Breather for NGOs

FCRA relaxations offer only partial relief

The raft of modifications announced Friday to the Foreign Contribution (Regulation) Act (FCRA), which governs the funding of non-governmental organisations (NGOs), are welcome after the escalating restrictions on the sector since 2015. After the licences of some 6,000 NGOs lapsed on January 1 this year, the bulk of them voluntarily, on account of stringent restrictions on donations and spending rules, the government extended to September 30 the validity of FCRA entities whose five-year permits would lapse between July 1 and September 30 and had applied or would apply for renewal in this period.

The home ministry has also raised the limit that entities can receive from relatives abroad from Rs 1 lakh to Rs 10 lakh without informing the government and has extended the disclosure period for donations above that from 30 to 90 days. That apart, the time limit for applying for FCRA registration or prior permission to receive donations has been extended from 30 days to 45 days. Likewise, details such as change of address, bank account, and names of key members of the organisation need to be notified in 45 days instead of 15. The onerous requirement on declaring details of foreign donors every quarter has been reduced to once a year. And the stipulation that only 20 per cent of foreign funds could be used for administrative purposes has been extended to 50 per cent.

Taken together, these amount to significant relaxations for a sector that saw a considerable ratcheting up of scrutiny, reporting requirements, and spending rules from November 2020, a move that grabbed headlines with the rejection of the Missionaries of Charity’s licence on the basis of a police complaint in Gujarat (it was later reinstated). Although these relaxations will go some way towards easing the regulatory burden for NGOs, they do not significantly improve the ease of operating environment for NGOs, which are prey to arbitrary rules. The relaxation of the donation threshold, for instance, from foreign “relatives” is inadequate, given the scale of funds that NGOs, especially rights-based ones, need to function efficiently. The principal problem is that NGOs tend to hold a mirror to the government, a circumstance that unsettles thin-skinned leaders of dominant proclivities — whether it is mobilising protests against nuclear power plants under the United Progressive Alliance or the citizenship law and farm laws under the current government.

It is interesting, for instance, that the November 2020 rules stated that NGOs could not be linked to a political party but would be considered “political” in nature if they engage in “political actions” such as bandh, strikes, or road blockades. This proscription covers organisations espousing the cause of farmers, students, and workers, and those that are caste-based. If the government’s motives are transparent, such rules run contrary to the commitments to free speech and the defence of democratic rights that the prime minister recently made in several global fora. They are also counter-productive since NGOs and civil society play an important role in a country like India in defending the interests of the poor, the hungry, and the disenfranchised. These are, after all, goals to which every government voted to power commits itself to.