To the rescue? Bill Gates in India
Editor’s note: This excerpt from 'The Bill Gates Problem: Reckoning with the Myth of the Good Billionaire’—details the first years of the Bill & Melinda Gates Foundation in India. Investigative journalist Tim Schwab offers a fascinating account of a team armed with great expertise, ambition and confidence—and their encounter with the messy reality of India. This excerpt has been republished with permission of Penguin Business.
India today is the largest recipient of Gates money outside the United States or Europe, of more than six hundred charitable grants totaling close to $1.5 billion. The foundation’s first-ever foreign office was in India, and its HIV/AIDS project, called Avahan, turned into a sprawling $300 million program, one of the foundation’s biggest interventions of its kind at that time. In the years ahead, the foundation dramatically expanded its portfolio of charitable interventions in India to include maternal health, vaccines, financial systems, and other topics.
But it was a slow learning process. Figuring out how to work in India, and the need to work cooperatively with the government, began with some hard lessons in its early HIV/AIDS project. Manjari Mahajan was a graduate student at the time Avahan was getting to the ground in the early 2000s, and she found that foundation staff in India were open to discussing their work—a level of transparency and engagement that seems unthinkable today. Mahajan, an associate professor in international affairs at the New School, went on to publish her findings about Avahan’s questionable legacy in academic journals. Forbes India reported a second, consistent account of the project.
According to these two reports, a defining feature of Avahan was its “go big or go home” ethos. Job interviews were held at some of the nation’s fanciest hotels, and the very high salaries on offer attracted corporate talent from consulting companies like McKinsey. The director of Avahan, Ashok Alexander, a former senior partner with McKinsey, became the highest-paid employee at the foundation in 2007, taking home nearly five hundred thousand dollars in total compensation.
Asked about the five-star hotels, business class flights, and high-grade salaries, the foundation noted at the time, “We need the best talent to deal with an urgent problem on a war footing. If we need to get this talent from the corporate sector, we have to make it attractive for them.” This meant hiring technical specialists at salaries three or four times higher than what government agencies were paying, setting the stage for a brain drain that attracted talented people who might otherwise have worked in the public sector. The foundation’s rich spending also prompted a wide array of NGOs to line up behind its agenda. Mahajan’s research proposes one group that changed its focus from adolescent health to follow Gates' money—and priorities.
By 2009, more than one hundred NGOs were working under the Gates Foundation’s growing HIV/AIDS project.
Outside Avahan, the Indian government already had a robust HIV/ AIDS program that other donors were working through, so, in some respects, the Gates Foundation was pursuing a parallel, independent strategy. And Gates was eager to contrast its approach with the Indian government’s, trumpeting how its hard-nosed, business-minded strategy would move the needle. “If an NGO becomes a barrier between providing a service to society, then we will get another NGO. We will short circuit the power structure to get the service to the people. We focus on speed, on scale, and on sustainability,” the director of Avahan said.“Our benchmarks are of the private sector. In the first year, we established our presence in 550 towns, with doctors, peer workers, and nurses. If we were a business organization, we would have been very proud of such rapid growth. We follow a business model with segmentation of the problem. Where in the social sector do you need such execution focus? Where do you need such structures of monitoring and evaluation?”
As the project got bigger and bigger, however, the Gates Foundation began to realize internally how minuscule its resources were in a nation of more than a billion people. And it realized that its silver bullet approach of devising succinct technical interventions wasn’t as easy as the elegant flowcharts its army of consultants and MBAs had devised on paper.
“They go in and they think distributing condoms and information is going to bring about behavioral change in the high- risk groups, especially sex workers,” Mahajan told me in an interview. “They find that it doesn’t work. So, they go back and try some other intervention, and that doesn’t work. They are partnering with all these NGOs, and so, they start listening more carefully to what these NGOs are saying, which is, ‘What good is it for a sex worker to have a condom if she is going to be beaten up by a customer if she tries to use it?’ So, they realize they have to understand the broader social and cultural dynamic.”
Mahajan said the Gates Foundation deserves credit for demonstrating its capacity to learn and pivot. Yet the lesson went only so far. While the foundation’s leadership came to realize its targeted interventions were too narrow, it also realized it didn’t want to take on the difficult, messy work of public health—building up the infrastructure and capacity of the nation to deliver the full scope of interventions needed against disease. “This type of broad-ranging structural work is not what we set out to do,” the foundation acknowledged. Gates began formulating an exit plan, imagining it would hand off Avahan to the Indian government. As part of this plan, it issued press releases and grants that fundamentally changed the program from one that worked outside the government to one that was now working closely with it. Mahajan reports that when she asked about the changing strategy, the foundation insisted that its plan had always been to hand the project off to the government.
Bill Gates had his own version of events. “One of the first programs we worked on in India was called Avahan, an HIV prevention program that’s now reaching millions of the people most at- risk for contracting and spreading the virus. With many international partners, we helped launch the project, refining it and measuring its impact along the way. After the first 10 years, the government of India has decided to take it over,” Gates said in 2012. “This is a great example of what collaboration between funders and governments can achieve. Avahan is saving lives, and it would not exist if we hadn’t provided funding and technical assistance to test out a promising new idea. However, the Indian government is scaling and sustaining the effort over the long-term. This pattern has been repeated across the country over the past several decades, and aid has steadily become a smaller and smaller portion of the national economy.”
The reality was nothing like the success story Bill Gates described. The Indian government deemed Avahan to be hugely expensive in terms of the benefits it delivered—and totally unsustainable. “We told them you can’t create a huge number of assets and then just leave and expect the government to take over everything,” the head of the Indian government’s HIV response effort told the news media. “We can never offer a replicable model. And if we are unable to sustain the programme, all of their effort will be for naught.”
“Avahan’s approach is too resource-intensive,” another Indian official noted. “This is not a model that can be replicated or scaled up by the state.”
One HIV activist from that era whom I interviewed echoed these sentiments, recounting to me having conversations with mid-level government employees along the lines of, “How does BMGF think they can just hand over such a huge thing, and they think we will want to take it up and run it? Where do we have the capacity to run it? Where do we have the people?”
Forbes India was unsparing in its final analysis of Avahan, headlining its story, “How Bill Gates Blew $258 Million in India’s HIV Corridor.” For all the foundation’s chest-thumping about its private-sector dynamism and hard-nosed business approach, from a dollars-and-cents perspective, Gates’s project seemed better defined by its wasteful spending and weak outputs. Avahan simply had not achieved what it had set out to do.
