To Give or Not to Give: Giving Patterns of Indians

Snigdha is a researcher, interested in knowledge industries & regional development, labor markets, and human development. She enjoys writing and has written several papers, including journal articles, book chapters, and policy briefs. She currently lives in Naperville with her husband and two children.

While browsing the web recently, I got interested in the World Giving Index reportpublished by the Charities Aid Foundation, which provided information on charitable giving patterns across the world through a survey conducted by Gallup. The survey covered 153 countries and provided ranking of the countries based on how charitable they were. I eagerly turned the pages to see how India ranked. To my dismay and somewhat disbelief, India ranked a dismal 134 out of the 153 countries surveyed. Other South Asian countries, including Pakistan, Bangladesh, and Nepal were upwards of 100in ranking. Interestingly, Sri Lanka was the only South Asian country to rank within thetop ten – it ranked 8th.

Is India one of the least charitable nations in the world? To answer the question, let’s first look at what the survey means by “charitable behavior.” In order to gauge the giving patterns of countries, the survey relied on three indicators of charity: donations made to organizations (the list includes places of worship, registered charities, and community organizations); time volunteered at an organization, and helping a stranger who needed help. The survey revealed that only 14 percent of Indians donated money to charities, 12 percent volunteered time at a charity, while a higher percentage (30 percent) helped a stranger. To put it in perspective with another South Asian neighbor, in Sri Lanka, 58 percent donated money to a charity, 52 percent volunteered time, and 50 percent helped a stranger. The survey indicated that for many regions, helping a stranger is the most

common way in which people “give.”

India has had a long tradition of charity and giving. All major religions in India –Hinduism, Islam, Sikhism, Christianity, Jainism, and Buddhism – tout charity as a key for an honorable life. Many times, we do it even without realizing it – think how many times you’ve left a rupee/dollar or two at temples, offered alms to people in need, or helped out a far-out relative? We may disagree about the rationale or the effectiveness of such giving, but cannot argue that this indeed is giving! I believe Indians are generous and we easily open our hearts and homes to guests and do not waver to help family and friends.

So why does India lag in the global ranking of giving countries?

To begin with, I see a bias in the survey design. Although Gallup has obviously designed a representative sample survey, the report focuses on individuals in urban centers. I am not certain how the survey defines urban centers, what are the cut-offs for urban areasetc., but the fact that rural areas and probably smaller towns have been unaccounted for introduces a bias in the survey. In India, we’re talking about a vast majority of the population, about 70%, which lives in more than 550,000 villages. Although, I am notaware of any studies that have looked at differences in giving patterns in cities and villages in India, I would strongly suspect the percentage of people helping strangers to go up significantly if villages and smaller towns of India are included in the survey.

Another study conducted by Bain & Company entitled “An Overview of Philanthropy in India,” indicates that giving does not necessarily rise with income and wealth. In fact, according to the study, the wealthiest class in India has the lowest level of giving at 1.6 percent of household income, compared to 2.1 percent for the next wealthiest and educated class, and 1.9% for the middle class. The survey may also have misreported the donations made by Indians if the class patterns were not accounted for in the representative sample.

Despite the shortcomings of survey design, I am certain there are other cultural and structural shortcomings that affect giving patterns of Indians. For instance, according to the Bain & Company report, a large percentage of giving to charitable organizations is done by governments and foreign aid. In fact, in India, only 10 percent of charitable giving comes from individuals and corporations. This is probably the result of a socialist pattern of governance, where the government assumes responsibility for providing many basic necessities, like education and health, or emergency needs, like disaster relief.

Despite the emergence of many non-governmental organizations (NGOs) and decentralization of governance for social and development work (think growing powers of village panchayats), we’re very quick to blame the government for problems and there is a lack of motivation for self-help. Moreover, according to Bain & company, charity giving in India is also inhibited by the “relatively recent accumulation of wealth.” Since the disposable income of many Indians started trending upwards recently with the liberalization reforms set in motion in 1991, many are not willing to part with their hard-earned, newly-minted wealth. This is especially true for individual donors and corporate philanthropists (the latter is a topic better left for another discussion!). Finally, there is a good deal of cynicism in donors when it comes to the effectiveness or even intent ofcharitable organizations to provide services to communities. For instance, there are over 2million charity organizations (including NGOs), many of which do not have the transparency in their processes to generate confidence in donors. All these factors inhibit charity giving.

On a positive note, the Indian diaspora is a significant contributor to giving back to the country. India ranks highest in worldwide remittances, receiving $24.5 billion in 2007.

According to the Reserve Bank of India, North America is the largest source of remittances to India, followed by the Gulf region and Europe. However, most of the diaspora giving tends to be through informal channels and mostly at the family and community level. It is not surprising that India leads in worldwide remittances as the diaspora has deep attachments to communities of origin and non-resident Indians have continued to give back to their families, friends, and communities. Most of us have or know of people who have generously contributed within the clan or community to help out with marriage expenses or health crises. So the question arises, what is considered giving? If you help out a family member (near or extended family) in need, should that beconsidered charity? More importantly, is it enough? In the recent past, the diaspora giving has witnessed a structural shift with many now contributing for more social and developmental causes and through more formal channels, to organizations such as Asha and CRY and also to educational institutions. This seems to be a step in the right direction with giving shifting from ad hoc charity to more purposeful and effective giving.

Finally, I cannot overemphasize the ease of giving in a country like to U.S., where charitable organizations run very successful marketing campaigns in magazines, TV, and the radio, which legitimizes these organizations in the eyes of potential donors and they offer ease of donating. Think how many times you have received donation requests in the mail from organizations, such as Oxfam, St. Jude’s, Children’s International, even your public broadcasting station or your local museum. All it takes is writing up a check in the name of the organization for a cause you hold close to your heart with and mailing it back.

Despite the positives, such as diaspora and informal giving, and limitations of the survey, there is no denying that the World Giving Index has unfurled serious shortcomings in the way we give, or not! Whether it is the economic insecurities that have made individual donors and corporate philanthropists reluctant to part with their wealth in any significant way, the undue reliance on government to solve problems around us, or the ineffective marketing by charitable organizations, the bottom line is that we have not bought into the idea of purposeful giving as a way to address many of the woes that plague us as a society. I still maintain that Indians are generous; however, that generosity is primarily dictated by demands of religion, family, caste, and clan. Although, there is nothing wrong with that per se, we as a nation need to step above and beyond that to more purposeful giving for causes close to our hearts, such as rural development, women’s empowerment,education, and social reforms.

We have a strong precedent before us – the earliest acts of volunteerism and giving forsocial and economic development, for instance, were generated by the Gandhian philosophy of self-empowerment, which sparked the self-sufficiency movement in India, generated gramudyogs or village-based enterprises. There is no dearth of reasons to be more proactive in our communities. Just think of the dismal state of primary education in villages and the hunger for better education, think of the 456 millions who live below the poverty line, think of the state of health services for people who cannot afford to pay the costs of good health care, and think of children who stop you at traffic intersections to sell knick-knacks.

 

1 According to the Census of India, the urban centers are classified as follows: metropolitan areas are urban agglomerations with population of 1 million or more (there were 24 in 1991); cities are urban areas with population of more than 100,000; towns are urban areas with population of less than 100,000. As of 1991, there were 299 urban agglomerations with population of more than 100,000.

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