India has significant distance to cover on almost all development fronts. Its ranking on global development indicators like the Human Development Index (HDI) and the SDG index hasn’t improved substantially in recent years. The country ranked 130 on the HDI in 2018, the same ranking as in 2014, and 112 on the SDG index in 2018, a two-point drop since the index was first published in 2016.
The extent of the issue is evident from the fact that India accounts for more than 20% of the absolute world performance gap in 10 of the 17 SDGs and more than 10% of the gap in another 6 of 17 SDGs (according to the Sustainable Development Solutions Network). Given India’s high contribution to the world performance gap, the country will play a critical role in the world’s ability to deliver on the SDGs by 2030.
The SDGs require sizable outlays, given the size of India’s population and the history of underfunding in social areas. Estimates suggest that India needs an average of approximately INR 26 lakh crore in annual funding to fulfil even five of the SDGs by 2030 (zero hunger, good health and well-being, quality education, gender equality, and clean water and sanitation).
Even in the most optimistic scenario—in which India sustains its current economic growth rate and its current funding growth rate, all philanthropic capital is channelled towards the SDGs, there is no leakage in deployment, and the funding required to meet the SDGs doesn’t increase—the nation will still face an annual funding gap of around INR 4.2 lakh crore.
Depending on how each of these factors evolve, the actual shortfall could be two to four times that amount. Therefore, it is critical that public social sector expenditure (central and state), the mainstay of the total funding, increases substantially, says the India Philanthropy Report 2019 by Bain & Co.
At the same time, increased contributions from private philanthropy are needed to supplement public spending in two ways. First, private philanthropy can be a catalyst to increase government spending and cover the funding shortfall the nation is experiencing. Second, private philanthropy can help ensure timely and effective fund deployment, with greater accountability and monitoring.
With a growing economy and rising wealth, the role of domestic private philanthropy becomes increasingly important, regardless of how foreign contributions evolve. Both domestic corporations and Indian UHNIs need to enhance the level and nature of their giving.