In No Lax Mood
The nation hailed the election of
India’s new Prime Minister, Narendra Modi, in 2014. However, it wasn’t long till
the tremors started being felt in the non-profit sector. The new government beefed
up the powers of tax officials to withdraw tax exemption from non-government
organizations (NGOs), charitable institutions and trusts. There came a
startling crackdown on international NGOs, like Greenpeace, Amnesty and
ActionAid, in response to an Intelligence Bureau (IB) report that claimed that
foreign-funded activism against development projects was hurting the economic
growth by two to three percent annually.
Silver Lining
Over the years, while the sector
hasn’t seen a direct policy intervention positively, there are various
initiatives by the government that are bound to give the much-needed boost to
the sector. For instance, the Digital
India Initiative is aiming to provide internet connectivity to over 200,000
villages, making mobile connections and bank accounts available for digital and
financial inclusion to 42,300 villages, and dispersing digital literacy. This
will catapult the outreach for social entrepreneurs as rightly pointed out by Tom
Watson that the rise of social enterprises in America from the mid-90s to
present correlates almost perfectly with instant communications, access to vast
knowledge, and the sharing of data and applications by many millions of people
through open, freely-accessed yet commercially viable internet.
Further, the government of India has designed
a financing tool with the private sector to help social enterprises in
capacity-building by investing seed capital through a new fund called India Inclusive Innovation Fund (IIIF)
in areas of healthcare, energy, urban infrastructure, water and transportation.
The Corporate Social Responsibility law
has made it mandatory for organizations in India to contribute at least 2% of
their average net profit of last 3 years on CSR activities.
The government is listening to the
need of fresh ideas. Their initiatives like Make
in India, Digital India, Clean India, Skill India, 100 Smart Cities
and Startup India Standup India are
easing the process of setting up new ventures in the social space as well. What
is needed now is a directed policy framework with a clear agenda to make
financing accessible and accountability paramount for social enterprises in the
country.
Take a Cue
Here in USA, the Obama administration
proposed a $300 million Pay for Success Incentive Fund to catalyze initiatives
by state and local governments with federal matching money for programs that
improve outcomes for individuals and communities and also produce federal
budget savings. As Michele Jolin points out in ‘Innovating the White House’, governments need to focus less on
replicating individual programs and more on reorienting the government’s
relationship toward the nonprofit sector. This can be achieved with a mix of
policy tools directed towards greater
access to capital, better tools to assess
impact and tax structure
modification that encourages innovation in this sector. From the
perspective of a policy student and social entrepreneur from India, I am
hopeful that constructive amends are not far.
The burgeoning social sector with it’s sizeable outreach needs to be
partnered with and not shunned by the government, not only in India, but
globally.
References:
1. Indian
Government Planning to Select Activist NGOs for Scrutiny
2. Net
Neutrality And Social Entrepreneurship: Why Freedom To Create And Share Matters
3. The Future
Is Bright For Indian Social Enterprise - Here's Why
4. 2014 Impact
Investing Global Policy Report
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