Why civil society matters

NGOs should be transparent, but the Union government must not impose restrictions

The Lok Sabha has passed the Foreign Contribution (Regulation) Amendment (FCRA) Bill, 2020 regarding nongovernmental organisations (NGOs) without debate, which is unfortunate. NGOs are not without their problems, but the estimated three million such bodies that exist in India are a vital and important element of civil society. Many of them implement and monitor the government’s welfare policies, operating at the grassroots level where the official apparatus is often non-existent. They also provide a voice to marginal groups and social movements, offering a safety valve that prevents the country’s millions of local mutinies from becoming uprisings. NGOs functioned for decades with thin or nonexistent regulations. Self-proclaimed societies were not required to register, and trusts and religious foundations functioned without transparency and financial auditing. The introduction of the Section 25 non-profit company, aligning NGO finances and management with those of a normal firm, was a crucial reform. The new legislation should have moved further on this path. Instead, the new FCRA amendments obsess about the flow of foreign fund to such bodies. No one can question the need for NGOs to be transparent about their sources of funding, whether foreign or domestic. But there is a thin line between enforcing transparency and using rules to allow official interference and harassment in the sector. Much of the present bill crosses that line and moves toward a licence-raj on NGOs. NGOs are a heterogeneous category. Regulations regarding NGOs, therefore, should be about basic principles and requirements. The bill introduces a questionable degree of micro-management. An NGO should be required to state how much it spends on administration, but the level of spending should not be a government concern. Restricting inter-NGO money transfers ignores that many NGOs are funding bodies or sub-contract their operations to other NGOs. And that funding should be routed through a specified bank branch has little logic. The Right-wing has, wrongly, constructed foreignfunded NGOs as a threat. While some excesses have been rightly curbed, if this is marked by political vendetta, it will open the doors for all forms of harassment, of all kinds of organisations, under different regimes. The government should send the bill to a select committee of the Rajya Sabha. NGOs are a necessary component of civil society and this bill needs greater public debate and scrutiny.