‘Feeding America’, one of the largest charities in the US, raised over $4 billion in 2022. In comparison, India’s largest similar organization supplying meals raised about $0.07 billion. However, rather than focusing on the comparison with a much larger economy and charity, it is important to consider the size of the need in India. Non-profits in India have the potential to achieve so much more and help accelerate the country’s progress towards the Sustainable Development Goals 2030 agenda, but there are several factors holding them back.
India has several million non-profit organizations, with estimates ranging from 1.75 lakh to 3 million registered NGOs. These organizations operate under different legal frameworks at the central and state levels, including societies, trusts, and Section 8 companies. However, there is no single government agency or regulator that governs and monitors the health of the sector. This lack of oversight leads to a lack of credible and updated data on the size, funding patterns, sectoral trends, and growth of the non-profit sector.
To address this gap, an attempt was made to map the top 200 non-profits in India based on their annual budget. This was done using the only objective and verified parameter available – the annual reports, which are signed by auditors and provide information on the organization’s size. The focus was on independent non-profits with their own mission statements, involved in implementation work, and raising funds from multiple sources. This excluded corporate CSR foundations, philanthropic/HNI/family foundations primarily serving as funding agencies, multi-lateral institutions, and large educational institutions and hospitals generating revenue through operations.
The survey of the top 200 non-profits in India revealed some important findings. These organizations have annual budgets ranging from Rs 10 crore to 800 crore and secure funding of about Rs 8,000-9,000 crore annually. The funding comes almost equally from domestic and foreign sources. Over the three years analyzed (2019-2022), the total pool of capital to these organizations did not change significantly. The top sectors these organizations work in include children, community development, education, healthcare, and livelihood. Approximately 18% of the organizations have a global origin or affiliation, and they received 30% of the total funding. At an aggregate level, the non-profits have a year-end income surplus ranging from 4% to 7% of the total money raised each year. Finances can be volatile, with almost 20% experiencing an income change of over 50% in 2021-2022. The headquarters of these large NGOs are concentrated in areas with corporate and commercial activity, highlighting the need for non-profits in underdeveloped areas capable of raising and deploying large grants for local development. It is also worth noting that most of the large non-profits today started in the last two decades, benefiting from factors such as the influx of professional talent, new philanthropists with different visions, changing regulatory environments, and evolving societal problems.
Beyond the top 200 non-profits, there are thousands of organizations doing good work, but they may not have significant size or scale. While their localized impact is still valuable, there is a need for organizations with demonstrated models of impact to scale up. This requires a regulatory and policy overhaul to support non-profits of all sizes, organization building with non-programmatic grants and capacity strengthening, and a focus on transparency to build trust.
Currently, India’s largest private sector company spends as much on social impact through Corporate Social Responsibility (CSR) as the largest non-profit in India funded by multiple donors. However, less than half of corporate India’s sizeable pool of mandatory CSR spend goes to independent non-profits. To achieve sustainable and inclusive growth as envisioned in SDG 2030, it is crucial for impact-focused non-profits to grow alongside the Indian economy and the private sector.
In conclusion, there is immense potential for non-profits in India to make a significant impact, but they face challenges in terms of regulation, funding, and transparency. Addressing these challenges through policy measures, philanthropic support, and capacity building can help non-profits reach their full potential and contribute to India’s progress towards the Sustainable Development Goals.
