Defining a context-free grammar for $\{w \in \{0, 1\}^* : \#_0(w) = \#_1(w)\}$
Your grammar does work. And you are correct in assuming that induction is a worthwile proof-technique. As a hint, you can use the following induction hypothesis:

IH: All the words of length at most $n$ that can be derived from $S$ have an equal amount of $0$'s and $1$'s.

Can you fill in the anchor and step from here?



As D.W. pointed out, the above is only enough to prove that the grammar will not produce any wrong words, or $L(G) \subseteq L$. In order to complete the proof, you also need to show that $L \subseteq L(G)$, i.e. all the words in the language are generated by the grammar.

For this part you can try an induction with the hypothesis

IH: All the words of length at most $n$ that have an equal amount of $0$'s and $1$'s can be derived from $S$.

(Of course, you can combine these two inductions, but having them seperate may be easier to handle if you are unexperienced.)