After two days of chaotic scenes in India's parliament, its upper house has overwhelmingly approved an historic bill that would reserve one third of seats in the national and state legislatures for women.

Manmohan Singh, the Prime Minister, described the passing of the Women's Reservation Bill as a "step forward toward emancipation of Indian womanhood". He said it was a historic occasion, which called for celebration.

Sonia Gandhi, the head of the ruling Congress Party who championed the Bill, said: "It is a very happy day for me personally. But it is not for me alone. It is actually my colleagues, the men, and, to start with, the Prime Minister and the members of my party – men and women."

The Bill will increase the number of women in the 545-seat national legislature – which currently has no gender quota – from 59 to at least 181 at the next general election.

It will also reserve a third of seats in all state assemblies for women, although it will not apply to the upper house of parliament.

The Bill, first introduced in 1996, was strongly opposed by small, regional socialist parties, who said it did not go far enough. They want seats reserved for ethnic minorities, Muslims and people from the lower levels of the Hindu caste system.

Two of them withdrew their support from the ruling coalition on Monday and blocked the upper house from debating the Bill by shouting slogans, tearing up copies of the legislation, and trying to grab the microphone from the speaker.

They forced it to adjourn again twice yesterday, before seven of their MPs were suspended and physically removed from the upper house.

The Bill is now expected to be taken to the lower house of parliament for voting next week. It also has to be approved by legislatures in 15 of India's 28 states and union territories before it becomes law.

It is widely expected to pass as the main opposition parties, including the Hindu nationalist Bharatiya Janata Party and communist groups, have already announced their support for the legislation.

After yesterday's vote, Mrs Gandhi was asked by reporters if she was confident in the stability of her Government.

"I think so. One can never tell," she responded, according to the Press Trust of India. "I am not an astrologer. I wish our former partners remained with us."

Rights activists have hailed the Bill as a breakthrough for Indian women, whose quality of life still lags behind their counterparts in East and South East Asia, and in many parts of Africa.

India introduced universal suffrage upon independence from Britain in 1947, and elected a woman Prime Minister – Indira Gandhi – in 1966.

Last year, it elected its first woman President, Pratibha Patil, and its first woman Speaker of Parliament, Meira Kumar.

Panchayats – the local governing bodies in towns and villages – already reserve almost 40 per cent of their seats for women.

But progress has been slow on improving rights and living standards for ordinary women in a country where traditional attitudes prevail in most of the countryside, and among the urban poor.

The World Economic Forum ranked India 114th out of 134 countries in a 2009 report on global gender disparities, with India posting low scores on female life expectancy, health and education.

The UN ranked India 134th out of 182 countries last year for female literacy, the proportion of women in its Cabinet – 10 per cent – and its gender development index, which measures disparity between living standards for men and women.

Almost all of the countries ranked lower by the UN were in sub-Saharan Africa.

Quotas for women in parliament have already been introduced in several other Asian countries, including Pakistan, Afghanistan and Bangladesh, as well as in Africa.