Civil society organisations should count on their huge social capital


    In Context

    • The challenges that civil society organisations (CSO) in India face are new and enduring.

    About the Civil Society Organizations in India

    • About:
      • India has a long history of civil society based on the concepts of daana (giving) and seva (service). 
      • Civil society organization (CSO) or non-governmental organization (NGO) are the organizations that are voluntary in spirit and without profit-making objectives—have been active in cultural promotion, education, health, and natural disaster relief. 
    • Data on NGOs:
      • Today, about 1.5 million NGOs work in India (i.e., nonprofit, voluntary citizens’ groups organized on a local, national, or international level). 
        • According to a survey conducted by Society for Participatory Research in Asia (PRIA)
          • 26.5% of NGOs are engaged in religious activities
          • while 21.3% work in the area of community and/or social service
          • About one in five NGOs works in education
          • while 17.9% are active in the fields of sports and culture
          • Only 6.6% work in the health sector.

    About Foreign Contribution (Regulation) Act (FCRA)

    • Background: 
      • The FCRA was enacted during the Emergency in 1976 amid apprehensions that foreign powers were interfering in India’s affairs by pumping money into the country through independent organisations.
      • These concerns were, in fact, even older; they had been expressed in Parliament as early as in 1969.
    • Aim: 
      • The law sought to regulate foreign donations to individuals and associations so that they functioned in a manner consistent with the values of a sovereign democratic republic.

    FCRA regulations for the Civil Society Organizations in India

    • Tighter control:
      • The Foreign Contribution (Regulation) Act was amended by the current government in 2020, giving the government tighter control and scrutiny over the receipt and utilisation of foreign funds by NGOs. 
    • Designated FCRA account: 
      • All NGOs seeking foreign donations have to open a designated FCRA account at the SBI branch.
      • The NGOs can retain their existing FCRA account in any other bank but it will have to be mandatorily linked to the SBI branch in New Delhi.
    • Only banking channels allowed: 
      • Foreign contribution has to be received only through banking channels and it has to be accounted for in the manner prescribed.
    • OCI or PIO: 
      • Donations are given in Indian rupees by any foreign source including foreigners of Indian origin like OCI or PIO cardholders” should also be treated as foreign contributions.
    • Sovereignty and integrity: 
      • It requires NGOs to give an undertaking that the acceptance of foreign funds is not likely to prejudicially affect the sovereignty and integrity of India or impact friendly relations with any foreign state and does not disrupt communal harmony.

    Challenges & criticisms

    • Related to FCRA regulations:
      • No voice for NGOs:
        • FCRA laws are criticised for throttling voice of NGOs and ending the scope for popular global causes such as environmental issues, ensuring rights for forest dwellers or capacity building of most marginalised. 
        • Advocacy-based institutions are most likely to be hit by new laws.
      • Joblessness in SCOs:
        • Thousands working in the social sector, particularly in grassroots organisations, have already been rendered jobless as the ban on sub-granting has caused resource starvation for these organisations.
      • Draining of resources:
        • There are also talks doing the rounds that civil society should collectively challenge the new laws. 
        • But most of them are wary of fighting this long battle legally as many of them who have lost their licenses have already drained their resources and are finding it difficult to pay the pending salaries of their staff.
      • Challenge of localisation:
        • In the current scenario, the prominent challenge is localisation. The initiation of the fight for rights is strongly rooted in the factors at the local level. It requires local leadership.
    • Other Challenges:
      • No depiction of vulnerable children:
        • Recently, the government has warned CSOs against using representative visuals for fundraising activities concerning development issues such as malnutrition. 
        • The National Commission for Protection of Child Rights (NCPCR) issued a directive to non-profits not to depict vulnerable children. 
        • So, every new directive is a new challenge for civil society.
      • Structural deficiencies:
        • Many CSOs need to ramp up clear governance structures and policies. Without these structures, it can be difficult to maintain accountability and ensure that resources are used effectively.
        • Many CSOs lack the skills and resources to create and maintain professional management systems.
      • Societal misinterpretations:
        • CSOs often face misconceptions about their role in society. They are the targets of political interference and manipulation, which can limit their ability to operate. 


    • For government:
      • The governments should also realise that some of its prominent acts or laws, such as the Right to Information Act, The Protection of Children from Sexual Offences Act and the National Food Security Act, among others, will remain relevant if the foundations of civil society are strong.
        • Any attempt to disturb civil society will be tantamount to diluting these laws
      • Any stringent measures would also adversely impact the monitoring of the implementation of various government schemes, such as the Mahatma Gandhi National Rural Employment Guarantee Act, the Pradhan Mantri Awas Yojana and the Pradhan Mantri Jan Dhan Yojana, etc.
    • For NGOs:
      • Alternate ways of funding:
        • Post new FCRA laws, many organisations have already started looking up to local resource mobilisation (LRM) and are largely focused on corporate funding through corporate social responsibility (CSR).
      • Charitable funding:
        • Civil society should explore how to encourage more collective giving, a form of charitable giving where groups pool their donations to create larger funds to tackle problems.
      • Utilizing technology:
        • There is increasing awareness that increased use of data and digital technology can make charities stronger and even better at what they do. 

    Way ahead

    • The collectivisation of national-level forums for supporting marginalised communities through the articulation of their needs, empowering identity or voices and deconstructing the old arrangements that have failed in performance and ideation is the way forward.


    Daily Mains Question

    [Q] The challenges that civil society organisations (CSO) in India face are new and enduring. Enumerate. Suggest ways for CSOs to effectively deal with these challenges.