In her recent article on July 27, 2026 titled ‘What does courage cost us?’, Smarinita Shetty, CEO and co-founder of IDR, posed a critical challenge to India’s civil society, urging organisations to find their spines and demonstrate genuine courage in an increasingly hostile environment. This brings us to an uncomfortable question: Does our development sector ecosystem have the political capability for courage? Or does the process of institutionalising nonprofits dull the ability to question power?
People who join the social sector often do it for two reasons. The first is that they have a personal story that brings them to the point where they want to do something to address a particular issue, such as an injustice they witnessed or experienced, or a family member that went through a crisis. The second is that they have an insight into a wicked social problem that often leads them up the path of social change, with an idealism, a burning desire to find a standard-shifting solution or a zeal to scale up a pilot they executed with success. Society then constantly pushes grassroots leaders to ask questions, push back against systems that are failing, challenge regressive policies, and fight systemic injustice. But the resources, support, and infrastructure that are needed to keep that idealism, insight, and passion going for decades struggle to keep pace.
The elephant in the room is that we are asking people in the sector to function with resilience within a system that provides zero structural cover. India’s nonprofit sector comprises over five lakh registered organisations, yet a recent survey by Dasra found that 68 percent reported a funding deficit in FY 2024–25 and 90 percent named financial sustainability as their primary challenge.
When an organisation takes a political risk or faces an administrative crackdown, it is left to calculate its survival costs completely alone.
When Harsh and I started talking about this, we agreed that this was an urgent need and that we could write about this together. I sent him four ideas on what it would take to build a collective infrastructure that holds courage.
- An ecosystem advocacy body: An independent association backed by a Public Goods Fund that builds consensus on issues and puts out collective statements across platforms and protects vulnerable actors from being singled out. Every sector of business has its own association, apart from CII and FICCI to lobby for their work. Civil society needs its own separate entity. This is discussed later in detail.
- A pooled legal defence network: A shared legal defence fund and a shared counsel network, created perhaps by a foundation. This would allow organisations to respond to and speak out during crises without having to bear the risks and legal costs of doing so in an individual capacity.
- Strategic capital: We recommend that every organisation set aside resources for building and protecting civic space. Funders will need to be encouraged to support this as a distinct investment, one that is separate from funding for service delivery and other organisational activities.
- A pay-what-it-takes fund: Funders should cover what it actually takes to build and sustain a resilient organisation alongside what it costs to deliver a programme. This means funding core overheads, organisational reserves, essential infrastructure, and the systems and capabilities needed to withstand crises, regulatory pressures, and financial shocks.
Harsh then asked the million-dollar question: Which funder in India will fund this?
Philanthropic institutions seldom behave like radical agents of social transformation. They are answerable for outputs and impact. CSR capital in India is bound by statutory compliance, risk-averse board committees, and strict line items. High-net-worth individual donors are bound to family offices with targets. The scale of the constraint is clear: Only 14,445 organisations currently hold active FCRA licences, while roughly 22,500 registrations have been cancelled, many of them since 2015. India’s annual CSR outlay has been growing for more than a decade and in FY 23-24 it crossed INR 34,909 crore. But much of this capital remains tightly project-tied and risk-averse.
If civil society organisations must rise above being implementation partners who execute master plans for governments or corporates, they will have to reclaim their strategic agendas with courage.
Even within these constraints, the long-standing relationship between capital and civil society needs to shift. Genuinely concerned funders who care about systemic impact have always realised this and have stopped treating social change as limited to a series of twelve-month project cycles.
Lessons from private equity funds
Harsh and I used his knowledge of the corporate world to consider what CSOs can learn from how companies raise money from private equity (PE) funds.
1. Adopt a portfolio approach to risk
The first lesson is about how we think about risk. PE funds recognise that not every investment will succeed. Out of ten companies funded, they know that five might fail, three will break even, but that two will provide exponential returns. They design their portfolio with this variation in mind.
Philanthropic capital could adopt a similar approach. Rather than expecting every grant to produce predictable results, funders could deliberately allocate a portion of their capital to ambitious, risk-taking ideas and organisations. Some may fail completely; others may produce modest results; and a few may generate transformative change.
2. Invest in long-term institution building
The next step is to shift towards five- to seven-year grants that support core costs, leadership development, and resilience building. This means recognising the real costs of creating impact: people, technology, infrastructure, learning, and failure.
It also requires redefining risk and accountability. Rather than measuring performance primarily through activity checklists and short-term outputs, funders could place greater emphasis on deep learning, community agency, and systemic change.
This is particularly important because flexible and unrestricted funding remains scarce. Multiple analyses, including Bridgespan’s pay-what-it-takes work, have highlighted the limited availability of unrestricted funding. Many organisations report that less than 25 percent of their budget is flexible, while a large share have never received a multi-year grant.
Civil society organisations should stop waiting for institutional funding and embrace revenue streams that are often ignored.
The PE model offers a useful contrast. PE funds do not typically invest in a single project at a company. They conduct due diligence on the organisation, its business model, leadership, and track record, and then provide capital to strengthen and grow the organisation as a whole.
Philanthropy could similarly shift from funding individual projects to investing in the institutional capacity of organisations with the potential to create lasting impact.
We also suggest that civil society organisations should stop waiting for institutional funding and embrace revenue streams that are often ignored. We need to diversify the capital base, so no single donor has veto over an organisation’s voice.
Old ideas, new applications
Next, we argued over some old ideas that can be adapted in new ways, which we were certain might invite brickbats from you, the reader.
Gandhiji’s take
We talked about how mobilising citizen support for unconventional capital and allies is not being greedy. If an NGO delivers a service of substantial value, can it not confidently ask the community for a nominal fee for the services it provides? This was Gandhiji’s model of sustainability. He limited reliance on commercial advertisements for all his publications, maintaining that any service or journal must stand on its own social utility and be directly sustained by the people it serves.
When citizens contribute even a token amount, they move from being passive beneficiaries to paying stakeholders who can demand accountability. This requires a shift in the beliefs that CSOs hold about how they consider their ‘beneficiaries’. Can they be seen as ‘clients’?. Our belief is that in 2026, there is scope to explore models through which all people can contribute financially, however nominal the amount.
Mobilising citizen capital
Capitalising on public movements where immense public sympathy is aroused is not necessarily opportunistic. It can be a way to convert public concern into collective action. Nonprofits, however, rarely have the digital or organisational infrastructure to convert public momentum into pooled, citizen funds. In contrast, religious organisations never fail to ask for donations during festivals. And political parties also ask their supporters to cough up, especially when elections are around the corner.
Nonprofits can similarly use micro-donations and crowdfunding to tap into public sympathy, especially when there is momentum around a particular issue. They could also offer their data, expertise, networks, or collective power to support a cause. Examples of this include open-source software development and crowdsourced data collection for environmental monitoring, in which citizens have contributed financial resources as well as skills, information, and effort.
Institutionalisation versus the lobbying imperative
How can civil society prevent service delivery from obstructing political clarity?
Political knowledge and clarity are necessary for nonprofit leaders to protect their funding, achieve systemic change, and function within the labyrinth of legal strictures. It is this awareness that enables organisations to go beyond immediate service delivery and to address root causes of systemic issues by connecting authentic community voices directly to policymakers and elected representatives.
Clear political boundaries also allow leaders to advocate for their mission without crossing legal boundaries on nonpartisan activity, thereby maintaining public trust and their tax-exempt status. There are several ways to do this.
- Civil society needs to deliberately embed movement literacy into its structure. Create political learning within organisations so that people who join or choose to associate with the organisation know where it stands from day one. When CSOs treat political learning as a core competency rather than a liability, they engage staff and supporters who can navigate shifts in public momentum and mobilise citizen capital effectively.
- Segregate service delivery from movement building by resourcing and staffing them separately. This ensures that immediate community relief is never compromised by political risk, while dedicated movement teams retain the freedom to challenge systemic failures.
- Frame critiques around how policies affect human lives rather than engage in partisan rhetoric. By anchoring arguments in human-oriented outcomes, an organisation shifts the conversation from a volatile political comment to a reality check that can be understood across political divisions. This helps organisations to safeguard their legitimacy, protect their diverse funding streams, and build broader public consensus.
- Finally, shift from speaking for communities. Instead, give them a direct platform from which they can speak to power on their own terms. This is the right way for democratic organisations to work, and in the context in which we function, it also provides a powerful operational and legal shield. It creates a layer of insulation that safeguards the institution, because it is the citizens of the country that are critiquing a policy or move, rather than an individual organisation.
Mobilising people and building a movement is not always necessary, and can expose organisers to greater political pressure. But when the objective is to change policy or practice, collective action can sometimes produce results far sooner than submitting well-argued representations, writing papers, holding meetings, or making presentations to policymakers. Movements speak directly to political power.
Earlier this year, movements in Noida and Gurgaon by workers seeking higher wages caused significant difficulties for their organisers, but they also achieved results much faster than conventional advocacy might have. These movements were led by courageous individuals rather than large CSOs. In that sense, they also reinforce Smarinita’s point: Institutionalised civil society is not necessarily the only or the most effective vehicle for producing social and political change.
Building an industry lobby
There is a significant structural gap in how Indian NGOs interact with power. Every major industry in India has a professional association, yet our 150-year-old sector has no comparable body to defend its interests, engage continuously with government ministries, and shape national priorities. Yes, there have been efforts to fill this gap earlier, but they have been organised as informal networks that are not as effective as they need to be.
Courage cannot be an individual burden. It must be supported by collective infrastructure.
For that to happen, large NGOs particularly need to stop acting as individual, isolated, competing actors and together build an association that adopts the best practices of corporate advocacy, utilising data, impact, collective legal weight, stories and narratives to engage government and other sectors on more equal terms.
Collectives such as VANI and the National Centre for Advocacy Studies have played a role in the past. However, in 2027, India’s CSOs need a more effective model, one that matches the scale and influence of successful industry bodies.
If civil society remains an ecology of fragmented, short-term project contractors that rely on institutional benefactors, it will continue to have little or no ability to confront authority. According to a Dasra survey on nonprofits in India, 73 percent reported holding no corpus fund. This leaves them with little to no ability to absorb political or administrative risk.
Courage cannot be an individual burden. It must be supported by collective infrastructure, including shared legal and advocacy defense, PE-style innovation finance from donors, professional sector-level policy lobbying, and a restoration to true financial sovereignty based on citizen direct action. In the absence of these, nonprofits will continue to operate on borrowed time while bemoaning the loss of civic space.
To paraphrase Atticus Finch in Harper Lee’s ‘To Kill a Mockingbird’, moral courage isn’t defined by physical force or brandishing power. It is the willingness to confront overwhelming odds and push for change even when defeat seems pre-determined. It is about taking on a fight you know you’re likely to lose and seeing it through to the end anyway.
Smarinita Shetty’s article is an important wake-up call but appealing for courage without addressing the underlying political and financial dynamics will result in more burned-out leaders and suppressed groups.
Next steps for readers: turning words into reality
If what we have written resonates with you, we encourage all our readers to reflect and share their suggestions on how to convert these ideas into specific and effective efforts and models.
In the next few months, many of you will be attending large events and conferences. We urge readers and organisers of these events to create space to discuss any one or more of these issues and ideas in more detail. We also encourage you to use this Google Form to suggest practical ways of taking these ideas forward. You can share a specific idea, an existing example or model, a potential organisation or funder that could take it forward, or any concrete action that can be taken. Responses can be from individuals or collectives and can be anonymous. If you would like to volunteer to implement an idea, you can indicate this.
The form will remain open until December 31, 2026.
In January 2027, we will identify a group of sector representatives to review the submissions, identify the most promising ideas and practical next steps, and publish them on IDR. Depending on the interest that this effort generates, we could consider convening a meeting to put flesh to bones and enter the next financial year with more confidence and institutional backing to the vital work that we do.
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Do more
- Take a few minutes to fill out this Google Form if you’d like to suggest practical ways in which the ideas presented in this article can be taken forward.
