Social Entrepreneur in India: “To be or not to be” (Part 1)
A social entrepreneur begins her journey with an aim to add meaning to her life. And is sure that this meaning cannot be achieved unless a lot many other lives are given meaning to.
One of the newest figures to emerge on the world stage in recent years is the social entrepreneur.
— Thomas L. Friedman
Social entrepreneurs are considered a new breed though there have been innumerable social workers whose efforts have had and continue to have significant impact— Nelson Mandela, Mother Teresa, Josephine Butler, Georgette Mulheir to name a few. But a social entrepreneur, on her part, essentially “combine(s) a business school brain with a social worker’s heart,” as Thomas Friedman sees it in all leading sociopreneurs. The journey requires that ideal combination of skill and intent which touches and empowers several others by means of an effective and scalable business model. To distinguish in plain words, a social worker would teach poor kids or even donate money to build a few schools with no expectation in return but a social entrepreneur will lead a revolution by empowering several underprivileged youth to become micro entrepreneurs who can setup schools in their respective villages — all of this in a planned business like fashion so the chances of failure are reduced to the least, and also possibly to earn money as well on the way.
The journey (of a social entrepreneur) requires that ideal combination of skill and intent which touches and empowers several others by means of an effective and scalable business model.
In my effort to understand how the same can be achieved in a country like India, I interacted with a few social enterprises from across sectors who, over the years, have been able to contribute to the lives of those at the lower end of the economic ladder — in particular, and society and environment in general. In this part of the series, we shall cover the space, or the need of social entrepreneurship in India; in Part 2 (Click her to read), we shall cover the investment and other fundraising opportunities for sociopreneurs; the efficacy of Indian laws and government schemes — do they encourage or discourage social entrepreneurship?; the attitude of people (towards social change) who you will need to join your team as you scale up your idea; and finally some enterprises you can learn from; all this to help you make a sound conclusion on whether ‘to be or not to be’ a social entrepreneur in India.
Understanding the Areas in Need
India is a country with 70% of its population categorised as rural. Government efforts have brought significant change in the number of “educated” youth since Independence. However, survey results of Pratham’s Annual Status of Education Report 2017 (ASER 2017), released on January 15, 2018 found that amongst rural educated youths, aged between 14 and 18 years, about 25% cannot read basic text, and more than 50% struggle with simple division. To be precise, we are talking about 85 million of them. That’s where the concern lies. “The problem in India is not primarily employment, but employability. We need to add a top layer to the existing education in our institutions.” shares Ramkumar, founder, UniGlow — a social enterprise aimed at making our youth not just employment-ready, but entrepreneurship-ready through their engagement with educational institutions, corporates and government bodies. Otherwise, as we proceed further into the next 3–5 years when “education and technical competency will rule, we lie at a risk of isolating a large part of our population,” adds Raman Saluja, founder, Gramco, who understands the rural community well having supported famers since 2009 — providing the infrastructure their community desperately needs as support.
Analysed in the period between 1990 and 2015, the Lancet report titled ‘Global Burden of Disease’ ranked India at 154 in the total of 195 countries for the quality of healthcare available, lagging behind countries like Nepal and even Bangladesh. India also slipped three places to rank 100 in the 2017 Global Hunger Index (GHI-2017) (which measures hunger not in terms of lack of food but lack of nutrition.)
Nine of India’s poorest states — home to 48% of India’s population — account for 70% of the country’s infant deaths, 75% of under-five deaths and 62% of maternal deaths. Though the government has put efforts to setup hospitals and local clinics in rural areas, till the infrastructural requirements are taken care of, we will need to find several Florence Nightingales to take care of the the poor’s health, feels Raman Saluja. The National Health Policy 2017 of the government declares that it aims to bridge the gaps by increasing public spending to 2.5 percent of GDP by 2025 (from current 1.4%). However, like Raman believes, we will need an equal focus on infrastructure of the village clusters and tehsils to improve the quality of life of the rural populace and make quality healthcare accessible to the last mile.
It will be surprising for you to know that over 800 million people (almost 65% of India’s population) in India depend on farming for their livelihood, but agriculture makes up just around 14 percent of the nation’s total economic output. Farmers suffer from lack of education and exposure to best practices — be it related directly to farming or selling. According to the Dalwai Committee report (2018), the average monthly salary of a farmer in India stands at INR 6500/-. The result is the widespread phenomenon of farmer suicide in our country (with a farmer ending his life every 41 minutes)
Raman shares his perspective of the industry, “With over 550 million metric ton production, the industry stays so fragmented that there’s not a single company that captures 5% of the market. Agriculture needs serious investment. But VCs want to fund only technology powered innovations. However, the last man standing in our case i.e. the farmer will never be an app user.” He also disapproves of the government’s recent Agriculture Grand Challenge which is intended to support agri-tech startups in 12 areas. “We are always living in silos and a few people assume that these 12 areas will bring a magic pill. But creativity straddles a lot more. So we need more creativity and guts for glory,” he shares.
Ramkumar has similar thoughts for the sector: “the agriculture industry needs educated people — just like they are present in the field of Medicine and Science — if we are to see a revolution.”
State governments have time and again relieved farmers of their debt but that is not the solution. Farmers need to be empowered in order to be able to pay off their debts themselves.
- Clean Water and Sanitation
When it comes to provision of clean water and sanitation facilities, the inequality in access for urban and rural population is acute. 90% of urban residents have sanitation facilities compared to only 39% in rural areas. As a result, 44% of our total population of 1.3 billion still continue to defecate in the open. But this sector has seen significant support from the government which, since the launch of Swachh Bharat Mission, has constructed over 12 million toilets in rural areas. It is investing further in resources to end open defecation by 2019 under the same mission.
The sector has also seen support from social enterprises like Banka Bioloo which goes a step further to provide human waste management systems to population where conventional toilet facilities cannot be made available due to lack of infrastructure. “Social development in our country is laggard. To contribute our part, we have employed 300+ people to achieve our goal on the P-P-P model, with focus on livelihood, environment as well as profitability,” shares Sanjay Banka, Director, Banka Bioloo.
As a widely supported sentiment, a lot needs to be done in order to provide livelihood to the ever bourgeoning (rural) population of this country. One of the most successful schemes pushed by government to promote livelihood — MNREGA, in a short span of ten years did help generate 20 billion person-days of employment benefitting 276 million workers from which more than half were women. But even that number has been plummeting. From up to almost 60 days per household in 2009–10, the numbers plummeted to 30–40 days per household in 2014–15. And the number is only declining.
A Your Story article very broadly covers 6 areas that a sociopreneur can look into with an intent of generating livelihood for this section of our society. But generating livelihood might not be sufficient. We need those enterprises that look at creating micro entrepreneurs within the rural villages who can further the cause of generating livelihood for several others and hence set a chain reaction. Maneet Gohil, founder, Lal10 has been able to impact 9054 artisans. His enterprise makes artisans self sufficient with the help of designers who guide them on how to make products that can be sold more in volume and at higher margins. They also help them market their products to bulk buyers. But he feels a lot more needs to be done: “There are a total of 9.1 million artisans in India — almost 42% of the artisan population of the world but they contribute only 2% to the overall revenue generated by the global community. A lot needs to be done to create value for these undervalued talented artisans.”
- Financial Inclusion
Financial Inclusion as a sector has seen tremendous growth. The state of the things are changing well. Government’s Pradhan Mantri Jan Dhan Yojana (PMJDY) — the world’s largest financial inclusion scheme has seen great penetration into that segment of the society which continued to live on the edges of the formal economy for years.
“The number of bank accounts in India more than doubled, from just over 12 crore in January 2015 to 30 crore in August 2017. Even more encouraging, the number of zero balance accounts — bank accounts that have no money or transactions through them — fell from about 77 percent in September 2014, in the initial days of the PMJDY, to just over 20 percent in August this year(2017),” states a recent Times of India report. Though we still have 60 million people without bank accounts.
But it’s not just about everyone having bank accounts. Micro financing facilities also need to see a rise if the underprivileged is to be benefitted and included into the economy. “Concerted efforts are needed to deepen access to formal credit,” states a Livemint report. “Coverage through protection-linked insurance and pension schemes also needs to be ratcheted up significantly,” it adds.
The government, on its part needs to be proactive in order for social enterprises to be able to support its mission. Varun Sheth, Founder, Ketto, one of India’s leading crowdfunding platforms feels “it is sad, that in a country like India where social justice, equity and environmental protection are heavily flawed due to many issues, still social enterprises which aim in solving various issues are not legally recognized. For instance, three years after first examining how it can regulate crowdfunding, the Securities and Exchange Board of India (SEBI) is yet to finalize norms for this funding channel.”
- Clean Energy
Well, today we are consuming 8x the electricity compared to what we used in 1970s. But we are also using our climate much better and responsibly. World Bank doesn’t hesitate to acknowledge that India is emerging as a front runner in the global fight against climate change. We are currently allocating 17% of our electricity needs to renewable sources which is to rise to 50% in next 10 years.
Government’s UJALA program, through which the country has distributed more than 241 million LED bulbs has helped save more than 6,000 MW of energy and resulted in a 25-million ton reduction in CO2 emissions per year. India plans to replace all of its 770 million incandescent bulbs with LEDs by 2019.
To achieve these goals, the government is also looking to spur manufacturing of solar equipments within India and is looking at imposing an import duty of 30% on the same products which gives a large opportunity and motivation to India based manufacturers.
But we cannot rely on government to play the game solely for the whole country. Kevin Houston, founder, Carbon Masters believes that “the huge social problems in India today cannot and will not be solved by Government alone, or by the philanthropic or CSR efforts of India’s corporate sector ,well intentioned as those are. Only by encouraging , nurturing and funding a willing army of young social impact entrepreneurs with the right quantum and quality of support will those “ problems” be turned into “ opportunities “ and thousands of new high growth, mission driven, high impact businesses be brought into being and the lives of millions of Indians be transformed .” Carbon Masters is a global carbon management consultancy which also manufactures Carbon Lites, a renewable natural gas (80 to 90% methane) made by the capture, purification and bottling of biogas emanating from the anaerobic digestion of agricultural waste at its plant in Bangalore, India.
In Part 2 (Click here), we discuss the investment and other fundraising opportunities for sociopreneurs; the efficacy of Indian laws and government support; the attitude of people (towards social change) who you will need to join your team as you scale up your idea; some enterprises you can learn from; and finally a few facts to help you make a sound conclusion on whether ‘to be or not to be’ a social entrepreneur.
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