FSG's Report on Informal Housing, Inadequate Property Rights
In India, as in many other developing countries, urban population growth and the short¬age of planned affordable housing have led to 26–37 million households (33–47 percent of the urban population) living in informal housing (residences on encroached land or in unplanned settlements). This report written by FSG and funded by Omidyar Network applies a property rights lens to segment the different types of informal housing, to understand the size and the needs of these segments, and to identify potential solutions to meet these needs.
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About the report
With their Annual Impact Report 2016 Aavishkaar has this year tried to take a deeper look at their impact thesis and their focus on the distinction between the fund impact and portfolio impact. Find the full report here.
Aavishkaar, part of the Intellecap-Aavishkaar Group is one of the global pioneers in taking an entrepreneurship based approach to development. Since its incorporation in 2002, Aavishkaar has gone on to make more than 50 investments, across sectors and has raised five funds with a total of ~US$ 200 million under management. Through this, Aavishkaar has successfully demonstrated the potential for venture capital investment in enterprises that engage with the low-income population or operate in under-served markets. Aavishkaar began with a focus on early-stage enterprises operating in India, and with the launch of Aavishkaar Frontier Fund in 2015, it is now expanding into South and South East Asia.
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This report by Jack Luft and Tim Chambers, and sponsored by the Shell Foundation, the Small Foundation, and Epven, reflects the first-hand experiences and perspectives of over 70 asset finance experts, contains case studies from Kenya, Guatemala, and India and highlights the critical success factors that drive scale in asset finance.
It can be accessed via the link below:Read more »
1. Relaxation of rules for application of higher withholding tax rate in the absence of a PAN
The Indian Income Tax Act provides for a payer to apply a higher withholding tax rate if the recipient of income does not furnish its Permanent Account Number (PAN). This was also applicable where payments were effected to non-residents and the latter had to obtain a PAN to that effect.
However, the Indian tax authorities have recently issued a notification whereby the requirement for non-residents to have a PAN has been made less stringent. Pursuant to the notification, the higher withholding tax rate would not apply to a non-resident for the following payments, even though it does not have a PAN:
(iii) Fees for technical services; and
(iv) Payments on transfer of any capital assets.
Nonetheless, the non-residents which would be receiving the income should furnish the following details:
• name, email, contact number;
• address in country of residence;
• Tax Residency Certificate (TRC); and
• Tax Identification Number (TIN) in country of residence.
Most of the above details are already being provided by non-resident recipients of income by way of a TRC and/or Form 10F which are prerequisites in India to avail of benefits under a Double Taxation Avoidance Agreement (DTAA). The new amendment will, therefore, reduce the administrative and compliance burden for non-residents which are receiving income from India.
2. Amendment to the retrospective applicability of the General Anti-Avoidance Rules (GAAR)
The Income tax department in India has, via a notification issued on 22 June 2016, provided clarifications on the retrospective applicability of the General Anti-Avoidance Rule (GAAR) as follows:
(i) GAAR will not apply to income derived by a person from transfer of investments made before 1 April 2017. The earlier version of the GAAR provided for this date to be 30 August 2010.
(ii) GAAR will apply to any arrangement irrespective of the date it has been entered into if a tax benefit is obtained on or after 1 April 2017. Previously, this date was 1 April 2015. 2
3. Liberalisation of foreign direct investment policy in India
Further to a meeting chaired by Prime Minister Narendra Modi on 20 June 2016, the Government of India has taken steps to further liberalise the foreign direct investment (FDI) regime and on 24 June 2016, the Department of Industrial Policy and Promotion (DIPP) issued Press Note 5 of 2016 Series (Press Note). Now, most sectors would fall under the automatic approval route, except for a small negative list. As per the Press Note, changes introduced in the policy include increasing sectorial caps, bringing more activities under the automatic route and easing of conditionality for foreign investment.
As impact investing matures as a movement, more investment models are being deployed, especially in sectors and regions where various forms of capital are needed to support solutions to some of the world’s chronic social and environmental issues.
In this report by the Toniic Institute with support from the Shell Foundation a number of examples are shown of how venture philanthropists and impact investors are working together to fund early-stage impact enterprises around the world.
The report is also a “call to action” for all venture philanthropists, impact investors, and other players within the early-stage social impactfunding ecosystem to continue to test, scope and roll out collaborative efforts in order to catalyze impact investment capital. The reward for greater collaboration according to the report can be a higher volume and quality of investment activity, which will attract greater, smarter impact capital into the marketplace, ultimately enhancing the viability of impactful solutions for the world’s toughest problems.
For more details please read the full report attached.Read more »
India is now among the top five countries in the world in terms of investment in renewable energy, solar photovoltaic (PV), solar water heating capacity, wind and hydropower capacity, according to a global renewables report released at the beginning of the month.Read more »
The survey conducted by EMPEA, a global industry association for private capital, featured the views of 107 Limited Partners (LP's) on emerging markets private equity asset class.
The report said, “India has ridden an impressive wave of upward momentum over the past three years, experiencing the largest positive shifts in the LP attractiveness rankings in both 2015 and 2016.”
“Increasingly bullish LP sentiment toward India coincides with rising fund commitments: in 2015, fund managers raised US$4.5 billion for India—the most raised for the market since 2008.”
The survey showed that 30% of respondents plan to either begin or expand investment in India over the next two years, rather than other emerging markets.
Red Ribbon Asset Management Plc provides a managed route into India for investors who seek responsible wealth generation through the principles of Impact Investment. They are investing in excess of £400 million over the next decade in greenfield projects that are scalable and topical to the Indian economy. Get in touch with them to find out more.
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The ImPact Asset Class Primers series explores the many ways families make impact investments today, and the potential to create diverse and balanced portfolios of impact investments.
This month's report focuses on to real assets. Families investing in sustainable real estate, farmland, timberland, and fisheries can create measurable progress in addressing the local and global challenges of climate change, food security, affordable housing, and community revitalization. This primer explores real asset investment strategies families use today, as well as trends that may affect the market in the future.Read more »
Private Capital for Sustainable Development: Concepts, Issues and Options for Engagement in Impact Investing and Innovative Finance is the result of supported by the Danish Government (Danida) in cooperation with ET Jackson & Associates on strategies and tools available to donors (and other social funders) to mobilize private capital for sustainable development.
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Despite the emergence of hundreds of accelerator programs around the world, we know little about their effectiveness or how differences across programs influence venture performance. To address this gap, Social Enterprise @ Goizueta at Emory University and the Aspen Network of Development Entrepreneurs (ANDE) launched the Global Accelerator Learning Initiative (GALI) in collaboration with a consortium of public and private funders. GALI builds on the Entrepreneurship Database Program at Emory University, which works with accelerator programs around the world to collect and analyze data describing the entrepreneurs that they attract and support.
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