Now Reading: CSR spending fails to create jobs, says Amitabh Kant
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CSR spending fails to create jobs, says Amitabh Kant
Former NITI Aayog CEO Amitabh Kant has said that corporate social responsibility (CSR) spending by Indian companies has failed to generate significant employment or deliver deep social impact in rural areas. Speaking…
Former NITI Aayog CEO Amitabh Kant has said that corporate social responsibility (CSR) spending by Indian companies has failed to generate significant employment or deliver deep social impact in rural areas. Speaking at a Suzuki Motor Corporation event in Bengaluru, Kant urged companies to move beyond conventional CSR and invest in scalable, technology-driven rural entrepreneurship models.
Kant said India must prioritise job-rich entrepreneurship in rural areas to achieve its goal of growing from a $4 trillion economy to $30 trillion by 2047. He noted that while a lot of money is deployed through CSR, it is not creating enough impact in terms of jobs or rural development. He added that the government alone cannot create entrepreneurship and jobs at scale, and called on corporates to adopt models like Suzuki's Next Bharat Ventures, which provides funding, mentorship and market linkages to rural enterprises.
Kant said Suzuki's fund-of-funds initiative could have a social impact exceeding that of its automobile business, as each supported enterprise has a multiplier effect. He urged other companies to replicate and expand such models to create sustainable livelihoods and strengthen India's MSME sector.
Indian Opinion Analysis
Kant's critique comes over a decade after India's 2013 Companies Act mandated that firms spend at least 2% of net profit on CSR, yet official data has repeatedly shown that spending clusters in a few states and sectors like education and health, with negligible job creation metrics. The government itself, through the Ministry of Corporate Affairs, has acknowledged the lack of outcome-based reporting. Kant, who launched the Startup India movement in 2016, is signalling that the next wave must be rural and job-intensive, not just urban and valuation-driven. The question now is whether the Securities and Exchange Board of India or the corporate affairs ministry will tighten CSR rules to mandate measurable employment outcomes, and whether large business groups will follow Suzuki's model of running venture funds rather than writing cheques to NGOs.
The next signal to watch is the annual CSR data release by the Ministry of Corporate Affairs, expected later this year, which will show whether aggregate spending shifted toward job-creating enterprises.
Source: thehindu.com
This brief was synthesised by AI from the source linked above.
