India has made rapid strides in economic growth, but how can the country maintain healthy GDP growth while addressing inequality among its citizens?
Over 60% of the Indian population still lives on less than $2 (about ₹ 130 at current rates) a day. In the World Economic Forum’s Inclusive Growth and Development Report 2015, India is placed second highest in terms of net income inequality among 34 countries in the lower-middle-income group.
India has made rapid strides in economic growth, but how can the country maintain healthy gross domestic product (GDP) growth while addressing the inequality among its citizens? This will demand structural changes and investment in growth-spurring areas such as human capital, but also the ensuring of equality of opportunities to its citizens—access to basic nutrition, education, energy, finance and job and entrepreneurship opportunities.
Social entrepreneurs are a key stakeholder segment to engage in delivering such basic services and opportunities efficiently and effectively to the underserved in India. Every year, the Social Entrepreneur of the Year (SEOY) Awards organized by the Schwab Foundation and Jubilant Bhartia Foundation attracts hundreds of social entrepreneurs from all over the country. Some of them employ innovative, cost-efficient and often technology-enabled business models that deliver basic services to those who lack access. Others are working hard at removing barriers that prevent access.
These entrepreneurs are not only outstanding in the Indian context, but on a global level as well, as we at the Schwab Foundation and the World Economic Forum have seen confirmed time and again. Many of these organizations work at an impressive scale—serving millions of low-income households and transforming their quality of life. An example is Aravind Eye Care System in south India, which focuses on curing blindness among India’s poor. The hospital chain serves approximately 12,000-15,000 outpatient visits and 1,500 surgeries each day. Karuna Trust and its public-private partnership model serve over 2 million low-income clients by transforming government primary health centres into hubs of low-cost, high-quality healthcare delivery. Nidan has organized close to a million informal-economy workers across India into collectives and enterprises, secured their access to markets, technology and financial services and successfully influenced government policy on their social and economic inclusion.
However, when compared to the magnitude of the social challenges facing the country, their efforts fall short; their impact is often limited to select geographies. How can India build on the wonderful work by these pioneers for social change at a national scale? The answer may not be in identifying more innovations; it may instead be in faster replication and scaling up of social enterprise innovations that we know work.
This will demand investing in best practices and capacities, removing barriers to scale, implementing conducive policies and fostering collective action across sectors.
True public-private collaboration is key to make this happen. When designing and implementing policies, the government should draw on the knowledge and experience of social entrepreneurs, the ideas and dynamism of its youth and the capabilities of the corporate sector to plan and execute large scale projects.
India’s young people are critical agents for replicating social enterprise ideas throughout the country—with half of its population under 25 years of age, India has an unrivalled youth demographic.
Beyond their direct reach and impacts, social entrepreneurs represent a powerful idea, an idea that is relevant today more than ever before—that business can be a vehicle to create both economic value as well contribute to building a fair and equitable society. India’s corporate champions have an opportunity to deepen their corporate global citizenship by joining forces with the government and social entrepreneurs in scaling these innovations.
Delivering on India’s inclusive growth agenda calls for multi-pronged interventions. One of them needs to be cultivating and nurturing its innovative social enterprises through public-private cooperation.
Klaus Schwab is founder and executive chairman of the World Economic Forum.
Jubilant Bhartia Foundation is a not-for-profit organization established by the Jubilant Bhartia Group. The promoters of HT Media Ltd, which publishes the Hindustan Times and Mint, and Jubilant Bhartia Group are closely related. There are, however, no promoter crossholdings.