6,000 NGOs could lose foreign funding in India

Licenses may be suspended for errant

News - India & You


July 12, 2017

/ By / Kolkata

Close to 6,000 organisations could lose foreign funding license

Close to 6,000 organisations could lose foreign funding license

In a crackdown on organisations that have failed to file their annual returns for five years in a row, a circular by the Ministry of Home Affairs, Government of  India has been issued regarding suspension of license of foreign funding.

In a country where foreign investment has taken centre stage while pushing for developmental projects, non-governmental organisations (NGOs) and other associations are increasingly under the scanner for the foreign funding they receive. As close to 5,922 NGOs and associations have been listed by the home ministry for failing to disclose and file income and expenditure records for five consecutive years, these parties on the list stand a threat of losing their license to receive foreign funding. These organisations include prominent educational, heritage and charity trusts.

A show cause notice has been issued to these NGOs and associations by the Foreign Contribution Regulation Act (FCRA) division under the Home Ministry that has demanded justification for non-cancellation of the said license. According to the division, several notices have been issued, repeatedly to ensure that these organisations comply with the mandatory filing. However, from the 2010-11 to 2014-15 financial years, the organisations on the list have allegedly failed to provide the necessary details.

According to the circular, as a one-time measure, one month had been issued to all NGOs to file their missing annual returns, with June 14 as a deadline to avoid any penalty. “However, in spite of sufficient and adequate notice, it has been observed that 5,922 associations have not uploaded their annual returns for three or more than three years within the stipulated time given in the notice,” the circular said. The associations have now been asked to furnish their replies, if any, by July 23, failing which it will be presumed that they have nothing to say and action as proposed will be taken by the home ministry as per FCRA, the circular said.

Since the laws relating to establishment of organisations, “not for profit” entities encompass a wide variety of activities, the list reflects the same. Among some of the notable educational enterprises on the list are Indira Gandhi National Centre for Arts, IGNOU, Nehru Memorial Museum and Library, Indian Institute of Technology-Kanpur and Mayo College Central Council Society, who could all lose their foreign funding licenses. Other prominent associations include the spiritual societies such as Ramakrishna Mission Ashram, Mata Vaishno Devi Shrine Board as well as the international organisation, Oxfam Trust.

Foreign funding and NGOs – an unfavourable alliance

While this round of notifications from the government to NGOs seems to have emerged from a valid reason, over the past two years, thousands of NGOs have had their registrations cancelled as well as licenses from foreign bodies suspended. In December last year, reports surfaced that at least 25 Indian NGOs had lost licenses to receive international funding because of their “anti-national” activities.

Additionally, an estimated 11,319 reportedly lost licenses for failing to renew them. This had led to reduction to the shrinking of India’s pool of foreign-funded organisations to a little more than half the number it was two years ago. With the recent list on the technical failings of the listed organisations, perhaps some of the defaulters will add to the decrease of foreign funded NGOs.

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