Working together: the importance of trust


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‘The key benefits of a collaborative are to mitigate individual risk, be greater than the sum of its individual parts, and to enable ideas and missions to scale.’

– Rohini Nilekani,

Founder-Chairperson, Arghyam

AS Rohini Nilekani said, collaborations help create much larger impact. We have seen examples of successful collaborations between the state and capital, with the help of NGOs. These three pillars in our lives – Sarkar, Bazaar and Samaj (government, corporates and civil society) – need to collaborate and innovate together to improve our lives and reduce absolute poverty. However, most collaborations are not that successful. This article addresses the need for partnerships, the barriers to successful partnerships, regulations that are impacting NGOs and examples of some successful collaborations.

More recently, Anil Swarup, author and former Education Secretary, wrote, ‘As we all understand, efficiencies will come from the private domain and scale from the public domain. Hence, it is imperative for them to come together. It can be done because it has to be done.’ That is not entirely true because we have seen private sector scale in the IT, telecom and aviation sectors in India. But for someone from the government to say so, highlights the argument for a larger role for the private sector in India’s development.

Quite often the credit for success or the blame for failure depends on either the structure of the collaboration or the people involved. Not all players in these three pillars operate professionally. It is not always the fault of the sarkar, nor of the bazaar, nor of the samaj. And often, instead of penalizing the bad player, all players get penalized. This explains the recent announcements, for example, that make it more difficult for NGOs to operate. Those that do not file their reports on time or work with mala fide intentions should be penalised, but why penalise those that are doing a good job?

During the Covid-19 crisis we have seen how samaj and bazaar stepped in to help sarkar handle so many challenges that the sarkar could not handle on its own – food distribution, migration, housing, clothing, hospital care, etc. Various ministers and officials have thanked the NGOs for playing a huge role in the Covid relief efforts and the government systems would have collapsed without this help. We hope that the events of the past few months help to rebuild the trust gap between the sarkar and the bazaar and samaj and that steps will be announced to improve the ease of doing business (EODB) in the non-profit sector. As Noshir Dadrawala, CEO, Centre for Advancement of Philanthropy, wrote, ‘It is rather unfortunate, therefore, that the government seems to perceive the corporate sector as enhancing the country’s economic growth and the voluntary sector as fomenting dissent and thwarting development.’


One disturbing trend that has happened over the past few months is of corporate donating significant amounts to central and state government funds for disaster relief, and backing out of commitments made to NGOs. It is good to see bazaar coming forward to support sarkar in such a crisis, but it would have been so much better if they had not cut down their commitments to samaj. Many NGOs could shut down permanently, causing huge problems to their staff and beneficiaries. These staff members have no safety nets and may not qualify for government schemes. Also, with the huge focus on Covid relief, many fabulous initiatives in other sectors like health, education, skilling, and sanitation are being severely hit. It would be wrong for society if the sarkar and bazaar let the third pillar, samaj, collapse.

The engagement of bazaar in the social sector accelerated after the government announced a set of voluntary guidelines in 2009. That document carried a lot of very useful suggestions on how corporates could be more socially responsible. Unfortunately, a lot of those guidelines got dropped and the 2013 Companies Act only focused on the 2% CSR contribution. This led to bazaar working more closely with samaj. The Covid crisis has seen a significant part of these funds getting diverted from samaj to sarkar. Hopefully, this is not a permanent diversion.

This article will explore the benefits of partnerships, some of the recent government announcements that adversely impact NGOs, barriers to partnerships and some successful partnerships.


The Bridgespan Report, Philanthropic Collaboratives in India: The Power of Many, outlines three goals of philanthropic collaboratives that serve also for government and NGO partnerships. First, scale solutions: The challenges in India are immense and we need solutions that can impact a large part of the population. It is not possible for any one pillar to be able to do this on its own. We have been reducing poverty, for example, for over 70 years, but there is still a large part of our population living in abject poverty. China has been able to reduce the number of people in abject poverty significantly over the past 40 years. The mid-day meal programme of the government has been one measure that has had a huge impact on improving both school enrolment and child nutrition.

One successful partnership that has played a role in this is Akshaya Patra, an NGO set up in 2000. In partnership with the Government of India, various state governments and many corporate and individual donors, it serves about 1.8 million children daily, through 52 kitchens in 12 states and 2 union territories. Another successful project that succeeded, thanks to the collaboration between sarkar, bazaar and samaj, was the launch of Aadhaar, the unique identification number for all residents of India. The government conceived the project, brought in Nandan Nilekani from the private sector to set it up (and he, in turn, brought in some of the leading private sector companies as vendors) and leveraged civil society networks to mobilize residents to enrol.

Second, build or strengthen a field: By leveraging the collective strength of samaj, sarkar and bazaar, collaboratives can scale the impact of an entire field, instead of just a couple of areas. On the demand side, they can create public awareness and fund demonstration projects. On the supply side, they can help deliver better service. On the enabling environment side, they help improve policies and regulations. In this manner the scope can go beyond specific geographies. Examples of some partnerships are the Indian Sanitation Coalition and India Climate Collaborative.

Three, build a case for promising innovations: Bill Gates talks about how innovations for the poor suffer from some market limitations. At the same time governments may not have the capacity to fund innovation whose impacts are unclear and long dated or to back a series of innovations that are likely to fail. This is where ‘catalytic philanthropy can harness political and market forces to get those innovations to the people who need them the most.’ A large number of innovations currently being worked on to find treatments for Covid-19 are collaborations between bazaar, sarkar and samaj.


Currently the samaj sector is going through a lot of pain. The economic situation and the huge amount of funding that is going to Covid relief work has severely impacted donor flows to the sector. Many NGOs, like many small and big businesses, may not be able to survive past 2021.

Over the past year a lot of steps have been announced by the government that further impact the EODB of NGOs. This is in sharp contrast to the various measures taken to improve the EODB in the corporate sector. There are so many regulators for the NGO sector – based on how the NGO is set up; it deals with the Charity Commissioner (for trusts), the Registrar of Societies (for societies), or the Registrar of Companies (for Section 8 companies). It also has to deal with the Income Tax Authority for approval to operate as a charitable organisation, and the Ministry of Home Affairs if it wants to get funds from overseas.


Some of the recent measures that add to these challenges are listed below:

1. Tax exemption (Section 12 AA) and tax deduction (Section 80G) will be valid only for five years and need to be renewed every five years. A few years ago the government had decided that such approvals were permanent, until taken back. The current rule adds uncertainty to the planning process on an NGO and the work that they do in their communities. In addition, all NGOs had to compulsorily renew their 12AA and 80G exemptions in 2020, irrespective of when it was approved.

2. Section 8 companies will qualify as CSR implementing agencies, and not trusts and societies. Historically, most NGOs have been set up as trusts or societies. This proposal would not allow them to access CSR money. After the COVID outbreak, the central government set up the ‘Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) as a public charitable trust and allowed CSR money to be donated to it. Hopefully, this proposal will not be implemented, since the government has also set up a trust to collect CSR money.

3. Under an amendment of the Foreign Contribution (Regulation) Act (FCRA) 2010, every board member must submit a declaration and affidavit that she/he is not involved in activities which are anti-national, including activities like religious conversions. Earlier the Foreign Contribution Regulation Rules 2015 brought in a renewal process every five years, which was not required under FCRA 1976 and FCRA 2010.

4. If a charitable trust or institution’s 12AA approval is cancelled, the assets (including land and buildings) of the trust or institution would also be taxed. This adds another layer of stress to the NGO.

5. The Income Tax Department may cancel the 12AA approval if the trust or organisation loses its registration under any other law (including FCRA).

In order to help the samaj sector continue its excellent work, it is advisable for the government to not implement these measures and help strengthen the sector. The government has the right to regulate NGOs, but is should not make regulatory compliance so expensive and onerous that good NGOs get penalised unjustly.


I have written about the benefits of partnerships. However, not many partnerships survive or are able to meet their objectives. There are various reasons that cause a partnership to either not start or die soon. Some of these are listed below:

First, lack of trust. It is important for both sides to trust each other. If there is a trust deficit, it becomes difficult to work together for an extended period of time. One will invariably doubt the intention of the other party and this leads to a waste of time and resources. I used to be on the board of a public-private partnership in the aviation sector, and it was frustrating to see how lack of trust created unnecessary trouble and resulted in a significant loss of value for the entity.

The 2015 ‘Report of the Committee on Revisiting and Revitalising Public Private Partnership Model of Infrastructure’, chaired by Vijay Kelkar, said that the success of PPPs ‘will depend on a change in attitude and in the mindset of all authorities dealing with PPPs, including public agencies partnering with the private sector, government departments supervising PPPs, and auditing and legislative institutions providing oversight of PPPs.’ The report goes on to elaborate what this change in attitude means: (a) a move from ‘transaction’ to ‘relationship’ and service delivery for citizens; (b) a ‘give and take’ approach is needed; and (c) we need to develop a mechanism for dealing with uncertainties in long-dated contracts. Every decision cannot be treated upfront as mala fide. This report also urges all parties to foster trust when implementing PPPs.


Second, poor design: In the eagerness to close out a partnership, parties do not spend enough time working out the details. Incentives are often not aligned properly. Matters like clarity on goals, roles and responsibilities get ignored in the hurry to meet deadlines for signing MOUs and that has resulted in many partnerships with various state and central governments being still-born at the time of signing the MOU because not enough thought was put into designing the partnership.

Gary Becker, the Nobel Prize winning economist from the University of Chicago, did a lot of research on incentives and whenever I would discuss a problem with an outcome, he would drill it down to misaligned incentives. For example, the NGO may be driven by the ability to raise more funds and pay higher salaries, whereas the government may be interested only in outcomes. Or the government may be interested in showing larger numbers, whereas the NGO may be interested in actual impact. That is why new academic institutions, like the Indian School of Public Policy, focus on the design and management of institutions and rules that govern society.

Three, ego: It is unfortunate that egos play a large role in destroying partnerships. And I have seen this on both sides, quite often with the NGO founders. A few years ago, I was at a meeting where the company brought together three NGOs, that they had funded in the education sector, to explore how they could partner with the government in having impact much great than what they were individually achieving. The founders never met again because they could not agree on a common strategy.


Four, an inability to agree on course corrections: It is unreasonable to expect partners to allocate risks precisely when drawing up a contract. When unexpected events take place one of the partners may find it unviable to continue. I have seen many such situations during my infrastructure career. In the NGO sector it is even more critical when the NGO partner just does not have the funding flexibility to continue when they do not get paid by the government or costs go up unexpectedly. This is when contracts need to be renegotiated and the 2015 Kelkar report talks about the need to address this appropriately.

Five, an inability to find a champion for the cause: It is important that any collaboration has a champion within all three pillars – sarkar, bazaar and samaj. Otherwise there is no alignment of incentives and the concerned organization may not have the drive to push for the collaboration, especially when challenges surface. When I started the India Development Fund (the original name for IDFC Private Equity) we struggled until we found a champion in the Ministry of Finance who saw the value in what we were attempting to do, and helped clear obstacles for us.

Six, transparency/improper approval processes: It is also important for both parties, especially with the government agency, that the proper procedures be followed. Otherwise one runs the risk that the partnership could be challenged later, impacting the proper functioning. I was involved in such a public-private partnership many years ago with a railway company that got derailed because the CEO had his own personal agenda that was not supported by his board. PM CARES has been very successful in raising a large amount of CSR money for Covid relief work. We hope that this fund will adopt high levels of transparency and be a catalyst for helping those in need and to find solutions to treat the virus.

Seven, ignoring the grassroots: A big challenge with centrally run projects is that they are sometimes designed by people stuck far away in their ivory towers. Solutions that involve the average citizen need to get inputs from the citizens at the grassroots level. Over the years I have learnt that it is sheer arrogance to believe that people at the bottom of the pyramid do not know what is good for them. They behave as rationally, or as irrationally, as people at the top. And it is easier to work together at the grassroots level than at senior levels. Arun Maira recently wrote, ‘Good coalitions at the top are hard to form because the partners are divided by invisible walls… the world needs local solutions to solve global systemic problems.’


Despite these challenges, there have been successful collaborations between the three pillars of sarkar, bazaar and samaj. I have listed a few.

1. The Collaborators for Transforming Education. This collaboration was put together in 2016 to improve language and math learning in Maharashtra. EdelGive Foundation put this together with seven donors. Two NGOs – Gyan Prakash Foundation and Kaivalya Education Foundation – engaged with 1,044 government functionaries and trained headmasters on how to coach teachers and analyse data on students’ performances. These, in turn, worked with 45,000 teachers to elevate classroom performance. They use the ‘Learning Navigator – GPAS for Learning’, the technology app pf Gooru, another NGO. Overall learning outcomes went up 14% in the four districts that the collaboration worked in.

Some of the reasons for being successful are developing solutions based on a common agreed end goal, bringing in different players based on their skills to achieve the end goal and the trust that developed between them, using the Learning Navigator to measure real time progress and keeping the child at the centre of whatever they do.

2. Bhavishya Alliance: This collaboration was put together in 2006 to reduce the problem of malnutrition among children in Maharashtra. It lasted for six years. It involved funders, government agencies, international organizations and leading business (including TCS and HDFC) and NGOs (including BAIF and SNEHA). Eleven innovative pilot projects were rolled out. One of these pilots was to help women become literate in 30 backward communities in Nashik using technology. Sixty three per cent of these women achieved financial literacy and 23% completed the health and nutrition one-year programme.

The reasons for the success include investing time to build trust at the beginning and throughout the project, seeking an enabling environment for innovation, use pilots to test the prototypes, ensure that the key people stay throughout the programme, identify and foster government commitment, ensure genuine involvement of the communities and NGOs, identify the appropriate corporate partners, avoid taking on the role of the government and engaging people in a meaningful manner.

3. Right To Pee Campaign: This collaboration of 33 community based organisations and women’s self-help groups (including The Urban Project, CORO and Yuvak Mitra Mandal) was started in 2011 to call attention to the lack of free, clean and safe public toilets for women in Mumbai. It now has multiple stakeholders, including the Municipal Corporation of Greater Mumbai (MCGM/BMC), The Urban Project, donors (UN Women, UNICEF and Cigna) and many communities and individuals.

What has made this collaboration successful is the clarity on what needs to be done and what should be let go, the proper collection of data and mapping, media advocacy and awareness campaigns, the filing of public interest litigations, bringing in the government as a partner and the focus on changing attitudes.

4. Axis Dil Se: Collaborations also work in remote parts of our country. This collaboration was put together in 2017 to look at transforming government schools in some of the most remote and inaccessible villages of India. The partners were Axis Bank, the Hill Councils of Leh and Kargil districts, 17000 Ft Foundation and the village communities. The project was for three years and implemented in 105 government schools. The aim was to increase enrolment, reduce migration, build community ownership and improve learnings through Ed Tech solutions (including in some villages with no electricity and connectivity). 6,500 students were reached, migration dropped by 50%, community participation doubled, learning outcomes improved and there is now a platform for officials to monitor these schools.

What made this collaboration successful was the collaborative nature of all parties, and clear role clarification. Deep trust between the partners and employee engagement by the corporate partner.


It is vital that sarkar, bazaar and samaj work closely together for India to have more inclusive development. The government has to admit that it doesn’t have the capacity to do it on its own and the corporate sector and civil society need to realize that in the current environment they need the government as a strong partner. We need to develop greater trust between the partners to make sure collaborations are well planned and managed, to ensure that India becomes a more prosperous nation. Celebrating successful collaborations and learning from them will also help create a trusting environment.


* The views expressed are personal.


Various newsletters of Centre for Advancement of Philanthropy.

Noshir Dadrawala, ‘A Partner for Nation-Building’, The Indian Express, 9 June 2020.

Tanya Jagtiani, ‘The Laws that Govern India’s Non-Profits, IDR Online, 22 January 2020.

Arun Maira, ‘Effective Coalitions form Bottom Up, Not Top Down’, IDR Online, 9 July 2020.

The Bridgespan Group, ‘Philanthropic Collaboratives in India: The Power of Many’, February 2020.

Department of Economic Affairs, Report of the Committee on Revisiting and Revitalising Public Private Partnership Model of Infrastructure, November 2015.

The Bhavishya Alliance – Legacy and Learnings from an Indian Multi-sector Partnership to Reduce Child Undernutrition, April 2012.

A Study on the Legal, Regulatory, and Grants-in-Aid System for India’s Voluntary Sector, Centre for Social Impact and Philanthropy, Ashoka University, February 2020.

The Partner Initiative, Challenging Trends in Business-NGO Relationships in India, 2011.

Luis Miranda, ‘How Trust Deficit has Invaded our Lives’, Forbes, February 2014.

Bill Gates, The Power of Catalytic Philanthropy, September 2012.