Indian charity law could force NGOs into crisis

October 13, 2020

Original Article in Arab News 13th October, 2020

Thousands of small NGOs that are dependent on legal funds obtained internationally may be ending soon.

Many small NGOs questioned the timing of the new legislation, as they have been heavily involved in providing relief to millions of people during the COVID-19 pandemic

NEW DELHI: A new law passed by India’s parliament on Wednesday imposes restrictions that will force thousands of NGOs to shut down, dealing a major blow to the country’s civil society, activists say.

The Foreign Contribution (Regulation) Act (FCRA) 2020, which regulates the use of foreign funds by individuals and organizations, is “for national and internal security” and to “ensure that foreign funds do not dominate the political and social discourse in India,” Nityanand Rai, junior home minister, told the upper house as it passed the regulation on Wednesday.

But Indian NGOs fear that the law will mean they are no longer able to operate.

“Thousands of small NGOs, which enable good work and are dependent on legal funds obtained internationally, will shut down — also endangering the livelihoods of those dependent on them for a vocation,” Poonam Muttreja, director of the Delhi-based Population Foundation of India, told Arab News.

As the new law does not allow NGOs to share funds with any partner, individual or organization, small groups — particularly those active at the grassroots level — may end up being unable to receive the donations on which they depend for survival, Muttreja warned.

“Donors can’t give small grants to local NGOs, so they give large grants to an intermediary organization with the desire to work with grassroot-level NGOs, (of which there are many) in India,” Muttrejia said.

On Thursday, Voluntary Action Network India (VANI) — an umbrella organization for Indian NGOs — held a press conference during which members questioned the timing of the new legislation, since many small NGOs have been heavily involved in providing relief to millions of people across the country during the COVID-19 pandemic.

“This is the worst possible time to hamper civil society,” the director of Ashoka University’s Center for Social Impact and Philanthropy, Ingrid Srinath, said during the conference. “Just when this country needs its entire civil society to work together with the private sector and the government to address the multiple problems that confront us — not only the health ones but the larger issues of where the economy is going and the many polarizations taking place on the ground.”

Srinath also pointed out that no wider consultation with NGOs had taken place before the law was passed.

According to Delhi-based civil society activist Richa Singh, the law is an attempt by the government to silence dissent in the country.

“The larger purpose is to further silence those civil societies that are critical of (the government). It is a political message to fall in line,” she told Arab News. “While foreign money in the form of investment is being welcomed and labor laws are weakened for it, aid money is selectively targeted.”

Amitabh Behar, the chief executive of Oxfam India, called it a “devastating blow” and also criticized the government’s double standards over the acceptance of foreign funds.

“Red carpet welcome for foreign investments for businesses but stifling and squeezing the nonprofit sector by creating new hurdles for foreign aid which could help lift people out of poverty, ill health and illiteracy,” he said in a Twitter post on Sunday, when the FCRA bill was introduced to the lower house.

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