In a big nationwide crackdown across 40 locations, the CBI has detained 10 people for taking bribes on behalf of non-profits for allegedly facilitating violations of rules in receiving foreign donations. We take a look at why NGOs keep running into trouble over overseas funds
A protest against Amesty in Bangalore in August 2016. AFP
In a major nationwide operation, the Central Bureau of Investigation (CBI) cracked down on non-government organisations (NGOs) for violating norms in receiving foreign funds. The CBI raided 40 locations across the country and at least 10 people, including five government officials, have been detained for allegedly taking bribes on behalf of non-profits.
The operation was launched following a complaint from the Union home ministry to the CBI. The decision to alert the probe agency was in line with the Narendra Modi government’s “zero tolerance for corruption” policy.
More than 12 home ministry officials, NGO representatives, and middlemen were allegedly involved in facilitating the violations of rules under the Foreign Contribution (Regulation) Act [FCRA].
We take a look at the reason for the CBI crackdown and why foreign-funded non-profits keep running into trouble in India.
Bribing home ministry officials
The CBI on Tuesday found Rs 2 crore in hawala transactions at 40 locations in Delhi, Chennai, Jaipur, Coimbatore, Mysore, and Rajasthan, among others.
According to the complaint, bribes were paid to lower-level officials in the foreign division that deals with FCRA clearance. The middlemen took money from NGOs, which were denied FCRA clearance, and paid the government officials to provide them with the approved licence, according to a CNN-News18 report. No senior officials have been found linked with the case so far.
Twelve non-profits are under the CBI scanner for bribing home ministry officials to get their FCRA licence renewed. Sreejan Foundation in Jharkhand, Jahangirabad Educational Trust in Delhi, and Reformed Presbyterian Church in Manipur’s Churachandpur are some of the NGOs that are reportedly in trouble.
FCRA, the law passed during Emergency
The Foreign Contribution (Regulation) Act [FCRA] came into force during the peak of the Emergency in 1976 amid concerns that foreign powers were interfering in the country by fuelling funds through independent organisations.
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”, according to a report in The Indian Express.
The FCRA was passed by the then prime minister Indira Gandhi, who was worried that rival politicians like George Fernandes were linked to international socialists including Willy Brandt, German leaders, and European socialists and received foreign funds.
UPA’s amendment
In 2010, the United Progressive Alliance (UPA) tightened the FCRA. The Act was amended by the government to “consolidate the law to regulate the acceptance and utilisation of foreign contribution” and to prohibit its use for “any activities detrimental to national interest”.
The original law allowed foreign contributions to be spent as desired, but the 2010 amendment said only 50 per cent of the amount could be spent on administrative expenses, reports ThePrint.
Modi government and FCRA
The Narendra Modi government amended the law and passed the Foreign Contribution (Regulation) Amendment Bill, 2020 in Parliament. It gave the Centre more control to scrutinise foreign funds received and utilised by NGOs.
According to the government’s FCRA guidelines, all registered organisations are required to submit an online annual report comprising of income and expenditure statement, receipt and payment account, balance sheet for every financial year within nine months of the closure of the financial year.
The Act prohibits the receipt of foreign funds by candidates for elections, journalists or newspaper and media broadcast companies, judges and government servants, members of the legislature and political parties or their office-bearers, and organisations of a political nature, reports The Indian Express.
The 2020 amendement disallows the recipient of funds to transfer the contribution to any other person and it allows the government to suspend licence from earlier 180 days to 360 days if it finds the workings of the organisation suspicious.
Around 5,900 NGOs lost their FCRA licence after December 2021 because the organisations did not apply for renewal before the due day or the home ministry refused their renewal for alleged violation of the Act.
In December 2021, the ministry refused to renew the FCRA registration of Mother Teresa’s Missionaries of Charity, based on “adverse inputs”. It was, however, restored on 6 January.
Over 16,895 organisations have registered in the country under FCRA since 2020. Over 466 NGOs have been refused FCRA licence of which 100 applications were in 2020, 341 in 2021 and 25 organisations until March 2022, reports CNN-News18.
With inputs from agencies
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