Reaching the Bottom of the Pyramid
India is a study of contrasts — a story of three Indias in one.
The Global India often is in the news. The famed IT and other manufacturing industries, the global offshore businesses, an economic growth rate of 9 percent, and its emergence as a growing global investor speak volumes of its presence on the world stage. The emergence of billionaires — four Indians in the top 10 in the world — sums it up. India is just amazing.
The Developing India of farmers, and small and medium enterprises, constitutes the huge middle class. And then there is the Poor India of the marginalized farmers; of migrant construction labour living in extreme poverty; where half the children are still malnourished; where more than 300 million people — roughly the size of the U.S. population — are living on less than ONE DOLLAR a day; where women usually are the worst off; and where there are unequal opportunities for millions. It’s a story where 1 million women die every year due to poor health care, and 50 million children fail to attend school. Government plans have done a lot, but problems are of gigantic proportions.
Without the emancipation of this section of Indian society, the UN Millennium Development Goals will never be achieved. And this is the section of society that NGOs are addressing. Every NGO says it can do much more, but for want of funds. Resource mobilization in India is in its infancy; there are no professional fundraisers.
Isn’t it ironic that this situation persists when there are plenty of resources around? There is an urgent need to build our fundraising, but we have not invested enough.
The money is there
In India, the NGO sector raises just $600 million a year from a population of more than 1.1 billion. Of this, half goes to the extended family and villages, a quarter to religious institutions, and the balance to NGOs. India’s fundraising market is perhaps one of the most underdeveloped in the world. But even with this meagre amount, the organizations have done a commendable job.
In terms of total numbers of comfortable and even quite wealthy people, we in India are not that far behind. India has changed. Our economy is growing and is one of the world’s biggest. There are Indians, millions and millions of them, who could quite easily be donors.
In fact, we might have a larger number of people who can give than in any other country. Recent wealth research reports indicate that India now has more than 1 million people earning more than $2.5 million a year, and the number reeling in more than $1 million a year is too big to be counted. Not to mention our billionaires. Nonresident Indians (NRIs) alone send more than $23 billion as remittances. In spite of such potential, major-gift fundraising is almost absent.
Are we less compassionate than other countries or less generous? I don’t think so. We just haven’t been asked properly. The oldest cliché in charitable fundraising is, “You don’t get if you don’t ask.” And India today is almost a virgin territory for fundraising.
This enormous resource is there, and we are tapping a mere fraction of it. Why? There’s a simple reason. There are almost no professional fundraisers in India. We have few or no professional trainers, and we do not invest in our fundraising as the senior management does not understand it. In other countries, billions of dollars are accessed by fully trained professional fundraisers. These countries have invested, and the wisdom of this investment is apparent.
When will India catch up?
Have we prepared our society to access resources and built up their capacities? Sadly, we have not. The problem is we are trying to give people fish instead of teaching them how to fish. We’ve made our NGOs dependent. INGOs still bring in well more than $1 billion each year, but not even a tiny fraction of 1 percent is used to build up this critical and vital ability.
NGOs desire to be sustainable. They need to become professional, transparent, accountable and self-reliant. But how can we do this?
There are more than 1 million NGOs in India. And, according to the Indian Professional Fundraising Association, only 1 percent has a fundraiser. Most rely on handouts and have no fundraising plan, no self-sustaining revenue model and no fundraising strategies. So, the potential remains untapped.
Despite growth in India’s economy, sadly our giving market is not growing. There is an urgent need to recruit and train fundraisers to enable them to interact with potential donors to get funds directly and manage money with high efficiency. This is a challenging professional activity requiring considerable skills and commitment.
To put it simply, we in India need to support the development of an effective fundraising profession. The South Asian Fundraising Group, of which I am chairman, is an Indian NGO capable of creating, guiding and building this capacity. We are passionate about this and have a plan which, when implemented, can move NGOs toward self-sufficiency. But if we are to realise the potential, we have to do it quickly.
India urgently needs a leapfrog strategy. This prompted SAFRG to create a new strategy to recruit and prepare more than 2,000 fundraisers in the next three years. This is possible at a nominal cost of about $2 million over four years.
In four to five years time, the fundraisers trained will be capable of raising more than $150 million per year and increasing this year to year. The sector then will be able to address effectively most issues, including poverty, and establish fundraising as a “career.” Can we afford to delay this? Only at our peril.
Do we have philanthropists? Yes, we do, but nothing compared to what we see in the West. Many content themselves with small projects, and only a few take on strategic interventions. We need the likes of Warren Buffett, George Soros or Bill Clinton, who can egg them on to do greater things. We need to encourage and stimulate the many billionaires to take on strategic interventions. There may be no better solution than this to combat poverty and the many other major issues that face society in India. FS