State to use CSR funds for development plans
The state government will turn towards corporates to enlarge the state’s corporate social responsibility (CSR) reserves for socioeconomic development.
Uttar Pradesh is among the top five states who corner most of the CSR funds from companies. Others on the list are Maharashtra, Karnataka, Gujarat and Tamil Nadu. Section 135 of the Companies Act, 2013 (Act) mandates certain firms to allocate 2 per cent of their average profits from the preceding three financial years towards CSR activities. UP’S Chief Secretary Durga Shankar Mishra said the state will organise a ‘UP CSR Summit’ to script a new chapter in the process of collaborative socioeconomic development.
The state is counting on its large consumer market and growing heft to impress the private sector to loosen their CSR purse strings. “The core idea of CSR lies in the ancient ideology of collectivism. During the pandemic, we witnessed a demonstration of the country’s collective strength,” Mishra said, addressing CSR heads of prominent companies at a recent CSR conference in Lucknow. The state has also acknowledged the contribution of leading private sector companies-vedanta Group, HCL, NCL, Reliance Foundation, Shiv Nadar Foundation, ITC Limited and NTPC in a large scale through CSR funds. In 2022-24, UP collected around ~1,500 crore in its CSR corpus, which were used in projects pertaining to women and child development, education, vocational education, etc.
In 2014-15, UP garnered only about ~148 crore that grew to ~435 crore in 2017-18. In 2021-22, UP saw a CSR spending of ~1,321 crore that surged to around ~1,500 crore in 2022-23.
“There is no better place than UP for effective utlisation of CSR funds. The presence of 83.9 million registered workers offers a significant opportunity for utilising the CSR kitty,” UP Cabinet Minister Anil Rajbhar told CSR wing’s national heads of leading companies at the conference.
The cumulative CSR spent in India is estimated to be more than ~2 trillion. Even though UP has witnessed a sustained increase in its CSR kitty, the amount collected is small compared to its geographical size and population base.