EXPLORING THE NON PROFIT SECTOR IN INDIA SOME GLIMPSES FROM MAHARASHTRA Prepared by PRIA & Society for Socio-Economic Studies and Services in Collaboration with the Center for Civil Society Studies. .J ohns Hopkins University. USA September 2003 Working Paper Number 10 Society for Participatory Research ill Asia (PNIA) 42, Tughlakabad Institutional Area New Delhi - If() 062 Plume : (9/-0/1) 2995 6908,29958508,2606093//32/33 Fax : (91-()II ) 2995 5/83 Email: [email protected] Website: www.pria.org ' 0 TE TS Preface II - III All Executive Summary IV I. The Context I - 2 n. Socio-Economic and Political Scenario 3 - 5 III. Historical Background 6 - 14 IV Th e Legal Framework 15 - 22 V. The Survey Instruments 23 - 33 VI. The Survey Results 34 - 51 VD. Lessons Learnt for Future Surveys 52 - 53 Annex I 5-1-55 Anne: II 5() References 57 Members olThe . d\ i~I)(") 'onuniucc 5X PR IA Research ·' cam IIOr K INS Core Teal11 PREF CE The Society for Participatory Research in Asia (PRIA) had been engaged, since late 1998, in a rather voluminous exercise on mapping the nonprofit sector in India. Th e exercise aimed at generating systematically as much of the information as was feasible about the sector, which included the size, scope, areas o f interest, sources of revenue, expenditure patterns, etc . The study was carried out at the behest of the Center for Ci vil Society Studies (CC SS) at the Johns Hopkins University (JHU ) in the United States, with the fond hope that the information generated would help in developing a better understanding of the role these organisations play in social and economic develop ment processes of the country. The data on the are being analysed in phases and a series of working papers are being prepared, under the overall guidance of an Adv isory Committee, for wider dissemination of the project output. T he pre se nt paper is the tenth in the series. During the first year of the project, the PR IA research team had undertaken an exhaustive review of the secondary sources of data, which included an examination of the em ployment data generated by the National Sample Survey Organisation (NSSO) , the national accounts statistics , and the Economic Census; the latter two brought out by the Central Statistical Organisation (CSO). It was found that the official stat istics system had, de - facto, not recognized, at least till 1998, the non-profit sector as a separate ly identifiable entity. Sporadic attempts to collect information on the sector were utterly inadequate, since the term 'non ­ profit' had not been even defined in some cases. Indirect estimates of the number of such institutions and employment there - in could perhaps be derived from so me of the official data, hut their authenticity would be any body' s guess, since the estimates will have to be based on several assumptions. More importantly. even such an exercise could not give clue on a large number of parameters of serious interest to the sector's planning need s such as the size of the informal sector and activ ities of groups engaged in sub-sectors e.g. community services and environment. In this background, the question of collecting primary data through sample surveys co uld not be eschewed. The organisational surveys of non - profit institutions have never been attem pted before in India. Therefore, the work is truly pioneering. As it happens with all p ioneering efforts, there is bound to be scope for improvements in the approach and the methodologies used for implementing the adopted approach. It is commo n knowledge that the NGO leaders as II well the government plann ers make statements on vanous dimensions of the sector and the sector 's ca pabi lities based on their perceptions. The reason for this is not difficult to comprehend; there is an utter lack of scientifically developed literature on the subject. It is hoped that the present re port is con sidered as pro viding more authentic information than available hitherto, whic h can honestly be treated as benchmark estimates in various debates. We are grateful to the Institute for Policy Studies. John s Hopkins University in Baltimore, for inv iting PRIA to undertake the Study in India. We gratefully acknowledge continuous guidance of the core project team at the JHU and that of the Indian Ad visory Co mmittee. The overall leadership to the study has been ably provided by Dr. S. S. Srivastava, Principal Researcher. The field work, for the main survey (s), was undertaken by Vaikunthbhai Mehta Research Ce ntre, Mumbai and computer processing of the collected pri mary data, their tabulation and analyses were undertaken by the Society for Socio-econom ic Studies and Services (SSESS), a Kol kata based organisation. Th e SSESS also und ertook ably the task of preparing the draft report, unde r the guidance of Shri S. K. Gu pta, its Director. The JBU, the Ford Foundation (New Delhi), the Aga Khan Foundation, the Action Aid and Sir Ratan Tata Tru st have supported the Study. Dr. Rajesh Tand on President, PRIA Se ptember 2003 111 A EXECUTI E ~ 'UI\'I RY The overall picture of non pro fit sector that emerges from the survey is as follows :­ • It is estimated that there were about R8 thousand act ive NPOs in the year [999-2000; About 60% of the NPOs were in rural areas and the remaining 40% in urban areas; • About 77 % of the total NPOs were registered formal units and the rem aining 23% were unregistered informal units; • The total manpower engaged in the sector worked out at approximately I0.8 lakhs ( l . m~ million) persons, comprising overwhelmingly part -time unp aid vol unteers (8.2Ia khs) . Full-time volunteers were few (about 43 thousand) and Paid em ployees were of the order of 2.2 Iakhs, mostly full-time; • Religious org anizations (35%), followed by Co mmu nity and Soc ial Wel fare Services(30%) and Educational Insti tutions ( 14%). do minate the Maharastra NPO scene; • Community as a whole (34.71'0),children ( 18.5%), youth ( 16.2%), in that order, were found 10 be the main target groups on which the NPOs of Mah arastra focussed their attention and energies; • Total funds received by the sec tor in the yea r 1999-2000 wa s estima ted at Rs.10.55billions (Rs. 1,055 crores); • The total foreign contri butions received during J 99\)-2000 amounted to about Rs.305.2 millions (2.89% of the total fund s received); • Estimated lotal expenditures by NPOs in 1999-2000 was of the order ofRs. 10.13 billions; • Estimate d total value of assets in 1999-2000 was about Rs.50. 64 billio ns. Th e sector's heterogeneity is vis ible both in terms of paid employ ment and vol ume of expenditure. There is pre-dominance ofsmaller units, about 74 % of total NPOs with none or one paid employee. Almost 80% of NPOs do not have an annual budget of even Rs.50,OOO. I V EXPLORING THE NON PRom SECTOR IN INDIA Some Glimpses from Maharashtra I. THE CONTE 'T No n-G o vern me nt and non -profit d istributing organisations ha ve be en making significa nt contribution towards social and economic development in Indi a. These Institutions are known by d ifferent na mes in the co untry namel y: Voluntary an d Com munity based Organi sations, Self-help g roups, Soc iet ies , Association s. C lubs etc. depen di ng on the areas of ac tiv ities they are involve d in . Despite a rapid g ro w th in their numbe rs and area of operations , particularly d uri ng the pos t- ind -pendence period, very little informati o n seems to be av ailab le re lating to the s tructure of this se ct or, its c urre nt contributio n to the national ec o no my and capabilities to play an important ro le in soc ia l and econ omic de velopment of the co untry. A similar phen ome non is be ing w itnessed almost across the globe. As far back as In 1990, the Johns Hopkins University (JHU) la unc hed a Co mparative No n-Prof it Secto r Proj ect (C N PS) with the objectiv es o f delineating the definitio nal boundaries of the sector and to develop s ystematica lly as mu ch of the informatio n base abo ut the sec tor as wa s feasible. Initi ally the projec t was undertake n in eight developed co untries vi z. France, Germany, Hungary. Italy. Japan, the U.K. and the U.S. A . Gradu a lly, less de ve lo ped count ries we re al so roped in and by the ye ar 1995, so me 22 countries had been bro ugh t w ith in the ambit of the projec t. India jo ine d the project in 1998. The Society fo r Participatory Research in Asia (PRIA) at the behest of the Center for Civil Society Studies (CCSS) at the JHU in the United S tates. ha s launched the project in Ind ia in tw o parts, an e mpirical part e nv isaging building up statistica l base to measure the ke y d imensio ns o f the secto r and a no n-e m pi rica l part envi sagmg an understanding of the interplay between stake holders, discussio ns on how to ev olve polic ies for the se ctor and related q uestio ns.