Privatization has not worked to rural India’s benefit. Telecom, for instance, has been a big success in urban areas where phones are easily available and calls cost very little. But in rural areas teledensity is just about 2 percent. In health, housing, education, and transport, privatization has not led to similar benefits. The middle class cannot afford the expensive real estate in the cities or pay the high tuition of schools where children of the rich prepare for college in the US and Britain. Homelessness in urban areas is growing but there is no housing stock for the poor.

Reforms have not brought about necessary measures of justice or equality. The infant mortality rate is 67 per 1000 births and marked by regional disparities. HIV, malaria, and tuberculosis are rampant and require big doses of investment in public health. The courts are clogged. 500 million Indians do not have bank accounts. The unorganized sector in villages and cities does not get the recognition and institutional support it deserves. Agriculture, the mainstay of two-thirds of India's rural population, is declining. Farmers face a host of problems including soil degradation, lack of irrigation, poor seed quality, and the inconsistencies of world markets. Much more needs to be done to spread prosperity, especially to rural areas.

The Challenge for NGOs

Indian politicians and business leaders communicate with one another quite easily. The challenge before civil organizations is to speak for the people who get left out of this communication loop. This means getting the attention of both corporations and politicians.

However, corporations will only listen to NGOs who can read the fine print of corporate balance sheets and expose flaws in corporate processes and products. Companies will listen to NGOs who influence consumers and punish brands in the marketplace. Therefore, the challenge before NGOs is to understand the workings of big business and use this understanding to demand accountability.

Many NGOs have successfully met these challenges. Recently, farmers in the northern Indian state of Himachal Pradesh forced Ranbaxy, India’s biggest pharmaceutical company, to shut down one of its units because of the pollution problems. Ranbaxy had tried to bluff and then browbeat the farmers into silence. But the farmers sought expert scientific advice, built a case and went to court. Two NGOs, the People’s Science Institute and the Hazards Centre, were instrumental in finding the evidence for the farmer’s case.

Politicians tend to listen to NGOs when NGOs deal with causes that can alienate and upset voters. Pollution and the drying up of water sources are two examples. In cities, middle class residents have begun casting their votes for better civil services. They have come together in officially registered organizations called resident welfare associations (RWAs).

Delhi’s RWAs forced the government to scrap a World Bank sponsored project for the privatization of water distribution, citing concerns about rising water access rates. RWAs have also learned to question the business claims of private power companies and file objections with power regulators.

NGOs have a long way to go before they can substantively influence the political process. But many have made a good start. In the 2004 general elections, the Congress and the Left parties supported demands touted by NGOs, such as tribal rights over forest land, a law on the right to information, and a law guaranteeing at least 100 days of state-sponsored employment for the rural poor.

Limitations of civil society

Though laws on rural employment and the right to information have been passed, much of the social agenda for India’s poorest has yet to be implemented. NGOs clearly have much to learn about getting their agenda through.

Indian NGOs also suffer from an image problem. A common perception is that they carp too much and deliver too little. Often, they are perceived to hinder economic progress. NGOs also face charges of corruption and fraud. Many NGOs are launched for dubious reasons by bureaucrats’ wives and cronies of politicians.

But by and large, Indian NGOs work scrupulously. Some have devised excellent plans, especially for water management, education, organic farming, and health. The problem is that effective NGOs are generally confined to particular regions and can only help limited populations. Ongoing internal debate exists within the NGO sector; NGOs are still struggling to find models that can be successfully implemented across diverse regions.

One solution has been partnership with the state in order to take advantage of the government’s reach and resources. The government is certainly aware of NGOs’ ability to innovate and deliver services efficiently, and has show interest in partnering with them. For the first time, the state has framed a policy for the NGO sector. The government would especially like NGOs to work with village level institutions and their elected representatives on a range of services from water management to health. The new policy has, by and large, been welcomed by NGOs. Critics, however, ask why non-profits should become contractors for the state and accuse the government of fobbing off its responsibilities onto NGOs.

NGOs need external regulation. However, to deal with accountability and corruption the new policy calls for self-regulation. It is not clear what self-regulation will involve. But it must begin with NGOs making their bankrolls public and revealing how much they actually spend on the causes they claim to serve. Indian NGOs could also do with greater internal democracy and self-criticism.

NGOs also must evolve to meet the needs of an expanding economy. They need to put technology, particularly information technology, to greater use in helping local businesses link to the wider economy. Information technology should also be used to deliver better health facilities and spread literacy and education. Such technologies can provide transparency in local government and make official records accessible. Some of these changes are taking place, but there is a growing digital divide between “Rich India” and “Poor India”.

Indian NGOs have the tendency to impose their own vision of the future on people. They tend to have a rather outdated socialistic approach to development. However, NGOs are valuable because they are in a unique position to address concerns overlooked by the government: therefore, they must listen more closely to what people want. In a world shrunk by technology, popular aspirations change rapidly. It may be wrong to assume that the average Indian is against privatization. What she or he is perhaps seeking is privatization that empowers individuals (not corporations) to build businesses, earn more, and enjoy greater choice in their lives.