Truth behind of Indian NGO


Sanjeev Nayyar 
It is time the government woke up to the risks that uncontrolled foreign monies flowing to Indian NGOs pose to India’s economic progress, social cohesion and national integrity.
 

PM wakes up to dollar driven NGO threat, screamed a newspaper headline. The government has cancelled licenses of three such organisations for diversion of funds to fuel anti-nuclear protests in India.This decision has once again put the spotlight on foreign funding of NGOs. A close perusal of the FCRA Report published by the home ministry reveals billions of dollars received by NGOs in India.

Before analysing the latest FCRA report a bit about the regulatory framework for NGOs to receive foreign money.

The Foreign Contribution Regulation Act was passed in 1976. It was repealed and FCRA 2010 was passed along with the Foreign Contribution Regulation Rules 2011. Both became effective from May 1 2011.

They seek to regulate the receipt of funds by NGOs. The FCRA is managed by the Ministry of Home Affairs (MHA).

Any organisation that wants to receive contributions from abroad has to apply and get approval from the home ministry. All remittances are received into a single bank account of a scheduled bank or through such branches as may be specified.

If an NGO, whether registered or not, receives a contribution in excess of Rs 1 cr (rs 10 million) during a period of 30 days, the bank has to report this to the central government within 30 days of the date of such last transaction.

The NGO has to annually submit audited receipts, payments account, balance sheet etc to the ministry. The MHA scrutinises the returns to ensure that contributions received for a particular purpose are used for that purpose only. It does a detailed check of randomly picked associations and collates the data received to present the FCRA Annual Report [uploaded on http://mha.nic.in/fcra.htm].

The associations could be religious, social, educational, cultural or educational organisations. MHA wants to ensure that foreign contributions are utilized for bona fide activities and do not compromise national security.

The FCRA report for the year ended 31st March 2010 was published on 11th January 2012 i.e. 21 months after year end.

Trends in foreign contributions
Indian NGOs received a staggering Rs 94,520 cr (Rs 945.20 billion) from 1993-94 to 2009-10.
As on 31.3.2010, there were 38,436 registered associations, up 5.5 per cent from the previous year, 27 per cent when compared to 2004-05 and 68 per cent as compared to 2000-01. Clearly the number of registered NGOs that receive dollars has seen a huge surge in the last decade.
Year
Registered Associations (as on 31st March of F.Y.)
Associations that gave details of remittances received
Amounts received Rs crs
1993-94
15,039
Not Available
1865
2000-01
22,924
64%
4535
2003-04
28,351
61%
5105
2004-05
30,321
61%
6257
2005-06
32,144
58%
7878
2006-07
33,937
56%
11,336
2007-08
34,803
54%
9,663
2008-09
36,414
55%
10,803
2009-10
38,436
56%
10,338
Total 1993-94 to 2009-10
94,520
$ Billion
18.90
All numbers in this article are reproduced from FCRA reports published by the MHA. Assumed an exchange rate of Rs 50 to a dollar and all figures rounded off to the nearest crore in article.
In 2009-10, 7,275 of the 21,508 associations who submitted their accounts did not receive any foreign contributions. This means that only 46 per cent of the associations who received foreign contributions filed their annual returns with MHA.Hence, the actual amount of contributions received by NGOs would be much higher than Rs 10,338 cr (Rs 103.38 billion) reported above.
Is such unreported contribution being used for money laundering, terrorist activities or funding protests as mentioned by Prime Minister Singh?
During the year, 21,000 defaulter associations which had not submitted returns for the years 2006-07, 2007-08, 2008-09 were issued Show Cause Notices. We are already in the first quarter of 2012.
By the time these NGOs reply to the notices and the government decides what action to take against them, the NGOs might receive many more crore with zero accountability to the government.
Largest donors country wise (in Rs cr)
Year
USA
Germany
UK
Italy others
2002-03
1680
715
685
NA
2003-04
1584
757
676
350
2004-05
1927
931
764
353#
2005-06
2426
1181
1062
500
2006-07
2949
1033
1428
606&
2007-08
2928
971
1269
515
2008-09
3433
1103
1131
547
2009-10
3106
1046
1039
583
Total
20,033
7,737
8,054
3,454
$ Billion
4.0
1.55
1.61
Italy, #Netherlands, & Switzerland.The top three donor countries for many years have been USA, Germany, and UK. Remittances from the U.S. between 2002-03 and 2009-10 have nearly doubled. Despite the economic downturn, the West has continued contributions to Indian NGOs? Why?

Key Donors: Country wise Trends (in Rs cr)
Country
2009-10
  Country
2008-9
Country
2007-8
USA
3106
USA
3433
USA
2928
Germany
1046
UK
1131
UK
1269
UK
1039
Germany
1103
Germany
971
Italy
583
Italy
547
Italy
515
Netherlands
509
Netherlands
513
Netherlands
414
Spain
437
Spain
437
Spain
401
Switzerland
302
Switzerland
370
Switzerland
364
Canada
298
Canada
303
Canada
276
France
189
France
193
France
196
Australia
148
Australia
131
Australia
138
UAE
133
Belgium
124
Belgium
100
Belgium
122
Austria
106
Austria
99
Austria
112
Sweden
103
Sweden
89
Sweden
106
UAE
146
UAE
79
Mauritius
101
Ireland
69
Ireland
77
Should a country that aspires to be a superpower continue to receive billions of dollars as charity every year? Spain and Italy are in dire economic straits, Britain had a fiscal deficit of 11% of GDP in 2009-10 yet they remitted over Rs 1000 crs to Indian NGOs per annum.
Significantly, barring the UAE, all countries listed above belong to the West. Media reports indicate that some countries in the Middle East, notably Saudi Arabia, made large remittances to India, but these contributions are not listed officially. They are either not coming, or are coming through the hawala route.
Largest donors: Agency wise trends (in Rs cr)
Donor Name & Country
2009-10
Donor Name & Country  
2008-09
Gospel For Asia Inc USA
233
World Vision  International USA
706
Fundacion Vicente Ferrer, Barcelona, Spain
229
Gospel For Asia Inc USA
596
World Vision Global Centre, USA
198
Fundacion Vicente Ferrer, Barcelona, Spain
458
Compassion International, USA
132
Shyam Shyam Dham Samiti India
359
HCL Holdings Pvt Ltd, Mauritius
94
Compassion International, USA
347
Om Foundaiton, USA
64
Fundacion Vicente Ferrer, Spain
241
Population Service International, USA
51
Action Aid International, UK
228
Oxfam GB, UK
45
BAPS, Inc USA
199
Save The Children, UK
44
Christian Children Fund, USA
197
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