Power of giving fund starved sectors like science health education rural development need generous hnis

Power of giving fund starved sectors like science health education rural development need generous hnis

The immense possibilities for philanthropy are highlighted by the Rs 425 crore donation from the families of IT firm Mindtree’s co-founders Subroto Bagchi and NS Parthasarathy to Indian Institute of Science. IISc, which last year broke into the top 100 band in Times Higher Education’s Reputation Ranking of global universities, will set up medical facilities focussed on cutting-edge clinical research and innovation. Philanthropy in India is growing but the fund flows are too miniscule despite the country boasting many high net-worth individuals (HNIs).

Domestic HNIs funding local causes could help offset the squeeze applied by FCRA restrictions to global non-profit contributions to India and the pandemic’s severe blow to those in lower income brackets. The number of Indian billionaires rose to an estimated 142 in 2021, with only the US and China ahead. But a Harvard Kennedy School study of nearly 1.6 lakh foundations across 22 major countries revealed that 97% of foundation assets totalling $1.5 trillion are concentrated in the US and Europe. Not only are Indian foundations’ ranking abysmally low, their spend rate (expenditure versus assets) was a low 3% against 9% in the US and 37% in Spain.

The India Philanthropy Report 2021 by Bain and Dasra notes philanthropic funding in 2020 rose 23% to Rs 64,000 crore. While foreign contributions, CSR and retail donations have stagnated at 80% of inflows, family philanthropy accounted for most of this increase. An Edelweiss study predicting 4 lakh Indian HNI families by 2025 with assets totalling Rs 360 lakh crore against 1.5 lakh families with Rs 140 lakh crore assets in 2018, reveals high growth potential for family philanthropy. Mindtree founders are like other generous tech HNIs. The tech sector accounted for 26% of family philanthropy despite boasting only 9% of HNI families. With India’s public spending in areas like science and technology, health and education abysmally low in proportion to GDP compared to other countries, philanthropy can help bridge the gap. Will our HNIs step up?