Viability Gap Funding: The Emerging Model for Social Sectors Sustainability
Posted: 8 May 2010
Date Written: April 12, 2010
Abstract
Emerging economies are generally characterized by special focus on social sectors for achieving the much needed inclusive growth and sustainability.
This research paper proposes to analyze the various models for social sector funding in the West, and their current dilemma. It also aims to prescribe a model which is commercially viable for India by bringing in the 'viability gap funding' mechanism. It may also offer the much needed solution to the West that are large welfare states for healthcare funding and who are now hampered by international tax competition.
The approach to this problem should aim at shifting the focus away from the state and move towards public-private partnership. At the same time it should also ensure that the interest and initiative from the private players is sustained through the emerging model of 'viability gap funding'.
This paper aims to achieve the twin purpose of effective government supervision and proactive initiatives from the private sector to scale up the intellectual capital which is the very essence of a knowledge economy and also supported by proper healthcare for all.
In a country like India a major cohort of the population is young, and a creative and viable model for funding such projects by roping in the private players and effective supervision by the government could alleviate this problem of lack of funding and the consequent lack of initiatives from the private sector. The findings from this paper may provide sufficient inputs for such a viable model.
Keywords: Sector, Viability Gap Funding, Viable Model, Sustainable Growth
Suggested Citation: Suggested Citation