India's mega rich lag far behind West in philanthropy
Despite having 55 dollar-billionaires, philanthropy in India lags the West as donors seek to grasp the impact of charity before opening wallets
They may build skyscraper mansions, travel by private jet and throw sumptuous wedding parties, but it seems India's super-rich are much slower at opening their wallets for charity.
India now has 55 dollar-billionaires, the fifth-biggest number in the world, according to a Forbes ranking this month.
But like other emerging economies such as China, its charitable giving still lags markedly behind that in the West where the tradition of wealthy businessmen donating chunks of their fortunes is much more deeply ingrained.
Wealthy Indians gave up an average 3.1 per cent of their income to charitable causes in 2011 - up from 2010 but far behind the 9.1 per cent average in America, according to global consultancy Bain & Company.
But analysts say the upturn in giving as more Indians get seriously rich is going very slowly.
"The pace for corporate India and especially the new rich giving up its wealth is excruciatingly slow," said Manjeet Kripalani, executive director at Gateway House, a Mumbai-based think tank. "Corporate philanthropy needs to look at a thoughtful way of scaling up giving," she said.
While impressive growth in the past decade has created a swathe of Indian tycoons, the more recent economic slowdown has compounded the slow take-up of philanthropy, despite a pressing need to tackle widespread poverty.
"Giving is impacted by sentiment, which remains weak at the moment. It is likely to be flat or extremely moderate in terms of growth," said Arpan Sheth, author of Bain's annual Indian study.
The latest report released this month did not give fresh statistics, but said donors were "putting a higher bar on understanding the impact of their giving, before they commit to causes" in the tough business environment.
India's richest man Mukesh Ambani, the chief of Reliance Industries, has criticised Western corporate charity as a "disempowering tool" that "increases dependency".
India does not lack a culture of giving. Reliance has followed the lead of large industrial groups such as Tata and Aditya Birla, which donate heavily to charity through their own trusts, with projects ranging from health care to rural infrastructure.
Azim Premji, chief of software giant Wipro, last month gave US$2.3 billion from his own pocket to the education charity he controls, and he is now considered "Asia's most generous man" by Forbes.
But the scale of Premji's donation has renewed the debate on why India's richest are not giving away more of their wealth.
One explanation from businessmen, said Economic Times journalist Anand Mahadevan, was that wealth creation remained a recent phenomenon in India compared with richer countries, and philanthropy usually comes further down the road.
Also, Indian charity often took a more informal form: people might donate to local schools or hospitals in kind, or "give money, hair, gold, to our temples as charity", said Kripalani.
India currently ranks a lowly 133rd out of 146 countries in the latest World Giving Index - down from 91st position in 2011 - based on surveys of charitable behaviour around the globe.
Analysts say a major barrier to giving is not knowing whether donations will produce sustainable results.
Manas Ratha, director of the non-profit Dasra group, said willing philanthropists were there but "a lot of work needs to be done. There is good reason to be optimistic, but we are losing time and opportunity".