16 Diaspora, Development and Philanthropy

1. INTRODUCTION

Development has been a fundamental aspiration of humanity since times immemorial.. The word ‘development’ has been very powerfully impacting articulation in the political and economic discourses since the last four decades or so. It is still a contested and contextual concept. Development is a normative concept, traditionally synonymous with a host of concepts such as progress, improvement, poverty alleviation, social provisioning and enhancement of human well-being. Over the last two decades there has evolved a more expanded version of human development that includes measures like Human Development Index (HDI), Human Poverty Index (HPI) and Gender-related Development Index (GDI), concepts like Development as Capability Expansion, as Emancipation, as Environment Sustainability etc. However, the processes that lead to development in the social, cultural and economic fields is not very easy to grasp. The UNDP (1990: 9) defines the objective of development thus: “People are the real wealth of a nation. The basic objective of development is to create an enabling environment for people to live long, healthy and creative lives. This may appear to be a simple truth. But it is often forgotten in the immediate concern with the accumulation of commodities and financial wealth”. The development discourse and stemming from it, development policy has undergone considerable evolution and change over the decades from the earlier notion of ‘trickle down’ development.

1.1 Diaspora and Development

Development experiences vary with contexts, countries, stages of development etc. However, the most important aspect that is dominating the discourse in recent years is that the “ human beings” are the main drivers of development. The movement or migration of human beings has implications for development and underdevelopment of a particular nation or society. The United Nations Development Programme (UNDP) Report 2009 titled ‘Human Development on the Move’ emphasises the fact that migration and movement of the people bring socio-economic development to the home as well as to the host countries. Migrants, who often turn into diasporas, offer their skills, knowledge, acquire new skills, contribute to the home country in terms of investments, remittances, philanthropy, etc. Migrants are often considered as intellectual, emotional, economic and cultural resources for the country of origin. Development is a broad umbrella under which assistance comes from individuals, NGOs, governments from outside the country.

The emotional and cultural affinity of the diaspora to the homeland is very strong in the first generation. The pain of separation, the struggle in the new land, the longing and nostalgia for home are powerful motivators of the desire to contribute to the homeland. These sentiments will recede as successive generations pass. There are studies that show how the first generation differs from the second and third generations in terms of philanthropic engagement with the mother country. Geithner, Johnson and Chen (2004: xvi) found that the first generation usually donates to its own regional, linguistic or religious groups, while the second and third generation donors tend to give towards broader concerns i.e “national” needs of their country of origin. They also found that most of the second and third generations do not support philanthropic activities that are religious and identity oriented; rather they promote more sustainable and issue based social development. Diaspora’s contribution to development is a very well researched area today. Researchers (Kapur (2004), Johnson (2007), Newland (2010), Dhesi (2007), Thandi (2007) find various developmental engagements of diaspora in the home and host countries.

Contribution of a diaspora to development in its homeland has several dimensions. Four of the major modes of contribution are through FDI, Remittances, Advocacy and Philanthropy.We shall briefly consider the first three and then take a more detailed look at Diaspora philanthropy.

1.2 Foreign Direct Investment (FDI)

According to IMF and OECD definitions, direct investment reflects the aim of obtaining a lasting interest by a resident entity of one economy (direct investor) in an enterprise that is resident in another economy (the direct investment enterprise). The “lasting interest” implies the existence of a long-term relationship between the direct investor and the direct investment enterprise and a significant degree of influence on the management of the latter. Direct investment involves both the initial transaction establishing the relationship between the investor and the enterprise and all subsequent capital transactions between them and among affiliated enterprises, both incorporated and unincorporated. It should be noted that capital transactions which do not give rise to any settlement, e.g. an interchange of shares among affiliated companies, must also be recorded in the Balance of Payments and in the IIP.

Foreign Direct Investment (FDI) has been opposed in many countries because of its negative impact on the local economy. On the other hand, it is often seen as a form of globalising force that make a country competent in the new economic order.

FDI can be made by both diasporics and non-diasporics from abroad. They are an important source of development in the receiving country.

1.3 Diaspora Remittances

Remittances – the transfer of funds between individuals in different countries– represent an increasingly significant flow of capital to the developing world. Typically, they flow from diasporic individuals and communities in wealthy countries to family members and communities back home. Remittances are an essential source of external funds for developing countries. These flows were three times larger than official development assistance in 2013, and are steadier than both private debt and portfolio equity flows. Remittance flows are significantly larger than total foreign direct investment to developing countries, excluding China. They are also a more stable component of receipts in the current account, reliably bringing in foreign currency that helps sustain the balance of payments and dampen gyrations. A World Bank study estimated that the remittances to developing countries are projected to grow by 4.4 percent to US$454 billion in 2015 (World Bank: 2014: 1). In 2013, remittances were more than three times larger than Official Development Assistance (ODA) and, excluding China, significantly exceeded foreign direct investment flows to developing countries. Growth of remittances in 2014 is being led by three regions: East Asia and the Pacific, South Asia, and Latin America and the Caribbean. Flows of official financing administered with the promotion of the economic development and welfare of developing countries as the main objective, and which are concessional in character with a grant element of at least 25 percent (using a fixed 10 percent rate of discount).

India is the largest receiver of remittances in the world since last four to five years. In 2014 it received US $70 billion. States like Kerala, Maharashtra and Tamil Nadu have contributed nearly 60 per cent to the total inflows during the year 2013. Kerala remains the top recipient, contributing 33 per cent to the total remittances into the country, the World Bank data stated. The high rate of migration from Kerala to the Gulf region is the reason for this high proportion. The growing remittance is also due to the rising income levels coupled with a sharp fall in the rupee. The average quantum of money transferred to states like Kerala has increased from Rs 43,000-44,000 to Rs 46,000-47,000 per transaction, a sign of rising income levels of migrants from the region.

Remittances help in increased household consumption in health, education and family welfare and also contribute to human welfare and capital development at the community level. They also contribute to the construction of modern houses, the upgrading of farm production and the growth of income -generating small business enterprises. In some countries, remittances contribute to local development through the promotion of new small-scale enterprises in the non-farm sector, as was found in several countries including Egypt, (McCormick and Wahba,2003) and Mexico (Cornelius, 1990). A long term impact of remittances has been the creation of new community assets and services especially found in a number of countries in Africa and Asia, as in Latin America and the Caribbean region. Remittances are being used to build social assets and facilities such as schools, medical and community centres, roads and small irrigation projects.

Comparing remittances or private money transfers from non-resident Indians to FDIs, there is evidence that the former have been rising steadily between 2009 and 2012 despite a slowdown of the global economy and have become a more reliable source of funds for many Indian families compared with foreign direct investment (FDI).

Official data for the past three years show that while FDI inflows fluctuated and even dipped, inward remittances were upwardly mobile. In 2011 -12, NRI remittances were $66.13 billion (Rs. 3,42,884.05 crore), against an FDI inflow of $46.84 billion into the country. Inward remittances have been on an upswing over the past three years, unaffected by factors, such as a fragile global economy and boosted by a falling rupee, of late (Hindustan Times 8.10.2012).

1. 4 Diaspora Advocacy and Development

The value of advocacy is quite phenomenal in the recent times as a small group of articulate people or groups can often amplify their concern globally through various unconventional means. Technological advancement often made this possible to provide the platform to the communities live far away from the native country geographically. There are a large array of diaspora advocacy groups that are identity based, developmental, human rights and issue based etc for example human rights groups in Ethiopian diaspora, Chinese diaspora and democratic movement back home, Armenian diaspora etc.

Advocacy has impact on both home and host society. It is often controversial and political. Sikh protest across the globe, legislation on caste discrimination in U.K., human rights in the host country (GOPIO), supporting Telangana Movement, advocating and financing AAP, Overseas friends of BJP, Alumni Associations etc., Diaspora advocacy of India’s nuclear deal, Overseas Citizenship etc. Advocacy has also helped in creating awareness for education, healthcare, environment and democratic movement that are essential for long term sustainable development.

Indian diaspora advocacy has a long history. After returning from London in 1891, and having law practice in Rajkot and Bombay, Gandhi went to South Africa with a contract of one year. While in South Africa, he learned that the Indians in Natal province were just about to lose their right to vote. For Gandhiji, the issue was not only the specific grievances of the Indians but their individual and national self-respect. The satyagraha here was a part of the struggle of India for its dignity, and a moral crusade, though waged on the South African soil.

In recent times, one witnesses various types of diaspora advocacy such as Press conference, Strike March, Anti corruption campaign, Court cases, Poster campaign, Round table, Pamphlets Survey/Opinion Poll, Theatre, Workshop, TV or radio, drama Letter writing, Petitions, Public forum, Conference, Press release, Policy research, Exposure tour, Lobbying, Flyers, Website, Networking Coalitions or networks, Newsletter. Some of these advocacies have direct bearing on development back home and some have vested interest.

2.0 DEVELOPMENT AND PHILANTHROPY

In most societies, religion and culture shape the value system and motivate people in giving and philanthropy. However, the form and nature vary with religion, region, and culture. All major religions include the concept of charity or service. Christianity, including the Russian Orthodox Church and the Catholic Church in Latin America, have a long tradition of charity that is rooted in the theological concept of caritas, or love of others. One of the obligations of Judaism, which has influenced a small but important part of contemporary Russian philanthropy, is tzedakah or righteousness, which includes making gifts to others. Charitable giving or zakat is one of the five pillars of Islam and has shaped giving in the Arab countries and on the Indian subcontinent. Hindus and Buddhists follow the concept of dana meaning generosity or giving. Dana has also influenced the small but important Parsi or Zoroastrian community of India. Orthodox Hindus also believe in the concept of the pancha maha runas or the five great debts of the human being: to the ancestors, gods, sages, Confucianism includes concepts of altruism and treating others with humanity and, along with Buddhism and many other religions, has shaped the Chinese charitable tradition. Diaspora philanthropy cannot be separated from these broad foundational value systems.

Philanthropy is a positive human trait that is reflected through a wide range of social behaviors that includes informal expression of kindness to legislative campaigning for social justice, support for democracy etc. Though philanthropy is an age old phenomenon, transnational philanthropy as well as diaspora philanthropy is mostly found in the latter half of the 20th century. “Philanthropy is a culturally and historically specific concept, and, in the most general of terms, refers to the voluntary use of private assets (finance, real estate, know how and skills) for the benefit of specific public causes” (Anheier and Daly, 2004: 159). In the globalised world with the technological revolution, the expression of humanitarian traits and behaviour is no more confined to a limited space and region. Young and Shih (2003) use the term philanthropy in a transnational context i.e. it meaningfully identifies common ground on distinct historical, cultural and religious traditions. ‘Philanthropy’ often shades into, or departs from ‘self-help’ or ‘ mutual aid’ on the one hand (as, for example, in giving to or through kinship networks), and may mesh with the pursuit of commercial or political advantage on the other (as in wealthy individuals making charitable relations). We make no normative judgments about this, not least because any attempt to pronounce on what is ‘real’ philanthropy would entail immersion in ethical puzzles that have plagued moral philosophers for millennia. By ‘philanthropy’, therefore, we simply refer to the private and voluntary transfer of resources (money, goods, services, knowledge, skills or time) for the benefit of others, irrespective of either the motives of the donor or any benefits that may accrue to the donor.

Studies by Dhesi (2007) and Shinder Thandi (2007) and several scholars have found that villags in Punjab have benefitted from remittances from the Punjabi diaspora. The diaspora has helped many villages to have connectivity to underground water supply, sewage treatment plant, cemented road with solar lights, village parks, community centres, etc. They found that the diaspora helped in providing sustainable, cost-effective, particpatory, inclusive model of village modernization that led to not only improved quality of life but also substantial reduction in sanitation borne diseases.

Philanthropy has many dimensions. In recent years there has been scholarly debate on the development aspect of the philanthropy especially linking to the global equity. Geithner et al. (2004) observe “transnational philanthropic flows are important because they reinforce civil society. Philanthropy is the monetized expression of a community’s commitment to its future. Remittances and diaspora philanthropy provide a stream of evidence of the commitment of private individuals to the future of their families and their communities” .

Diaspora is not the same as an ethnic group. Diasporas are as Werbner (2002) observed “embodiments of cultural, political, and philanthropic sentimental performances…they exist through material flows of goods and money, through gestures of ‘giving’ or public service. Often these three dimensions of materiality- culture, politics, and philanthropy- are intertwined. Members of the diaspora mobilize politically to defend against injustices and human rights abuses suffered by co -diasporics elsewhere”. The unprecedented growth of global wealth, the globalization of the economy, the increased mobilization of individuals and the development of a global nonprofit sector are creating an encouraging environment for diaspora philanthropy.

Philanthropy is seen as equity enhancing at the global level, acting beyond the broader concerns of government and the narrower interests of business (Kuljian, 2005:1). Social investing can contribute not only monetary resources, but also new skills, fresh thinking, and innovative approaches to global problems.

2.1 Institutional Approach to Diaspora Philanthropy

The most important challenges today are harnessing the potential of the philanthropy. Networking and institutional supports are very essential. Philanthropy comes through various channels- individual (personal capacity such as contribution to his or her own village development), intermediary (aligning with NGOs or other groups with similar interest but not direct involvement) and institutional (support from Ministry, UNDP through collaboration with regional and national level policy) .

Diaspora and its engagement with the home country became institutionalized in the 1990s in almost all parts of the globe. Associations, institutions and various forms of virtual networks have rapidly grown to channelize the resources and engagement between diasporas and home countries. Thanks to the development of Information and Communication Technology many kinds of global networks have been made possible. Given a lack of resources, time, or expertise, many diaspora members rely on philanthropic intermediary institutions/organisations to channel their donations to specific community projects in their countries of origin. There are institutions in both home and host countries that facilitates the diasporic philanthropy. A number of governments, private corporations, and migrant associations have established their own or joint grant programs to help funnel wealth toward development projects in countries and communities of diaspora origin. Mark Boyle and Rob Kitchin’s (2014) study on institutional responses at global and local level gives a very interesting development on the diaspora and home state engagement. Though development projects can be initiated/administered by state agencies, NGOs, corporate bodies or individuals, philanthropy is never done by state agencies. However, state agencies, legal structure and political and economic conditions generally affect the diaspora – home country relations to a great extent. Diaspora and home countries relations in many conflict ridden African countries has been hostile. Even in counties like China the relations between diaspora and home country was one of tension for some time. India’s experience during the Khalistan movement has been similar. However in recent times, the environment in countries like China and India has been changing. For example China has attracted phenomenal diaspora participation in investment in the last two decades due to conducive policy. India has taken various initiatives such as introducing PIO Cards (Persons of Indian Origin Card) that allows persons in diaspora (1) visa -free entry into India during the period of validity of the PIO Card, (2) exemption from the requirement of registration if stay in India does not exceed 6 months. Should the continuous stay exceed six months, registration is not required even if their visit exceeds 180 days, (3) parity with non-resident Indians in respect of facilities available to the latter in economic, financial and educational fields, (4) all facilities in the matter of acquisition, holding, transfer and disposal of immovable properties in India except in matters relating to the acquisition of agricultural/plantation properties, (5) facilities available to children of Non Resident Indians for getting admission to educational institutions in India including medical colleges, engineering colleges, Institutes of Technology, Institutes of Management etc. under the general categories, (6) facilities available under the various housing schemes of LIC, State Governments and other Government agencies.

2.2 Diversities in Diaspora Philanthropy

As earlier discussed philanthropy is a broad term that includes a wide range of social behavior from individual acts of kindness to legislative campaigning for social justice, support for democracy etc., India has a long tradition of its diaspora’s involvement in India’s development since the freedom struggle.

Diaspora Philanthropy has been as old as diaspora itself. During that time, the indentured labour use to send remittances for philanthropic purposes despite their own harsh struggle. They gave support for the Indian freedom struggle and various ways of involvement in the national movement. They have been part of various socio-religious causes.

Later we find the global network of Indian religious and faith based philanthropy. Hindu, Muslims and Sikhs have their own diasporic networks many of them engage in providing education, healthcare to the people in similar faith. Educational chain maintained by Shiromani Gurdwara Prabandhak Committee (SGPC), Amritsar, Punjab mobilises funds from Sikhs including diaspora Sikhs. Other areas like healthcare and education have also received diaspora philanthropy. One institution that needs to be mentioned here is L.V. Prasad Eye Institute in Hyderabad, set up as a not-for-profit trust, in October 1986 by an NRI, Gullapalli N. Rao, then an Opthalmologist in Rochester, New York. The institute supported by NRIs in diverse ways, including entire planning and development, collaborative support in teaching and research and significant monetary help to create world class infrastructure.

2.3 Knowledge Philanthropy and Investment

Since last three to four decades Indian migrants are predominantly occupying the space in global knowledge industries. There are also visible presences and benefits of the diaspora contribution to the knowledge based industry through various cooperation and support from the diaspora. Two of the major areas such as Information Technology and Healthcare brought have made remarkable progress to the Indian economy through diasporic contribution. However, the results need to be more inclusive.

Knowledge philanthropy ranges from providing engaging with research and development, teaching, training, skill development, idea sharing etc. These can happen directly or indirectly, through virtual platforms or through direct physical involvement. These philanthropist are often considered as a new breed of philanthropist in different names “venture philanthropy, ” “impact investing,” “entrepreneurial philanthropists,” providing “social venture capital”

2.4 Diaspora Philanthropy in the context of global equity

The recent debates on global development have been stressing on inclusiveness. Of late, diaspora philanthropy is seen as a part of community engagement with the development back home. The Harvard School of Philanthropy has been advocating philanthropy in general and diaspora philanthropy in particular as one of the processes that can bring global equity through community participation.

Historically, philanthropy is often been associated with local issues and developments. However, with rapid migration across the national boundaries, development of ICTs etc. the contour and texture of philanthropic and community engagement has changed drastically.

Financial progress or new wealth has been accompanied by another consequence of liberalization: growing inequality. Not everyone benefited from the new capitalist economy. Many studies reveal the unequal distribution of new wealth and, in most cases, an increasing income gap between rich and poor in emerging economies. Growing inequality has been seen in almost every countries, but the developing countries are most affected. For example, a study by Organisation for Economic Co-operation and Development (OECD), 2011 documented the heavy concentration of wealth in Argentina, Brazil, China, India, Indonesia, Russia, and South Africa. Four of these countries- China, India, Russia, and South Africa-have become less equal over time. Only Brazil and Indonesia have been able to reduce inequality in the last 20 years, and, as the study points out, inequality remains very high in Brazil. Furthermore, when compared with developed countries, social expenditures that benefit poor citizens are also low in these emerging economies and tax systems are not designed to reduce income disparities. Another study by the Carnegie Endowment for International Peace (Shaw, William and Bennett Stancil: 2011) concluded that overall measures of inequality have increased in China and India and that although inequality declined somewhat in Latin America, it remains stubbornly high. In this context the diaspora philanthropy in various human development and capacity building areas are highly welcome.

Conclusion

Though one cannot ignore the potential of diaspora philanthropy, it is not a solution for all situations. India being a vast country having complex problems, needs a variety of alternative interventions. Diaspora philanthropy can be promoted through the involvement of civil society along with NGOs. Non profit organizations need to establish a distinct identity, adopt transparent accountable mechanisms and approaches for fundraising in a strategic fashion and extend their program sphere to tackle hitherto atypical areas not previously addressed by any other organizations.

There is a need for appropriate policies, infrastructure, legal and regulatory tax system and resources in place to involve the diaspora communities in national development initiatives. Often there is a wide gap of perception of development by the diasporic person who wishes to develop the local community and the community’s own perception of development. Thus, there should be proper understanding and collaboration between them in order to bring in substantial changes. What are the psychological, intellectual, and emotional attributes of the potential collaborators (diaspora) at home institutions? How does the home community perceive the diaspora’s involvement? Are the dynamics of cooperation between the diaspora community and those at home well understood? These are important to understand in the process of engaging the diaspora in development.

Proper documentation of philanthropic activities is necessary to measure the volume of activities overseas Indian offer and the expertise and kind of activities they are interested in. This documentation may help in making proper distribution of their service to the less privileged.

Various institutions, most notably scholarly and academic, have to be actively and carefully engaged to implement such initiatives. Even if national governments embrace such initiatives, without the full support of these institutions and their scholars, chances are that they may be thwarted. This is not of course a rationale to advocate that initiatives between the diaspora and institutions be channelled through government bureaucracy.

While the Indian non-profit sector is large and lively, India’s legal, tax, and regulatory systems do not encourage the creation of foundations. Laws governing the sector are complex and archaic and their implementation is cumbersome and bureaucratic. One important law, for example, dates from 1860.

Tapping the philanthropic contribution in different generation needs institutional support at various levels. However due to various limitations at political and administrative levels many of these potential donors are not able to connect with the home country. It is very important to consider diaspora as stakeholder where they find meaning in ideas, financial and other support.

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