India's social sector funding trends highlighted in the ‘India Philanthropy Report 2025’ | Current Affairs | Vision IAS
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India's social sector funding trends highlighted in the ‘India Philanthropy Report 2025’

Posted 01 Mar 2025

2 min read

According to report, social sector spending in India stands at 6–7% of GDP annually, combining public and private contributions. 

Key Highlights of Report

  • India’s social sector funding: Reached around ₹25 lakh crore in FY24 with 13% CAGR over last five years. It is projected to reach ₹ 45 lakh crore in FY29.
    • Rising economy, Indian diaspora and structural reforms are key factors behind this growth.
  • Key concerns:
    • Low private contribution: With only 5% of the total spending.
      • Private sector contributions came largely from family philanthropy from high-net-worth individuals (HNIs), and CSR. E.g. Heritage Project (2018) by Radha Goenka, Pride Fund (2025) by Godrej industries.
    • Funding Gap: Fund flow into India’s social sector fell short of NITI Aayog’s recommendation for 2023-24 by about ₹14 lakh crore.
      • NITI Aayog recommends social sector funding to be 13% of GDP. 

Significance of philanthropy as a development tool in India

  • Bridging Funding Gaps: Supplement critical budgetary support given by governments.
  • Addressing Development Gaps: Such as poverty alleviation, education, and healthcare access.
    • E.g. Azim Premji Foundation enhances rural public education.
  • Catalyzing Innovation: Tech-driven initiatives like digital literacy programs/healthcare startups.
    • E.gBill & Melinda Gates Foundation focus on sanitation innovations aligning with Swachh Bharat Mission.

Key Initiatives Promoting Social Sector Funding by Private Sector

  • Corporate Social Responsibility (CSR): Companies Act of 2013 mandates companies to allocate 2% of their average net profits to CSR activities.
  • India Philanthropy Alliance (IPA): A network of leading nonprofit organizations to advance India's development agenda.
  • Social Stock Exchange (SSE) in India: Dedicated platform on the stock market, where social enterprises raise capital from public.
  • Tags :
  • Social Sector
  • Philanthropy
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