World Bank approves USD 1.5 bn loan to support India's reforms, job creation

New Delhi: The World Bank's Board of Executive Directors has approved USD 1.5 billion in financing to support India's structural reforms aimed at boosting private sector-led job creation and accelerating economic growth.

The financing, provided under the Boosting Job Creation in the Private Sector Development Policy Financing (DPF) Operation, is expected to support reforms that can create employment opportunities for 11 million young Indians entering the workforce over the next two decades.

The programme builds on reforms undertaken in recent years, including tax simplification, trade integration, regulatory changes, and measures to improve the business environment, the World Bank said in a statement on Monday.


The DPF supports initiatives to reduce barriers to entrepreneurship, strengthen labour market participation, particularly among women, streamline trade and investment processes, and improve access to capital for businesses, it added.

In November 2025, the government consolidated 29 labour laws into four comprehensive Labour Codes, aimed at simplifying compliance, modernising outdated provisions, and creating a more efficient framework for businesses while protecting workers' rights.

According to government estimates, employment in India increased from 452 million in 2017-18 to 604 million in 2023-24, adding more than 150 million jobs over six years. During the same period, the unemployment rate declined from 6 per cent to 3.2 per cent, while nearly 9 million women joined regular wage employment.

The reforms reflect India's shift towards outcome-oriented governance focused on transparency, predictability, and long-term economic resilience, it said.

The operation is aligned with the World Bank Group's Country Partnership Framework for India for FY26-31 and supports the government's Viksit Bharat by 2047 vision by improving the environment for firms, encouraging private investment, and expanding productive employment opportunities, it said.

The programme will focus on three key areas - improving the business-enabling environment, promoting trade and investment openness, and mobilising private capital for business expansion and job creation, it noted.

"India is well paced in its reform agenda to unlock private capital and create jobs in a challenging global context," said World Bank Vice President for South Asia Johannes Zutt.

The DPF also complements recent investments by the World Bank Group's private sector arm, the International Finance Corporation (IFC), to increase credit access for MSMEs and underserved communities, including women in rural and semi-urban areas.