Boost to Higher Education: Govt Incubators, Public Universities will be Funded Now Under CSR
In a bid to revitalise the higher education sector in India and to forge stronger linkages among industry and academia, the government has reclassified the scope of 2% mandatory corporate social responsibility (CSR) contribution made by companies. Presently, companies can spend their contribution on centrally funded and state-funded academic institutions, universities and incubators.
Prior this month, the ministry of corporate affairs (MCA) through circular notified provisions that expand the categories of CSR spending. Presently, a company can utilize its CSR fund on incubators funded by central or state government or any agency or PSU of central or state government, a senior government authority said.
Firms would now be able to send on institutions engaged in conducting research in science, technology, engineering and medicine, which is planned for promoting sustainable development goals. Prior to this circular, companies were permitted to give CSR funds to tech incubators situated inside focus approved academic institutions, the authority included.
These contributions can be made to public-funded universities and IITs. It additionally incorporates national laboratories and autonomous bodies under the Indian Council of Agricultural Research (ICAR), Indian Council of Medical Research (ICMR), Council of Scientific and Industrial Research (CSIR), Department of Atomic Energy (DAE), Defense Research and Development Organization (DRDO), Department of Science and Technology (DST), and ministry of electronics and information technology.
AMRG and Associates CEO Gaurav Mohan noticed that ongoing changes in Companies Act in connection to CSR costs has enlarged roads for social contributions by corporations.
“From now on any contribution to public-funded universities, IITs etc aimed at promoting sustainable development goals would also be accepted as an approved CSR expense,” he added.
Chief of Nangia Anderson, Sandeep Jhunjhunwala clarified that other than acquiring by and large expansion research and development (R&D) funding, with this move, the brooding cells would likewise have the option to gather the benefit of tutoring backing and skill of corporate sector.
“On the other hand, corporate India would be benefited with the industry-academia alliances, which could bring in targeted collaborations in various spheres, a practise that is well followed in some of the developed geographies across the world. Over a period of time, the government should consider further widening of CSR spend bucket to make funding to private incubators and accelerators as eligible, to boost the start-up ecosystem,”
India is the primary nation on the planet to make CSR mandatory for all profit-production companies meeting a specific threshold under the Companies Act, 2013. Given that CSR provisions have been in presence from FY15 just, there has been impressive advancement both in terms of companies adding to CSR and the general spend.
During FY15, private companies and public sector undertakings (PSUs) spent around Rs 10,066 crore on CSR, which went up to Rs 14,528 crore during FY16. This amount went down marginally to Rs 14,242 crore in FY17. During FY18 (till October 10, 2018) companies had spent around Rs 8,365 crore on their separate CSR initiatives.
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