Interview
Coaching Women Entrepreneurs
Rajni Aggarwal, President, Federation of Indian Women Entrepreneurs
ERT: What are the most important ser-
vices a women’s business association should
provide its members?
MRS. AGGARWAL: The most impor-
tant service we provide is counseling be-
cause most of the time women don’t
know where to start or what kind of
enterprise they should take up. So our
main thrust is to guide them towards
making a decision based on their situa-
tion; in other words, assessing the kind of
environment they are in or the kind of
family support they have. Based on this
information we try to help them identify
options and make a decision.
Second, we try to see that most of the
women get help with the formalities
required by the government and with
acquiring financing. Government pur-
chases are important to many businesses
and learning how to tender offers to the
government is important to their success.
For example, someone may have a tailor-
ing shop but doesn’t know how to sell its
services to the military. We try to help
them out in filling out the tenders, getting
their organization registered, etc. It’s a
form of marketing support.
Training programs are another service
we provide. There are women running
very small enterprises who don’t even
have the most basic level of business
know-how. In India, the Ministry of In-
dustry has established the Small Indus-
tries’ Institute that has facilities in all the
major cities where women (and men) can
ECONOMIC REFORM TODAY NUMBER TWO 1997
in India
get training on manufacturing agricultur-
al products, jewelry, and other products.
We assist women entrepreneurs to obtain
training at these government-owned fa-
cilities, as well as at others established by
some private companies.
Fourth, women often are not able to
get the information they need to run their
businesses. We provide it to them because
often their involvement in family affairs is
so great that they do not have time or
they are not able to gain access to infor-
mation they need for their businesses. We
also encourage them to come at least two
or three times to one of our local chapters
and interact with other members. News-
letters are also an important means of
providing essential information to our
membership. We find it useful to ask
members for different topics and ideas for
our newsletter.
ERT: How is the Federation of Indian
Women Entrepreneurs (FIWE) structured
and what are its goals?
MRS. AGGARWAL: FIWE started in
1966 as an umbrella organization for local
organizations around India. FIWE was
part of the Federation of Small and Medi-
um Enterprises (FISME) but in Sep-
tember 1996, we separated the two orga-
nizations, though our objectives and mis- Rajni Aggarwal is also secre-
sion remain the same. FIWE doesn’t pro- tary general of the Inter-
mote direct membership except from national Federation of Women
New Delhi where no local group has been Entrepreneurs.
formed yet.
15
 There was a reason for the separation.
We felt that since we were a part of a larg-
er organization, we were unable to work
independently on certain issues which are
very important to women. After so many
years in existence, FIWE did not even
have its own offices or permanent staff.
But we still work together with FISME.
Now that FIWE is a separate organiza-
tion, its principal goal is to foster the eco-
nomic empowerment of women by help-
ing them to become successful entrepre-
shops, beauty parlors, printing facilities to
steel manufacture.
ERT: How important is it for women’s
business associations to play an advocacy
role before government bodies, both legisla-
tive and executive?
MRS. AGGARWAL: This point was
recognized sometime in 1993. Everyone
felt we are working successfully on a local
basis, but that we had no say at the

The main objective for FIWE

is to interact with national
government policymakers so that
they understand the needs
of women entrepreneurs.

neurs. Another objective is to bring wo-
men business persons together to voice
their needs and demands in such a way
that government enacts policies beneficial
to their interests.
ERT: What types of members does FIWE
have now?
MRS. AGGARWAL: Our membership
is varied. FIWE as a whole has approxi-
mately 10,000 members coming from the
17 local associations that are affiliated
with it. (Their membership in turn varies
anywhere from 350 to 2,000 members.)
Small-scale entrepreneurs account for
approximately 60% of our combined
membership, large ones represent 15%,
and cottage and micro entrepreneurs
comprise the remainder. They work in a
wide gamut of sectors, from tailoring
national government policy level. Now
the main objective for FIWE is to interact
with national government policymakers
so that they understand the needs of
women entrepreneurs, and these needs
are at the grassroots level.
I wouldn’t claim that we have achieved
major changes on this front thus far. But I
feel that as we continue to work we’ll be
able to bring about some of them, possi-
bly by 1998. Given that we have more
membership applications and more of
our programs have been useful to individ-
uals and local groups, the government
will have to realize that women entrepre-
neurs must be involved at the policy level.
There has been some progress. At a
recent OECD meeting, I was pleased to
report that, with the help of the Finance
Ministry, FIWE was able to get women
entrepreneurs on the boards of all of

16 NUMBER TWO 1997 ECONOMIC REFORM TODAY

India’s major financial institutions, gov-
ernment agencies, purchasing organiza-
tions, and corporations. As a result, in the
future the needs and requirements of
women-owned businesses are more likely
to be taken into consideration. Of course,
due to the fast political changes India has
witnessed in the last two years we’ve expe-
rienced some loss of continuity. However,
I feel that if we follow up persistently we
will achieve other objectives by next year.
ERT: How do you see FIWE’s mission
developing in the future? What role would
you like to see the organization play over
the next five to ten years?
MRS. AGGARWAL: I would like FIWE
to become a stronger organization which
can work on all important issues related
to women entrepreneurs. Interaction with
policymakers should occur on a regular
basis, so that at any point in time they are
aware of our organization and the inter-
ests it represents. They should really con-
sider the viewpoints of our association
when making any kind of policy affecting
women entrepreneurs. I think the ap-
proach we are taking will support this
kind of advocacy.
Our leadership is very keen to
strengthen FIWE. The 20 members of the
Executive Committee, our principal gov-
erning body, are in constant touch with
each other and regularly contact and
write to national ministers about key
issues of concern to our members. We
also have a steering committee which
basically functions as the New Delhi
chapter, and it focuses on helping to solve
the problems that our members face in
that city.
ERT: How big an issue is financing for
women entrepreneurs? How do you effec-
tively channel women entrepreneurs into
mainstream financing channels?
MRS. AGGARWAL: The government
has granted several concessions that bene-
fit women entrepreneurs. For example,
the Small Industries Development Bank
of India and state-level government banks
ECONOMIC REFORM TODAY NUMBER TWO 1997
now require that women entrepreneurs
raise a smaller percentage of the capital
they need. If a man is starting a business,
he has to have a funding ratio of 1 to 3;
that is, he must put up one rupee for
every three he obtains from the banks.
But in the case of women, they must put
up just 10% and can obtain financing for
the remaining 90%. The only limitation is
that this kind of credit can be given only
to very small businesses. Still, this is a very
positive change.
There are two major problems that
need to be resolved. First, the commercial
banks have failed to provide concession-
ary interest rates to women-owned busi-
nesses. The government defines such
businesses as those in which women hold
at least 51% of the equity and 51% of all
the jobs.
The second issue is that the Bank of
India and the government have defined
small-scale enterprises as those having a
capital of up to 10 million rupees.
Associations should interact with policymakers frequently.
Because 10 million rupees is much
more than the capital of most small
enterprises, most of the commercial bank
credit continues to go to the larger com-
panies in this range. We have tried to
bring this point to their attention.
However, since changes only occur gradu-
17
 ally we are allowing some time for the
government to formulate new directives
on this issue to banks and other financial
institutions.
On the other hand, the government is
not inclined at all to give any kind of con-
cession to women in medium and large
scale businesses. The general negative atti-
tude which used to exist is, however, less
apparent now because many women who
As long as
the objectives
of international
women’s
associations are
the same, we
should work
together and
really become
more effective
together.
have come into medium and large com-
panies have automatically become part of
the mainstream. In other words, they are
being treated as industrialists, not as
women entrepreneurs per se.
While women in medium and large
industries have no problem obtaining
commercial credit, cottage, micro and
small-scale enterprises are really facing a
lot of problems. Women in these sectors
are having a hard time to get access to
credit. For this reason, since the OECD
forum on women entrepreneurs earlier
this year, we have decided that a key pri-
ority for FIWE in the near future is to
work more with commercial banks to
18
devise special credit programs for small
women business owners.
ERT: Does that keep them from being
able to do business or do they find other
channels to get funding?
MRS. AGGARWAL: Thus far they
don’t really have many financing channels
available. In fact, two of the new pro-
grams we are thinking about for our
organization are to start a business center
for the promotion of women-owned
businesses and to establish a bank for wo-
men. The Secretary of Small-scale Indus-
try, the Secretary of Women and Child
Development, and the secretaries of other
departments are all very keen on our
organization establishing such a banking
program. It is possible we will undertake
it, but right now I feel that it is too early
for us to do it. Maybe after five or six
months, we will be in a better position to
consider it.
There are other ways in which FIWE
can help women entrepreneurs. Every
bank in India has failed to promote entre-
preneurship among women. Through our
organization, we can help bridge the gap.
For women entrepreneurs who cannot
approach the banks directly, we try to
work like a bridge for them.
ERT: Are you able to determine which
women have good business plans and are
the best candidates to apply to the banks for
loans?
MRS. AGGARWAL: I find that out of
fifty women who approach us, only fif-
teen are genuinely interested in starting a
business. The rest of them are simply
forced by their husbands to go forward in
order to get some benefits from the gov-
ernment. But if we see a woman entrepre-
neur who really knows what she is talking
about—and that it’s not just that her hus-
band wants her to go into business—we’ll
do what we can to help her request a loan.
Initially we were making mistakes by for-
warding every application to the banks,
and the banks would say many of the
applicants were not genuine entrepre-
NUMBER TWO 1997 ECONOMIC REFORM TODAY
neurs. As a result, we now have become
strict about making sure that we assist
only those women who are genuinely
interested in establishing a business.
When we have a finance-related meet-
ing or workshop we invite bankers to be
both speakers and participants. Credit
financing is the main subject of almost
90% of our seminars, so the inclusion of
bankers increases their awareness of the
problems facing women entrepreneurs,
and they in turn can establish personal
contacts with the bankers. It is also im-
portant that FIWE has been able to estab-
lish a good record with all the banks.
ERT: Once you’ve made a match be-
tween a bank and an entrepreneur, does the
entrepreneur become responsible directly to
the bank for payments and for any other
credit issues that arise?
MRS. AGGARWAL: Yes. Once the loan
is approved, the entrepreneur deals di-
rectly with the bank. However, the banks
do report to us informally on how the
borrowers we presented to them are
doing. I have seen that 99% of women are
very conscientious about their credit
obligations, and they have been very regu-
lar in repaying them. Maybe one percent
of the women face some problem such as
a temporary financial crunch and then
have to make some kind of new repay-
ment arrangement with the bank. But
most of the enterprises have no problem.
ERT: Is there a role for international
organizations in promoting the interests of
women business owners worldwide?
MRS. AGGARWAL: As our organiza-
tion realized that globalization has really
become an undeniable reality, we thought
that it was time that we came together
and started working on it. We already had
the India-Pakistan joint business council
of women entrepreneurs and we were also
interacting with Indonesia and other
countries. So we decided to form an inter-
national federation. The presidents of the
national associations of eight countries—
Pakistan, Nigeria, Indonesia, Malaysia, In-
dia, China, Korea and Australia—founded
this international federation called the In-
ternational Federation of Women Entre-
preneurs (IFWE).
The sixth international conference of
IFWE is coming up soon in Accra, Ghana.
This is very important because these con-
ferences are the only opportunities in
which we can get to know what is hap-
pening outside our countries. IFWE has
really played a very important role in the
internationalization of women entrepre-
neurship, and I feel that this effort is
spreading its wings now that Africa has
become a part of it and Japan has come
forward as well. As long as our objectives
are the same, we should come together,
we should work together, and we should
really become more effective together.

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