines. Headlines shift their focus on trade deficits or investor sentiment. But beneath these macroeconomic reports lies a quieter crisis of Indian women’s economic resilience which is hit the hardest.
According to the recently released National Family Health Survey (NFHS-6) only 30.8%of Indian women participate in the workforce where they are exposed to wage disparities and layoff risks in volatile markets. While the remaining majority face limited financial independence that are further burdened when currency depreciates and intensifies household vulnerabilities. Rising import costs for essential commodities like fuel, cooking gas and medicines ripple through household budgets.
These comprise the core areas where women are primary managers. Yet, macroeconomics is never gender-neutral. Beneath the sterile percentages of currency depreciation lies a brutal reality of the modern Indian economy that transmits external macroeconomic shocks directly to the microeconomic survival of the households where women function as the ultimate shock absorbers.
When the rupee drops the international price of crude oil surges in India currency terms. This external price hike cascades through the supply chain that is inflating the cost of transport, fertilizers and LPG cylinders. For the woman of the house this macro volatility is a daily crisis visible in a shrinking kitchen budget, an expensive cooking gas refill that forces her to return to hazardous biomass fuel and the silent reallocation of her micro-savings to cover inflated expenses.
Functioning
To understand how currency depreciation interacts with gender we must look at the past traditional economic insulation models. According to classical consumer theory, inflation acts as a regressive consumption tax because households with low income spend more on inelastic goods like food and fuel. Gender economics deepens this through the lens of intra household resource allocation.
Amartya Sen’s cooperative conflicts model reveals that bargaining power within households is heavily dependent on economic contribution and disposable margins. When external shocks cause inflation domestic food and fuel logistics experience an immediate price surge. As women manage domestic consumption they bear the brunt of this imported shock by compromising their own caloric intake and healthcare needs to protect children and male earners.
RBI estimates a 5% rupee depreciation adds 30–35 basis points to inflation. To balance this RBI increases repo rate. This high interest rate further increases the cost of capital through banks. Women entrepreneurs and Self Help Groups (SHGs) who are dependent on micro credit bear higher interest rates on loans, stricter lending criteria and lastly contraction in economic agency.
Historical financial crises are evidence that currency crises carry heavy gendered costs. During 2013 Taper Tantrum in India when the rupee fell against the dollar it gave rise to domestic inflation in essential food commodities to double digits. Data from National Sample Survey Office (NSSO) shows that during that period there was a decline in rural women’s spending on personal health and hygiene with an increase in time spent on unpaid domestic labor to compensate for expensive market services.
Concerns and Challenges
India imports nearly 85% of crude oil. Depreciation of the rupee by a few points swells the nation under recovery on petroleum products and inflates fertilizer subsidies. This fiscal effect directly limits the financial room available for the Union Gender Budget Statement (GBS).
While the minimal allocation for the gender budget has shown upward trends its proportion relative to total expenditure reveals systemic vulnerabilities. For instance, Part A of the Gender Budget (schemes with 100% allocation for women, such as Pradhan Mantri Awas Yojana and Mission Shakti) is often heavily concentrated in housing and infrastructure. Concurrently, core operational welfare schemes face critical resource constraints.
When adjusting these allocations against inflation the real growth of these budgets is stagnated. This creates a challenge where nominal budgets rise but their operational capacity to fund nutrition, women’s hostels, and one-stop crisis centers is eroded by macro price increases.
Impact
From cooking oil to vehicle fuel women as household budget keepers face rising costs of LPG, food and daily transport. At the macro level, female labor force participation dropped from 23.3% in 2022 to 21.7% in 2025 due to currency driven sectoral stress. Families with Gulf-based workers benefited, as $100 remittance yielded ₹9,600 instead of ₹8,000 but this advantage is unevenly distributed. Even women’s informal savings like gold lose value against dollar-denominated inflation.
Data from CEEW research indicates that whenever domestic LPG cylinder prices cross critical thresholds due to global energy shifts and currency drops the rural and peri-urban households under the Pradhan Mantri Ujjwala Yojana (PMUY) reduce their refill frequency. Women then move back to gathering firewood and dung cakes which increases their unpaid labor and exposes them to high indoor air pollution.
Way Forward
To protect India’s female economy from global macroeconomic shocks policymakers must move beyond post-facto welfare corrections and actively integrate gender guardrails into macro level fiscal planning.
Cash transfers that target women should be insulated from macro driven inflation. The Ministry of Finance in coordination with state departments should implement a Gender Consumption Indexation Model. To prevent central bank rate hikes from hindering female entrepreneurship, banks like Small Industries Development Bank of India (SIDBI) and the National Bank for Agriculture and Rural Development (NABARD) must establish a specialized fund to absorb the interest differential for SHGs and micro-enterprises, keeping their borrowing rates fixed and predictable.
The Union and State governments also need to reform Gender Responsive Budgeting to protect human capital development. To counter the imported inflation India must step upon localized, swadeshi and self dependent alternatives for women. By reducing the female economy’s dependence on fossil fuels and global supply chains the state can build long term resilience against international economic shocks.
Currency depreciation swiftly transfers the volatility of global markets onto the shoulders of Indian women by turning household budgets into economic shock absorbers. By implementing targeted indexing and safeguarding credit channels India can protect its gender dividend and ensure that macroeconomic stability is never equalised at the expense of women’s financial independence.
References
International Institute for Population Sciences (IIPS) and ICF. (2026). National Family Health Survey (NFHS-6), 2023-24: India and State/UT Fact Sheets. Mumbai: IIPS. https://www.nfhsiips.in/nfhsuser/assets/National%20Family%20Health%20Survey%20(NFHS-6)%202023-2024%20Fact%20Sheets.pdf
Sohrabji, N. (2024). Asymmetric exchange rate effects on trade flows in India. Economies, 12(5), Article 114. https://doi.org/10.3390/economies12050114
Chalwadi SV, Joshi PT, Mohanlal Sharma N, Gite C, Salve S. Gender Differences in Inflation Expectations: Recent Evidence from India. Administrative Sciences. 2023; 13(2):60. https://doi.org/10.3390/admsci13020060
Patnaik, Sasmita, Saurabh Tripathi, and Abhishek Jain. 2019. Roadmap for Access to Clean Cooking Energy in India, New Delhi: Council on Energy, Environment and Water https://www.ceew.in/sites/default/files/CEEW-Roadmap-for-Access-to-Clean-Cooking-Energy-in-India-Report-31Oct19-min.pdf
About the Author:
Mansi Tirthani is the recipient of the National Award by the President of India for her contributions to community services. She has been Indian Youth Ambassador to China by Government of India to analyse startup and innovation ecosystem. Currently serves with the Research and Editorial team with a renowned policy think tank, where her work centers on evidence-based governance and policies analysis. With a strong commitment to advancing gender equity and welfare governance, she brings together rigorous data analysis, strategic communication and development to impact research and policy.
Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organisation.
Acknowledgement: This article was posted by Yashkirti Pal, a Research and Editorial Intern at IMPRI.
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