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India: Choking foreign funds of NGOs to suppress dissent

11 June 2013

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[Posted below are articles by Praful Bidwai and Rama Lakshmi]

The News (Pakistan)

Choking funds to suppress dissent

by Praful Bidwai

Saturday, June 01, 2013

Perhaps no other country has as complex a maze of laws and rules – that give arbitrary powers to the state – as India. And no other state has abused them as comprehensively as India to censor free expression, curb dissent, criminalise protest, and harshly victimise people – so as to impose manifestly harmful decisions on them.

The maze includes scores of new laws (200, according to one estimate), in addition to the Indian Penal Code, Criminal Procedure Code and Indian Police Act, inherited from the colonial era.

One such law is the Foreign Contribution Regulation Act 2010 (FCRA), with which the government controls overseas funding of non-profit non-governmental organisations (NGOs) through an elaborate system of screening and scrutiny containing several exclusions with powers to suspend foreign-funding permits.

The FCRA’s origins lie in the emergency (1975-77) imposed by Indira Gandhi, partly out of her paranoid conviction that ‘foreign powers’ were out to destabilise her by instigating domestic political groups. The FCRA originally banned funding for political parties, election candidates, trade unions, the media, etc. All applicants for a permit to receive funding would have to be registered for at least three years and be closely screened by the intelligence bureau, no less.

It’s not easy to get an FCRA permit. The process usually takes a couple of years. Only 39,000 out of India’s two million-plus NGOs have such permits. Permits were originally granted for an indefinite period. But in 2010, the FCRA was amended and new rules were introduced. These debarred groups from ‘political actions’ and restricted permits to five years.

Under Rule 3(vi), the government can exclude any group that “habitually indulges in bandhs, hartals, rasta roko, rail roko, or jail bharo.” These are all non-violent democratic forms of protest, which emerged from India’s freedom struggle, and are recognised around the world as legitimate. Banning them is self-evidently discriminatory.

This rule can be used against any organisation which supports rights-based mobilisations of women, landless farmers, Adivasis, Dalits, students, religious minorities, and people affected by industrial, mining and irrigation projects.

The government has used the rule to refuse a permit to the NGO Prs Legislative Research, which analyses the functioning of parliamentary institutions and provides research assistance to MPs who ask for it. Some 250 MPs cutting across party lines use Prs, but the government doesn’t trust their integrity and regards the service as potentially subversive.

The home ministry last year cancelled the FCRA permits of some 4,000 NGOs citing minor technical grounds such as change of address. Some cancellations smack of a witch-hunt.

The worst case of abuse pertains to the Indian Social Action Forum (INSAF), a coalition of 700 organisations active in anti-communal mobilisations, anti-displacement struggles, and campaigns against destructive projects such as Posco, Koodankulam Vedanta, and Special Economic Zones.

On April 30, the home ministry suspended INSAF’s FCRA permit and froze its bank accounts claiming that its activities are likely to “prejudicially affect the public interest”, without stating which activities would do so. This violates FCRA’s stipulation that reasons for suspension must be ‘recorded in writing’. Two days later, it demanded answers to 31 queries – a case of ‘shoot first, ask questions later!’

INSAF has established itself as a platform where autonomous secular-democratic groups can pursue their common aims of “protecting democracy, resisting iniquitous forms of globalisation and combating communalism”. INSAF’s work has expanded the space for those affected by state policies and asserted their democratic right to intervene in and influence development policies.

INSAF has made important interventions in public debates, including land grabs by Indian companies in Africa, violations of statutory norms for mining and industrial projects, ‘black laws’ such as the Armed Forces (Special Powers) Act, and state violence against Dalits, Adivasis and minority religious groups.

INSAF was targeted because it’s a vocal critic of recent changes in the legal framework aimed at criminalising those who question the state’s authority and policies. It has consistently opposed human rights violations – whether by the state, corporations or political parties.

It is the only organisation to have petitioned the Indian Supreme Court against Section 13 of the FCRA that gives the government unbridled powers to silence organisations working for public causes by branding them ‘political’. Ironically, the government acted against INSAF under that very section!

This is part of a distressing pattern of criminalisation of dissent, evident in the state’s attacks on peaceful protesters, banning of satirical cartoons, and punishing people for Facebook and Twitter postings. The government has become especially intolerant of criticism after the recent anti-corruption mobilisations and protests against sexual assaults on women.

The mother of this intolerance is the union home ministry, run by ultra-conservative bureaucrats who are under the spell of intelligence agencies and take a hard line on matters ranging from fighting insurgencies, to putting citizens under surveillance, to outlawing ‘suspect’ (read, democratic) dissident activities.

It may seem paradoxical that restrictions on the freedom of expression and association have been tightened precisely when the government has liberalised the economy, embraced globalisation and opened up India to foreign investment, now considered ‘an imperative’. India is desperate to attract investment – no matter how dubious its source and whether or not it’s a form of money laundering routed through tax havens, which feed much of the current $40 billion-plus inflow.

If the government is concerned about political abuse of foreign funds, it’s hard to explain why it has created one of the world’s “most liberalised investment regimes” for the media, according to the Federation of Indian Chambers of Commerce and Industry. This funnelled some $2.2 billion in foreign funds into that industry in 2010-11 (and probably much more since).

The media is part of the political process and influences public opinion. The ‘foreign hand’ should be an obvious concern in this sensitive industry, which is distorting India’s public discourse. Instead of regulating investment, the government is targeting progressive NGOs through the FCRA.

This violates Article 14 of the constitution, which is against discrimination and unequal treatment, and Article 19, which guarantees freedom of expression and association. The arbitrary powers that the FCRA bestows on the government make nonsense of natural justice and public accountability.

The FCRA, says a study by the Institute of Rural Management Anand, “is an ineffective legislation as it controls ... only about two percent of the total foreign funds that come into the country. If the FCRA is meant to deal with ... anti-national and unlawful elements... then the focus should be on devising a proper mechanism to identify and curb such malpractices rather than penalising genuine organisations.” Further, foreign investment into the industry has been liberalised; “but the same spirit is not followed while dealing with voluntary sector organisations...”

In reality, there is no contradiction between economic liberalisation or greater freedom for capital, and curbs on citizens’ freedoms. Corporate-led globalisation is predatory on people’s fundamental rights. It breeds inequalities and injustices. Popular protests are a natural reaction to these.

The government has devised elaborate ways of repressing protests, including refusing visas to scientists who warn of potential earthquakes near nuclear sites like Jaitapur, summarily deporting anti-displacement activists, and making absurd rules about obtaining prior permission for holding international conferences, which is rarely granted in time. The FCRA is only one, blunt, instrument in its armoury. It must go, with other abuse-prone measures.

The writer, a former newspaper editor, is a researcher and peace and human-rights activist based in Delhi Email: prafulbidwai1 at

o o o

The Guardian (UK)

India cracks down on foreign funding of NGOs

Activists accuse government of stifling their right to dissent

by Rama Lakshmi for the Washington Post

Amid an intensifying crackdown on non-governmental groups that receive foreign funding, Indian activists are accusing the government of stifling their right to dissent in the world’s largest democracy.

India has tightened the rules on non-governmental organisations over the past two years, following protests that delayed several important industrial projects. About a dozen NGOs that the government said engaged in activities that harm the public interest have seen their permission to receive foreign donations revoked, as have nearly 4,000 small NGOs for what officials said was inadequate compliance with reporting requirements.

The government stepped up its campaign recently, suspending the permission that Indian Social Action Forum (Insaf), a network of more than 700 NGOs across India, had to receive foreign funds. Groups in the network campaign for indigenous peoples’ rights over their mineral-rich land and against nuclear energy, human rights violations and religious fundamentalism; nearly 90% of the network’s funding comes from overseas.

"The government’s action is aimed at curbing our democratic right to dissent and disagree," said Anil Chaudhary, who heads an NGO that trains activists and is part of the Insaf network. "We dared to challenge the government’s new foreign donation rules in the court. We opposed nuclear energy, we campaigned against genetically modified food. We have spoiled the sleep of our prime minister."

In its letter to Insaf, the home ministry said the group’s bank accounts were frozen and foreign funding approval suspended because it was likely to "prejudicially affect the public interest".

A government official, who spoke on the condition of anonymity because of the sensitivity of the subject, said the government is not against criticism. But when an NGO used foreign donations to criticise Indian policies, "things get complicated, and you never know what the plot is", the official said, adding that NGOs should use foreign donations to do development work instead.

The US is the top donor nation to Indian NGOs, followed by Britain and Germany, according to figures compiled by the Indian government, with Indian NGOs receiving funds from both the US government and private US institutions. In the year ending in March 2011, the most recent period for which data is available, about 22,000 NGOs received a total of more than $2bn from abroad, of which $650m came from the US.

Asked about the Indian government’s moves against foreign-funded NGOs, a US state department spokesman said the department was not aware of any US government involvement in the cases. The spokesman said such civil society groups around the world "are among the essential building blocks of any healthy democracy".

The situation in India is not unlike the problems that similar groups face in Russia, where a law passed last year requires foreign-funded NGOs that engage in loosely defined political activities to register as "foreign agents".

Trouble for many non-profit activist groups in India began more than a year ago when prime minister Manmohan Singh blamed groups from the US for fomenting anti-nuclear protests that have stalled the commissioning of India’s biggest reactor, a Russian-backed project in Koodankulam in power-starved Tamil Nadu state.

US officials, including Peter Burleigh, the American ambassador at the time, quickly moved to assure Indian officials that the US government supports India’s civil nuclear power programme. And Victoria Nuland, then the state department spokeswoman, said the US does not provide support for non-profit groups to protest nuclear power plants. "Our NGO support goes for development, and it goes for democracy programmes," Nuland said.

Although Singh was widely criticised for his fears, the government froze the accounts of several NGOs in southern India within weeks.

"All our work has come to a stop," said Henri Tiphagne, head of a human rights group called People’s Watch. "I had visited [the] Koodankulam protest site once. Is that a banned territory?"

But the government’s action appears to have had its desired effect. "NGOs are too scared to visit Koodankulam or associate with us now," said anti-nuclear activist SP Udayakumar.

Meenakshi Ganguly, south Asia director of Human Rights Watch, said many NGOs were afraid to speak up about the suspension of their foreign funding approval, which is "being used to intimidate organisations and activists".

Analysts say the government’s way of dealing with dissent is a throwback to an earlier era. But Indian authorities have been particularly squeamish about criticism of late. As citizens have protested corruption and sexual assaults on women and demanded greater accountability from public officials, authorities have often reacted clumsily – beating up peaceful protesters and cracking down on satirical cartoons, Facebook posts and Twitter accounts.

Officials say NGOs are free to use Indian money for their protests. But activists say Indian money is hard to find, with many Indians preferring to donate to charities.

A recent report by Bain & Co said that about two-thirds of Indian donors surveyed said that NGOs have room to improve the impact they are making in the lives of beneficiaries. It said that a quarter of donors are holding back on increased donations until they perceive evidence that their donations are having an effect.

"They give blankets to the homeless, sponsor poor children or support cow shelters," said Wilfred Dcosta, co-ordinator of Insaf. "They do not want to support causes where you question the state, demand environmental justice or fight for the land rights of tribal people pitted against mighty mining companies."

Insaf, whose acronym means "justice" in Urdu, has seen its portion of foreign funding increase significantly during the past 15 years. Now it receives funds from many international groups, including the American Jewish World Service and Global Greengrants Fund in the US, and groups in Germany, Switzerland and the Netherlands.

The top American donors to Indian NGOs include Colorado-based Compassion International, Washington DC-based Population Services International and the Bill and Melinda Gates Foundation.

"It is not a question about money, it is a fight for our right to dissent," said Chaudhary. "I don’t need dollars to block a road."

This article appeared in Guardian Weekly, 11 June 2013, which incorporates material from the Washington Post


The above article are reproduced here for educational and non commercial use