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Charities this year to touch record Rs.173 billion: Philanthropy in Pak hits a new peak this Ramadan

Karachi, Jun 04: As Pakistan enters the election cycle and fears of disruption in the democratic order recede, people heave a sigh of relief and focus on their religious and societal obligations in the holy month.

Living up to their reputation generous Pakistanis are donating liberally this Ramadan. The magnitude of charitable giving in Pakistan this year is expected to touch a new peak of around Rs173 billion. The estimate was worked out by hiking last year’s charity spending of Rs158bn by 10 per cent. Many market watchers consider the projected estimate to be conservative.

This scale of giving is despite comparatively less aggressive donation collection drives by charities this year. “I don’t think the need for donations or the focus on collection in Ramadan has weakened. The harsh summer could have discouraged door to door collection but promotional campaigns on television are noticeable.

“Besides, the recognition of the potential of social media to push causes might have tempted charities to adjust their marketing strategies. With less physical visibility on billboards and team activities in target localities, donation seekers might be using networking platforms to spread their message,” commented a banker handling accounts of big charitable entities.

“In a country like Pakistan where philanthropy is said to be universal, a 10pc increase in the volume of charitable giving in Ramadan at over five per cent GDP growth is completely believable. For Muslims charity is not a choice. Islam ordains Muslim to pay Zakat on the value of accumulated wealth beyond a specified limit at the rate 2.5pc”, said Mr Nasrullah Abid associated with the sector.

“I don’t think a five per cent GDP growth rate can necessarily afford a 10pc increase in annual donations in Pakistan. Even if we assume that benefits of growth are equitably distributed and family incomes did increase over the year, it by no means implies that assets of an average family also mounted.

“People could be consuming the additional income with a zero effect on Zakat calculations since Zakat is based on wealth assessment and not income”, a board member of a major charity institution in Karachi contested.

A study ‘The state of individual philanthropy in Pakistan’ released in 2016 by the Pakistan Centre for Philanthropy revealed that the total estimated magnitude of annual household giving in Pakistan was Rs239.7bn in 2014 a three-fold increase since 1998. It found that major share comprise of monetary donations but people also donate in kind and through time volunteerism. For valuation purposes all kinds of giving was monetised.

“If the volume of donations can double every five years, in a period of 16 years ending 2014 (posting a 20pc increase per annum), during a time when the mean GDP growth rate was lower than it is today; we can safely assume that the magnitude of donation may have multiplied faster during the past four years of economic revival,” commented an expert on the subject.

The Stanford Social Innovation Review in March 2018 commented on the trend of philanthropy in Pakistan. It stated that charitable giving in the country is over one per cent of GDP. In this respect the country is said to be in the league of far wealthier nations such as United Kingdom (1.3pc) and Canada (1.2pc) and stands about twice at what India spends on giving in terms of percentage.

When reached over phone a senior team member of a charitable hospital was baffled by the figure reflecting the volume of charity.

“To me these numbers seem to be a figment of some fool’s imagination. If a most prestigious institution in the health sector struggles for a budget the way we do, I am not sure about all this talk about generosity in this country. Yes, in Ramadan inflows are at their highest but for our project they’re in millions, not billions of rupees,” he told Dawn over phone.

“Pakistanis in general may be compassionate but in my experience the ultra-rich here are worse than their equals elsewhere. It is hard to justify the statement in the absence of verifiable evidence at a national scale but anyone who doubts it can test it. People who spend hundreds of thousands on an evening count hundred rupee notes several times over when they make donations”, added the gentleman.

A former official of a research group that explored the subject said that most social welfare practitioners review trends from a very narrow prism of their own experience.

“Philanthropy in Pakistan is not limited to Shaukat Khanum Hopital, Sindh Institute of Urology and Transplantation, Indus Hospital, Edhi, Chipa and Citizen Foundation. Most families reach out to the needy themselves. Communities such as Memons, Agha Khanis, Bohris, Dehli Saudagaran, etc run multiple philanthropic projects for their members.

“Outside big cities mosques serve as collection points for donations. There are mosques in areas where there is nothing else.

“If Indonesia is said to have 800,000 mosques, Pakistan must not be far behind. In dense localities you get to hear several prayer calls throughout the day, instead of the requisite five. Keep these dimensions in mind and charity numbers will start looking believable,” another person associated with a charity, forbidden to go on record, told Dawn privately.

Despite the scale, public involvement in the practice and the indirect benefit it draws from the activity, the Government of Pakistan mostly watches from a distance.

It only intervened a few years back to criminalise the practice of financially supporting banned organisations and their welfare fronts through individual donations to curb militancy.

Several high ranking officers confirmed to Dawn that the subject has never been discussed in any top forum at the federal or provincial level.

“It is a private activity but it provides relief to the neglected and the poor. It becomes all the more relevant in Pakistan as the state is too self-indulgent to be able to meet the very basic obligation of providing social security to all citizens,” commented an economist.