Economic research

Around the Indian economy in five studies

Social sector organisations, which aimed to help people through the Covid crisis, were also affected by the sudden disruptions triggered by the pandemic. There has been a significant reduction in funding available to them, and lockdown and social distancing protocols have affected their own staff and programs, forcing them to adopt new ways of operating.

A stocktaking study, carried out over a period of five months from January to May 2021, shows that the future of several organizations in the social sector seems uncertain due to the changes induced by the pandemic. Organizations have been unable to implement their existing programs due to various constraints ranging from physical distancing norms, fundraising and adapting to an online mode of working.

  • 7% of organizations surveyed said there was no change to their program, while 31% adapted all programs to the Covid-19 situation.

  • 54% have blocked a few programs and adapted the rest to the Covid-19 situation.

  • 42% saw a reduction in funding, 35% reallocated funds for relief work and 33% saw no new funding.

  • 54% of the 107 organizations responded saying they had received new funding in the April-December 2020 period.

In addition to pandemic-related issues, most small organizations have faced fundraising challenges due to changes introduced by the Foreign Contribution (Regulations) Amendment Bill, 2020. 53% of organizations surveyed expect a reduction in funding over the next two to three years. .

Over the next few years, as these organizations respond to the needs of those severely affected by the pandemic, there will be a need to upgrade technology and skills. There is also a need to raise funds from a diverse set of sources, according to the study.

While large organizations have the capacity to meet regulatory, reporting, and compliance requirements, smaller grassroots organizations struggle to meet the needs, which can put their survival in doubt.