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e-VANI is published monthly and provides updates on VANI’s programmes and activities, news in the development/voluntary sector and useful resources to strengthen the capacity of development/voluntary organizations.
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Note from Harsh Jaitli, CEO, VANI

The Three Dimensions of Development Aid

The Indian Voluntary Sector is passing through a very interesting phase. Not only its relationships with other engines of development like private sector and government are being redefined but inflow and outflow of financial resources also need a new look. India along with Brazil, Mexico, China and South Africa has emerged as the major epicenter of economic development. Globally every one is talking about mergers, acquisitions, and industrial growth of India. Equally true is the rampant poverty and deprivation in India. The analysis of three India have been rightfully put forward by the country strategy paper of DFID. If today’s Indian growth is not analyzed from holistic perspective it can create confusion and illusion of being an emerging super-power. VANI has been a part of decade old debate on the nature and peculiarities of depleting International aid to India whereas no discussion ever takes place about the international aid going out of India. Through this note VANI has tried to raise issue of three dominating dimensions of development aid.

The first dimension is about changing trend of expenditure by Indian government for the development sector through Voluntary Organizations. The word ‘Grant’ has been replaced by fees, honorarium, contracts, etc. The plans and schemes are made and approved by the various government departments, and voluntary organizations are only engaged to perform specific function within that. The steps like Expression of Interest (EOI), Request for Proposals (RFP), have been introduced. The notices for tenders are published either on the websites or in the newspapers. Sometimes, the language for tenders for social development assignments is same as that of construction of roads or bridges. The voluntary organizations who have been habitual of soliciting financial support in the form of flexible grants, through proposals or concept notes find it difficult to adapt. This system which was started to introduce transparency and accountability in financial transactions is supposed to be applicable at every level of government functioning. There are basically three areas of concern of the voluntary sector. Firstly, this reduces the space for participation in deciding priority and operational details of the assignment. The implementing agency is only seen as the extended hand of the government to deliver the pre-designed task. Secondly, when the terms like fees, contracts, or tenders are used then they draw the attention of Income Tax Authorities to term them as business activities. Although, most of the organizations take up only those assignments which are in line with their mission, experience and expertise, but even then they find it difficult to defend their case with IT - assessing officer. Thirdly, many voluntary agencies find capacity deficit to fit their task in the new pre-designed and rigid framework. Traditionally, the voluntary organizations are trained to develop proposals on the basis of priorities decided by the local stakeholders and asking for flexible grants, but they find it difficult to prepare a professional document starting from EOI, log frames and reports as desired by the supporting agencies. This deficit has also led to the mushrooming of consultants. No doubt there is need to campaign against this new sub-contracting of development, but also equally important is to equip the small and medium sized organizations with the desired skills to face the challenge.

The second dimension is of resources available for development that has emerged from the departure of bilaterals from India and gradual reduction of development aid to India. The last decade has witnessed the departure of many bilterals from India and few of those who are left are contributing their substantial portion directly to government run programmes. Even the multi-laterals which are operating in India contribute their significant budget to the flagship programmes of the Indian government. The voluntary agencies are then engaged in these programmes by the government on above stated conditions of sub-contractor. This has reduced the space to solicit flexible grant to work on innovations or on questioning status quo. Being considered as an emerging economic power has led to the reduction of flow of foreign aid to India. Even though, the ground realities are contrary to the projection. Today, we have substantial number of people marginalized and deprived from basic needs of life. The big question today in front of voluntary agencies is to invent methods to raise financial resources for innovations and rights based interventions. Not only there is a need to conduct public awareness campaign within India to mobilize local funds, but also advocate for change in taxation regime to facilitate ‘donations’. Some of the voluntary agencies like Greenpeace, CRY, SCF and OXFAM have started raising localized funds from within India, but still we need to incorporate some changes in our taxation system to encourage incentivice donations. The gravity of deprivation is increasing day by day whereas the support to the marginalized is depleting; therefore new ways of generating funds within India is very important. In fact, Ministry of Overseas Indian Affairs has registered a trust to solicit funds from Non-Resident Indians for support to Indian voluntary organizations.

The third but important dimension is the development aid which is given by Indian government to other countries. Still India does not have any policy document for overseas development aid, where as quite substantial amount is given by India. There are three concerns which are expressed by the voluntary organizations. The vast experience which Indian Voluntary Organizations have gained through their diverse engagement in socio-economic development projects in India could be used in such international projects. Indian voluntary sector has also contributed in designing many innovative projects in India and also considerable knowledge around participatory approaches. This body of knowledge and experience could be beneficial for effective Indian aid abroad. Secondly, the provisions of current Indian Income tax Act also restricts Indian voluntary agencies to operate outside India. Many countries of the world want to learn from the flagship projects like NREGS, RTI, SSA, but there is very less scope for Indian voluntary organizations to contribute. Thirdly, there is need to have transparency and accountability in deciding the priorities in least developed countries. The major critique of Indian support is its unplanned nature. The Indian aid is given on case to case basis without any long term strategy which eventually fails to make any impact on the lives of receiving country.

VANI INITIATIVES @ Jun and July, 2010


The Finance Ministry has come out with the revised discussion paper of the Direct Taxes Code (DTC) which can be seen as the revised DTC. The analysis of the code shows that the key and major concerns of the sector still remain unchanged. If the proposed DTC is enacted, then the NPO sector will be very adversely impacted. To discuss these issues further VANI organised a small meeting on 24th June, 2010 at NFI, New Delhi. On the basis of discussions held in the meeting as well as based on analysis of financial experts VANI has prepared the following documents. The representation was sent to the Finance Minister: More...

11-12th July 2010 :Promoting Good Governance in Civil Society Organisations at Mass Education, Kolkata

A two day regional workshop on “Promoting Good governance in Civil Society Organizations” was held in Kolkata on 11-12 July 2010. The workshop was organized by Voluntary Action Network India in association with Mass Education, Kolkata. The main aim of the workshop was to enhance common understanding among the participants on issues of legitimacy, transparency and accountability, hence leading to the creation of an environment for promoting of good governance practices among the Civil Society Organisations (CSOs).About 45 representatives of near about 25 CSOs from the states of West Bengal, Bihar, Jharkhand, Orissa, and Chattisgarh participated in the workshop. More...


Coming up…..

  • Meeting on Challenges faced by the Voluntary sector, 5th August 2010 in New delhi.

  • State Meeting in Maharashtra on 27th August.

  • CIVICUS world Assembly in Montreal ( 20-23 August, 2010 )

  • Bangkok Meeting (Platform HD2010: Towards a People’s Multilateralism in Asia and the Pacific), 30-31 August , 2010.

Announcements :

  1. Training on women leadership development for women staff members working with development organizations

    Duration : Ten days (22nd July to 31st July 2010)

    (This training is organized by Sahbhagi Shiksha Kendra with special 15 days session on gender sensitization by Breakthrough, New Delhi) More...

  1. Masters Programme on Participatory Development – A PRIA & IGNOU Collaboration : More...

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Resources :

Member of the Month:

COVA-Confederation of Voluntary Association

Vision :Communal Harmony, Peace and Social Justice through sensitization of all sections of society and empowerment of marginalised and poor.

Mission: COVA aims to create secular platforms in the form of networks for localised needs of harmony and empowerment involving local people, CBOs, VOs, and institutions, cutting across communities and working on the principle of service to humanity; COVA endeavor

Dr. Mazher Hussain

COVA-Confederation of Voluntary Association

20-4-10, Near New Bus Stand, Charminar, Hyderabad
500 002

Tel: (0091) - 040-24572984, 24528318, 24528320,
Email: covanetwork@gmail.com, mazherhussain11@gmail.com

Website :www.covanetwork.org

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