Investors Embrace Social Enterprises in India with Renewed Confidence

Indian social enterprises are beginning to gain the attention of investors once again, following a lean period that was triggered by the microfinance crisis of 2010. The investors are increasingly willing to shed their cautious approach towards socially driven enterprises, providing a much-needed boost to social entrepreneurship projects in the country.

The social enterprise sector in India is primarily geared towards addressing the needs of the bottom of the pyramid, which constitutes a large segment of the population that lives below poverty line. The enterprises help create conditions for the social and financial inclusion of this segment into the society's mainstream.

Aparajita Agarwal, co-founder of Intellecap, a social investment consultancy company, says: "Investments definitely took a hit because of the recession and the microfinance crisis. But they seem to be back on track." Investments had gone down last year, with social venture capital funds such as Aavishkaar India Micro Venture Capital Fund, Lok Capital and Acument Fund investing an aggregate of $48 million in social projects in 2011, as against $50 million the year before.

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Vikas is a staff writer for the Sustainable Development news and editorial section on Justmeans. He is an MBA with 20 years of managerial and entrepreneurial experience and global travel. He is the author of "The Power of Money" (Scholars, 2003), a book that presents a revolutionary monetary economic theory on poverty alleviation in the developing world. Vikas is also the official writer for an international social project for developing nations "Decisions for Life" run in collaboration between the ILO, the University of Amsterdam and the Indian Institute of Management.