It is an established fact that the foreign funding is coming down in India. Raising concerns of a large number of NPOs, particularly the ones relying on such funding, on how they could continue with their activities. SRRF has always believed that there is a need for the Sector to start generating resources from within the country. SRRF, alongwith Deepalaya, held a week-long training programme last year on how to enhance resource mobilization by Sponsorship Programmes. SRRF continues to believe that there is tremendous scope for individual giving in India.
This belief has been supported through a report entitled ‘India Philanthropy Report 2011’ brought out by Bain & Company. The report comes out with some revealing facts. It also perhaps is an indicator for NPOs on which way lies the future path for resource generation. This is so apt during this Joy of Giving week. Some excerpts from the report are highlighted.
Till 2006 total giving was only around 0.6% of GDP, of which only 1/3rd came from individuals & corporate, i.e. only 0.2% of GDP. Rest was mainly from foreign funding. However the report states that in 2010 private funding from corporate and individuals has risen to 0.3-0.4% of GDP. Of this 26% share is from individuals only. A dramatic increase over earlier years.
Future potential for giving by individuals can be gauged from the fact that in US which raises around $ 304 billion (2.2% of GDP) in private charity, 81% is mainly from individuals. In UK which raises around $ 29 billion (1.3% of GDP), 75% is from individuals and corporates. Brazil raises around $ 5 billion (0.3% of GDP). China raised around $ 11 billion (being 0.2% of GDP), 86% being from individuals & corporate. In India private donations were around $ 5-6 billion (being 0.3-0.4% of GDP). GDP wise India’s contribution from corporate and individuals was higher than that of Brazil or even China.
What gives hope for raising resources in India from individuals is that ‘High Net Worth Individuals’ in India are rising at a much higher rate than any of the other economy anywhere – more than 50% between 2008 & 2009. Contributions by Indian individuals come to around 1.5-3% of individuals’ annual income, compared to around 9% in US.
Major reasons cited as obstacles for raising the resources are lack of Transparency & Accountability in the NPOs and unfriendly tax laws for donations. However it is believed that contributions from Individuals will rise significantly in years to come and NPOs which prepare themselves now for these challenges will do well (or perhaps survive).
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