Non-Governmental Organizations (NGOs)

Non-Governmental Organizations (NGOs)

 

Introduction

Non-Governmental Organizations (NGOs) are legally established non-profit organizations that strive for social good and social justice. They have carved out a key role in civic society. NGOs, with government assistance, have accelerated their development operations by focusing on specific topics such as poverty alleviation, casteism and discrimination, women's rights, child labour, rural development, environmental challenges, and so on.

 

Origin of Term

The term “Non-Governmental Organization” or NGO, came into existence in 1945 because of the need for the UN to differentiate in its Charter between participation rights for intergovernmental specialized agencies and those for international private organizations.

 

Non-Governmental Organizations - Historical Background

  • With the commencement of social reform movements in the first part of the 19th century, the concept of voluntary organizations entered Indian society for the first time.
  • Reform movements instilled the idea of dedicating one's life to helping the most vulnerable members of society. These movements recognised women's and untouchables' rights.
  • The second part of the nineteenth century witnessed the rise of institutionalized reform groups such as Brahmo Samaj, Arya Samaj, Ramakrishna Mission, and others.
  • As a result, the government enacted the Societies Registration Act of 1860.
  • Between 1900 and 1947, effective efforts were undertaken to utilize the volunteer spirit into political activity and mass mobilization in order to achieve independence from the harsh colonial authority.
  • During the post-independence period, there were many volunteer organizations active in the process of nation-building.
  • The transition to neo-liberal economic and political planning resulted in the rapid expansion of voluntary organizations.

 

Non-Governmental Organizations - Concept

  • These are not for profit organizations that work to alleviate suffering, promote the interests of the poor, protect the environment, provide basic social services, work on human rights issues, or help the communities to develop.
  • The term NGO in India denotes a wide spectrum of organizations which may be non-governmental, quasi or semi governmental, voluntary or non-voluntary etc.
  • These organizations are not a part of the government, have a legal status and are registered under the Societies Registration Act, 1860.
  • Constitutional Provision: Article 43 emphasizes the state's objectives and the aim of fostering rural cooperatives. The freedom to create associations is covered under Article 19 (1)(c).

○In Entry 28, the Concurrent List includes Charitable Institutions, Charity, Religious and Charitable endowments, and Religious Songs Institutions.

  • Governments, foundations, businesses, and private individuals may all contribute to the funding of non-governmental organizations (NGOs).
  • These are vital to the development of society, the improvement of communities, and the promotion of citizen participation.
  • Indian NGOs mainly come under three segments; that are societies, trusts, charitable companies.
  • NGOs have played an increasingly important role in the development of the social sector, including education, health, and other areas, over the previous two decades.

 

Types of NGOs:

NGO can be classified on the basis of their orientation and level of operation.

  • Charitable Orientation: It involves a top-down effort with very little participation by the “beneficiaries”. It includes NGOs with activities directed toward meeting the needs of the poor -distribution of food, clothing or medicine; provision of housing, transport, schools etc. Such NGOs may also undertake relief activities during a natural or man-made disaster.
  • Service Orientation: It includes NGOs with activities such as the provision of health, family planning or education services in which the NGOs participate in the designing, implementation of programmes as well as in receiving the service.
  • Participatory Orientation: It is characterized by self-help projects where local people are involved, especially in the implementation of a project by contributing cash, tools, land, materials, labour etc. The participation begins with the need and continues into the planning and implementation stages. Cooperatives often have a participatory orientation.
  • Empowering Orientation: These NGOs aim to help poor people develop a clearer understanding of the social, political and economic factors affecting their lives. Sometimes, these groups develop spontaneously around a problem or an issue, while at other times, outside workers from NGOs play a facilitating role in their development. There is maximum involvement of the people with NGOs acting as facilitators.

 

Need of NGOs

  •  It acts as a two-way communication channel i.e. upward from people to the government and downward from the government to people. Upward Communication involves informing the government about the views of local people while downward communication involves informing local people about what the government is planning and executing.
  •  It enables people to work together voluntarily to promote significant social civic values. They promote local initiative and problem solving. Through their work in a broad array of fields – environment, health, poverty alleviation, culture & the arts, education, etc. NGOs reflect the diversity of society itself. They also help the society by empowering citizens and promoting change at the “grass roots”.
  • It brings social issues to the fore and thus acts as a spokesperson for the poor. They adopt various means to increase awareness among people leading to more and more participation from people. Thus, influencing government decision-making on people’s behalf.
  • With the help of NGOs, government officials mingle with private individuals to find solutions to various societal problems. This allows for smooth functioning due to involvement of locals at all levels i.e., from policy making to policy implementation. Also, more involvement of people increases transparency and thus reduces corruption at all levels.
  •  It plays a critical role in promoting intercommunity harmony and authorities often take their help to manage riots and hostile situations. Apart from it NGOs also play a positive role in assisting in relief work undertaken by the government during natural and man made disasters.

 

Laws and Financial Regulations for NGOs in India

Foreign Contribution (Regulation) Act (FCRA), 2010:    

  • Foreign funding of voluntary organizations in India is regulated under FCRA act and is implemented by the Ministry of Home Affairs.
  • The acts ensure that the recipients of foreign contributions adhere to the stated purpose for which such contribution has been obtained.
  • Under the act organizations are required to register themselves every five years.
  • In 2016, the government revised the FCRA, 2010 to exclude donations from foreign firms (with a 50% ownership) to non-profit organizations, political parties and candidates running for office, publications, government personnel, and so on from the definition of foreign source.

Foreign Exchange Management Act, 1999:          

  • It aims to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance of foreign exchange market in India.
  • A transaction under FEMA is called a fee or a salary while the same under FCRA is called a grant or a contribution.
  • In 2016, the powers of the Ministry of Finance to monitor NGOs were placed under the FEMA. The idea was to bring all NGOs, which receive foreign contributions, under one umbrella for better monitoring and regulations. The step was taken to ensure only one custodian monitors flow of foreign funds to these organizations.

Drawbacks of NGOs

  • Restricted funding: NGOs frequently lack funding, which can make it challenging to deal with complex social, economic, and environmental challenges.
  • Dependency on Outside money: Nongovernmental organizations (NGOs) are dependent on outside funding from donors, which can be unstable and uncertain, resulting in financial instability and challenges in implementing long-term programmes.
  • Lack of transparency and accountability: Certain NGOs could not be transparent or accountable, which can result in fraud and financial abuse.
  • Restricted Reach: NGOs frequently have a small audience and may not be able to deal with major concerns.
  • It can result in ineffective interventions or have little effect.
  • NGOs may be at risk for corruption, especially if they operate in nations with deficient governance structures.
  • A lack of cooperation and coordination among NGOs may exist, which can lead to inefficiencies and missed opportunities.

 

Challenges faced by NGOs in India

  •  Some NGOs have acquired the character of MNCs because of large scale funding from foreign governments, companies. On the other hand, a large chunk of NGOs lack even operational funding.
  • NGOs are becoming safe heavens to channelise the black money, tax evasion. Such NGOs are causing loss to the exchequer by helping others to evade taxes.
  •  It is estimated that only about 1.5 percent of NGOs in India actually undertake developmental work.
  •  Some NGOs in India are involved in political activism with foreign funds. A large proportion of NGOs have actively taken part in political campaigns, including working as proxies for certain political parties.
  •  Claiming involvement in human rights initiatives or social empowerment, these organizations are allegedly fronts for foreign supported extremist and secessionist groups. A large part of these funds is also being used for religious conversions, which is forbidden under the FCRA.
  •  Many NGOs in India suffer from the lack of a cohesive, strategic plan that would facilitate success in their activities and mission. This renders them unable to effectively raise and capitalize on financial support.
  •  A lack of effective governance is all too common in NGOs in India. Many have a deficit of understanding as to why they must have a Board and how to set one up. A founder may be too focused on running the NGO for their own purposes; however, governance is foundational to transparency.
  • Lack of Volunteerism/Social work among Youth due to less attractive career opportunities and pay scales. Even parents also discourage their children from social activities.
  • Centralisation in Urban and metropolitan areas.

 

Way forward

  •  The erstwhile Planning Commission had drafted the National Policy on the Voluntary Sector 2007 and had come up with a set of guidelines set forth in the Eleventh and Twelfth Five Year Plans for the sector.
  •  Intermediary organizations such as rating agencies could definitely be beneficial in building a robust voluntary sector.
  •  National Accreditation Council of India or NACI needs to be established with balanced participation from both government and voluntary sector for transparency and accountability.
  • Recently, the role of NGOs in certain anti-national activities and protests has led to the demand of proper monitoring mechanisms.