Philanthropy In India

Posted on July 11, 2012 in Society

By Shashank Bhasker:

India is only a few years away from becoming ineligible to receive funds from the World Bank’s International Development Association — the bank’s fund for the poorest countries. In essence, India’s per capita income has risen above the maximum threshold to receive money from the IDA. This factor by itself is a great milestone as it shows that India has reached a point in its economic development where it is no longer considered one of the world’s most impoverished countries. Moreover, India will continue to have access to World Bank fund via another facility called the International Bank for Reconstruction and Development, who targets middle income countries. The primary difference between the IDA and IBRD is that the former relies much more heavily on grants and the latter on loans. India stands to lose over $2 billion in low-interest funds for many of its welfare schemes, besides missing out on social initiatives spearheaded by the Washington-based lender over the previous decade.

India continues to have the largest number of people living in poverty in the entire world. About 40% of the 1.2 billion people are below poverty line. India is currently classified as a “blend” country – defined as one in transition from lower middle-income to middle-income – and is creditworthy for lending from both IDA and IBRD. The finance ministry, which is lobbying with the bank, has argued that though per capita income has risen, India has the highest number of poor and should, therefore, continue to get IDA support. This forthcoming transition then begs the question over who will be able to fill the void that will be generated.

The adage “give a man a fish you feed him for a day; teach him how to fish you feed him for a lifetime” is at the heart of the difference between charity and philanthropy .Philanthropic funding in India is not only insufficient in overall monetary value but also in flowing to the people with the greatest need. There is a dire need to shift the philanthropic orientation from “giving back” to “solving problems”, considering a broader set of critical social issues. The problem is funding is seen to be short-term. Thus rectifying this problem is of prima donna status. Non-profits need to plan for long terms and raise funds with the motive to have a positive impact. Real social change takes time and one-off donations, or one-year funding means programs get started, but may not reach the momentum to bring about real social change. The fund raisers often ask the money to be allocated in program costs which include textbooks, building, medicines etc. But to have a greater impact the money needs to spent on the “unconventional”. This includes training of staff, a vision for growth, monitoring and evaluation etc. the philanthropic capital may move from traditional sectors to address a whole new set of challenges, such as water and sanitation and also issues related to renewable energy, maternal health and affordable housing. At this stage, if critical hurdles faced by donors, support networks and charities are addressed and resources are applied effectively, then maximum impact can be achieved for the most number of people. Thus in this way India can try and build a system to self-sustain once the funds from the World Bank stop.