Impact Investing should see a global rise given the prevalent global economic hassles, the current lowering of interest in almost every national central bank and volatile state of financial markets.
The report “Impact Investing: A framework for Policy Design and Analysis”, a joint effort of InSight at Pacific Community Ventures and Initiative for Responsible Investment funded by the Rockerfeller Foundation addressed a sensitive issue: How can Government Policies enable Impact Investment that shows for a systematic, optimally productive and a well-oiled system?
As underlined in this study, no market is devoid of either government aid, or government policy. To be able to better integrate the role of government in enabling impact investing, i.e. to attempt to provide for a set of guidelines for the government to learn from is the primary objective of this study.
The study is structured around three key evaluators: a model that illustrates the opportunities for policy intervention in impact investing, 6 criteria with which to assess the role of policy and its potential effectiveness, 16 case studies serve as examples of concrete interventions that shape and support impact investing markets.

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GRAS Academy is the pioneer in introducing a vocational skills training institute in India. Their no-frills approach to vocational and special industry oriented courses gives the underserved youth of the country the chance of finding skilled and hence a better paying employment. GRAS Academy offers training in the field of computers, IT, banking and financial services, mobile repairing, nurse training, personality development, English speaking training and more and is viable option for most economically backward households given its reasonable course fee structure. GRAS’s tie-ups with several State Governments, the Central Government, NGOs and international bodies facilitates the dispensing of this no-frills educational program through which the youth in both rural and urban settings with a history of early school drop-outs and families with low income generating prospects have benefited. However, recent investment plans of GRAS have resulted in a focus on special income groups.
GRAS is in an existing partnership with the Rajasthan State Government in order to provide industry oriented courses and job placements for youth under the Govt.’s mission to promote livelihoods for the poor of the state. GRAS is also a certified training institute in accordance with the 350 highlighted trades across several industries for skilling by the Govt. of India under the PPP mode. GRAS is also partners with several international organizations and private sector companies primarily to promote services in the line of retail and hospitality. In looking to expand its business over the next 4 years GRAS has declared an investment of INR2.2billion ($44mn). While an inflow of INR 620 mn ($12.4 mn) towards this end has come from National Skill Development Corporation (NSDC), an inflow of another INR 90mn ($1.8mn) was announced on December 14, which would come from MSDF (Michael and Susan Dell Foundation).
Their initial equity investment of INR 90 mn ($1.8mn) is subject to the condition that these funds would go toward training the children whose family incomes are below INR 13000 ($260) per month. This translates into a focus on the low income segment of the rural and urban population in the operational Small Training Centres (STCs) and mini Industrial Training Institutes (ITIs).
This means that children and youth coming from the BoP sector will be able to avail quality vocational education curriculum, which in itself will be enhanced by the influx of MSDF’s global knowhow. While the remaining INR 1.49 bn ($29.8) will come from GRAS’s promoters and their own business generated fund, MDSF’s involvement has made the role of youth and children from BoP sectors, in a way, mandatory to installation of the scaling process. According to Mr Gautam Sengupta, Director, GRAS, GRAS’s experience and MSDF’s support will make entrepreneurs out of the underserved youth, and motivate their participation in productive activity. The consequent prospect of financial inclusion over the long run alone is a star on the horizon for many, and perhaps what MSDF had foreseen while making this investment.
With formal educational statistics proclaiming that 15% of Indian students reach high school, and 7% of them graduate (this data not necessarily including the BoP masses of rural India), importance vocational education in elevating the level of income vis-a-vis what the BoP youth would have earned without skilled training is obvious. This guarantees job security for many of these youths, without having to rely on unskilled day-to-day labor. With the potential entry of Foreign Retail expansion measures, despite the spirited, yet debatable opposition, India’s unbalanced wealth distribution scenario has a chance to see recovery only if there is enough skilled labour to meet the demands.
GRAS’s history of efficiently serving 1.3mn underprivileged youth over the past ten years is reason enough to see this particular development as a cheerful prospect for the youth at the base of the pyramid population in India.

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Our deepest sympathies for the relatives of those who died in the AMRI fire of Kolkata, on the morning of December 9th, 2011.
This is an event that could have been prevented, and its entire course confirms the negligence of people in positions of power. This is result of the kind of haughty negligence that avoids the voice of reason when not coming from the mouth of a recognized source of authority. Collectively, the owners who made compromises on their fire equipment upkeep despite a similar incident in 2008, the management that continued the storage of inflammable materials in the basement despite warnings against such an action, and the hospital administration – including doctors and nurses who did not allow patients (most of who would not be able to walk, let alone run, by themselves) to be discharged when their relatives saw the lethal smoke arising from the basement, yet who fled without a backward glance when the danger became unavoidable – are all responsible for the 80+ deaths. The fact that 5 lacs people around the hospital in a 5 km radius were not in grave danger given the radioactive material which was kept right under the original floor of the fire, is nothing if not godsend.
This whole situation reeks of mismanagement and dubious dealings which resulted in the lack of a correct infrastructure which could have facilitated the fire escape procedures – and innocents have paid the price for it. The owners have been arrested for attempted homicide, and we cannot but learn from their callousness. Our prayers go out for those who have lost their lives and those who have permanently been marred by it – emotionally as well as physically.

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This particular CGAP study establishes their expertise in exhibiting a distinct understanding of the issue of being able to integrate consumer research into financial consumer protection policy-construction.
CGAP uses a three-fold research methodology here:
(1) Consumer Group Discussions, where guided by a moderator, a small group of people interact,
(2) Individual In-Depth Interviews, where specific important concerns are probed and prodded for better more clarity and better understanding on the matter,
(3) Quantitative Consumer Surveys with respect to topics such as provider complaints, the type of product.
CGAP is fairly confident of the accuracy and utility of this methodology, having used it in their own in-the-field research.

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On 8th July 2011, the National Sample Survey Office (NSSO), Ministry of Statistics and Programme Implementation released the key indicators of household consumer expenditure in India based on data collected in its 66th round survey during July 2009 – June 2010. NSS surveys on consumer expenditure are conducted quinquennially (every 5th year) with the last quinquennial survey conducted in NSS 61st round (July 2004 – June 2005). The NSS 66th round was the eighth quinquennial round covering 59,097 samples in 7,428 villages and 41,697 samples in 5,263 urban blocks.

The survey assumes heightened significance as India relies on it to measure income growth across the country, in the absence of an official income survey. The survey brings to light, the prevalence of the deep urban-rural divide in terms of consumption spending (and hence, income). Per capita spending of urban India was almost double that of rural India. This disparity is further accentuated by the stark inequalities that exist amongst states, as evidenced by the survey. To cite an example, the rural average monthly per capita expenditure (MPCE ) in Kerala was INR1835/USD41.28 while that in Bihar was only INR780/USD17.55. The key proximate factors contributing to widening of such disparities are the poor state of the agricultural sector in the country and the ineffectiveness of the government’s social safety net programs.

The situation is however, not completely grim as the survey results do also indicate certain fundamental positives. The 65% rise in rural consumption spending over the past 5 years is one of the clearest indications of India’s growth story having touched rural lives. The survey also tracks the composition of the consumption expenditure basket and here also certain encouraging signs are noticeable in this regard. Share of food in both the rural and the urban consumption baskets has declined significantly over the past two decades while spend on non-food items like durables have risen, a phenomenon associated with rising levels of prosperity.

“The road is long” and much remains to be done to ensure faster and more fluid percolation of economic benefits to all states and to rural India as a whole. The government needs to adopt fresh strategies such as engaging with the private sector to create innovative and customised business models to make India’s growth story more inclusive.

Our analysis of NSSO 66th round Survey can be downloaded here

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The recent report released by Center for the Study of Financial Innovation highlights the changing nature of the risks that the microfinance sector needs to manage now.
The traditional risks like credit risk , funding risk, liquidity risk are being replaced by newcomers like reputation risk and risk of “mission drift”.

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Indonesian President’s visit to India as the Chief Guest of the Republic Day celebrations this year has set the stage for the next round of robust growth of Indonesia-India trade flows. Indonesian and Indian officials have signed 18 Memorandum of Understanding ( MOU) which aims to double the bilateral trade by 2015. Indonesia is already the third largest trading partner of India in South East Asia and the current bilateral trade as of 2010 is USD 11 billion.

The investments that are planned are big ticket items in aiprort and rail infrastructure, coal mining, steel plant. The long term sustainability of these projects and resulting benefits to Indonesian economy will depend on how these projects are implemented. These could very well be the defining moments of building new economic relationships reviving the ancient cultural and cultural and trade ties ties with Indonesia.

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IFAD Rural Povery Report 2011 offers a comprehensive overview of the current state of rural poverty. In the last 10 years 350 million people have moved out of extreme rural povery but still 70% of the 1.4 billion extremely poor people live in rural area. The volatility of food prices, climate change and water shortages add up to the challenges. The solution lies in investment in agriculture and farmer capabilities to substantially improve the farm productivity. In order to support small farmers and grass roots enterprises an enabling ecosystem needs to be created which manages the risks and help them to successfully grow their enterprises.

The second report by European Report on Development Social Protection for Inclusive Development fills in the gap and makes a strong case of placing social protection high on the agenda of development in Africa.

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In this speech Stephen Green , outlines ways of collaborating in meeting the challenges of emerging multipolar world. He reaffirms his belief that there are no alternatives to market based solutions for development. He suggests harnessing innovative technology to negate the limitations of physical infrastructure. The role of western companies should shift from “win-lose” prism of interpreting the growth of multipolar world to collaboratively shaping and seizing opportunities. For example, supporting emerging markets to develop their capital markets is just one way to build a common future in this interconnected world. ,

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Robert Zoellick’s speech on \"The End of the Third World\"

may get into the hall of fame of the most influential speeches by the President of the World Bank Group.

While the contours of the multipolar world is yet to emerge, the direction is clear. His urge to forge a network of nations against the current background of global economic crisis is timely and nurtures the possibility of creation of a new order of international co-operation. The thing to watch out for is will the nation states recoil to the old way of pursuing narrower interests or take this opportunity to design a new inclusive world order.

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