January 3, 2022
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Good morning. Wish you a happy new year! Hope you find an abundance of joy and happiness this year.
We resume regular newsletter service with a piece of out-of-the-world news. One of Stephen Hawking’s most far-fetched theories could be tested. His theory proposed the existence of dark matter that may be made of black holes formed in the earliest moments of the Big Bang. Three astronomers have developed a theory for this. The recently launched James Webb telescope could be one of the instruments that helps them in this effort. It will give them insights into the earliest origins of the universe, black holes, and dark matter.
📰 FEATURE STORY
Good people, bad things and an FCRA that doesn’t quit
Unless your New Year’s resolution is to cut out all the bad energy in your life, you’re probably still reading the news. And it’s good that you’re paying attention too as it turns out, charities aren’t doing so hot in our increasingly warm nation. Just the other day, nearly 6,000 institutions, including Mother Teresa’s Missionaries of Charity, lost their ability to attain foreign capital. They seemed to have somehow lost their licence under the Foreign Contribution (Regulation) Act (FCRA).
While this might just seem like a clerical error, you have to remember that foreign contribution is really where it’s at for the non-profit sector. And if we are to look at India’s behavioural patterns, we haven’t necessarily been the kindest to NGOs in the past. So, is this just another attempt to target marginalised communities or are we simply safeguarding national interest? Let’s find out.
The FCRA first came into play in 1976. It was enforced by the Ministry of Home Affairs (MHA) to regulate and monitor the “inflow of foreign contributions or aid to the country.” One of its main features is that it goes over which organisations are eligible for foreign contributions and those that aren’t. For example, political parties, government employees, media outlets, etc., were not allowed to accept alien donations. This was done to ensure that foreign organisations don’t influence the socio-political and economic scenario of our country.
NGOs, as long as they reported the amount they received and spent in a year, were always kept open to such contributions from distant lands. It was in 1984 that the law was amended, making it mandatory for them to register under the FCRA for the same. The 1976 law was finally repealed and replaced with the FCRA, 2010. This was when the notion of “national interest” really took flight. Yet, foreign funding for political parties all of a sudden opened up.
In 2020, the act was subjected to several more amendments that increased the Centre’s involvement in the whole process. This includes everything from the renewal of licenses to the use of funds, which has been reduced to 20% from the previous 50%. While the government believes that this will eventually help in monitoring the influx of alien money, NGOs are describing the changes as ‘highly oppressive’.
Steep hurdles and standstills
Believe it or not, people have been feeling the effects of these amendments even before this mass loss of licenses. As patent consultant Vinay Kumar pointed out, the new changes make it “almost impossible for an individual to bring foreign funds even if it is readily available.” And using those funds once acquired becomes a whole other ordeal. There are several changes that NGOs find oppressive but there are three in particular that make things especially bad.
One is the modification of Section 7 of the Act. This prohibits the transfer of foreign funds from the organisation that received it to any other institution. It doesn’t matter if the recipients are going to use the money or not. Two, the harsher limits on administrative expenditure. Previously, institutions were allowed to use up to 50% of their foreign contributions for admin. Now, that limit has been brought down to a mere 20%. This heavily impacts the regular day-to-day operations of NGOs.
And finally, we come to the third change that is turning out to be quite the problem. The clause that makes it mandatory for the recipients of foreign funds to open an FCRA bank account in “a designated branch of the State Bank of India in New Delhi.” The institutions are then allowed to open other FCRA accounts in any “scheduled bank”, i.e. a bank that is mentioned under Schedule II of the Reserve Bank of India Act, 1934. They can then transfer those funds to this new account for further usage.
The main problem with all of this is the mental and bureaucratic gymnastics needed to work within its parameters. Sure, lawyer-speak is hard anyway but even the courts seem to be confused about the correlation between “national security” and the designation of one specific branch for pan-India purposes. Along with this, license renewal has also become a lot harder. Before, the licences would get renewed based on history and records. Now, the Centre is allowed to “initiate a fresh inquiry” into an organisation’s workings for renewal. Thus, subjecting them to the same level of scrutiny as when they first registered.
It all comes down to admin
Bookkeeping can be quite taxing for even the best of us and the government believes that these amendments can help with that. The goal here is to “streamline the flow of funds and to enhance transparency and accountability.” The authorities even talk about how foreign contributions to Indian institutions doubled in the past decade but little was done to monitor it. So when the law changed, even with the introduction of the FCRA, 2010, over 19,000 institutions had to re-register. Some even faced prosecution as the funds received were not being used as intended.
The 1976 version of the FCRA might seem a lot more lenient but that’s mostly because it was an emergency-era law. The goal, at the time, was to keep political parties from receiving foreign funds as that would have turned our political scene on its head. This is no longer the case. Given the widening scope of both national and public interest, the government has no other choice but to be vigilant. Institutions and organisations mentioned under the FCRA cover everything from education to the economy. Structures with that much influence need to be treated with an appropriate amount of scrutiny.
Over the past few years, several NGOs were even sending in doctored reports to the MHA. Apparently, some organisations were inflating their actual expenditure when it came to admin. The tight limit of 20% set on the usage of the foreign funds are expected to help deter this diversion. The rationale behind the designated bank branch was also described as a necessary safeguard. If anything, having a singular branch look over and keep track of all foreign transactions will definitely make monitoring far more efficient for the government. While this might seem unnecessary to some, the needs of a nation have to trump those of an organisation.
🕵️ BEYOND ECHO CHAMBERS
For the Right:
On The 20th Anniversary Of The Gujarat Pogrom, Will Modi Finally Apologise?
For the Left:
Calling Out Bloomberg’s Racist Fusillade Against India
🏴 STATE OF THE STATES
Request for better forecast technology (Tamil Nadu) – Parts of Tamil Nadu, including Chennai, was surprised by an intense spell of heavy rain on December 30. It caused waterlogging in several parts of Chennai. Chief Minister MK Stalin urged the centre to upgrade the technology at the Regional Meteorological Centre, citing an inability to predict this latest spell of rain. The state relies on alerts issued by the IMD’s Regional Meteorological Centre in Chennai. He said timely and accurate alerts would help the government better prepare with mitigation and relief efforts.
Ban on unvaccinated (Haryana) – To encourage people to get vaccinated, the state has introduced a vaccine mandate. Per orders from the state health minister Anil Vij, unvaccinated people will not be allowed into public spaces such as bars, shops, restaurants, malls, markets, etc. Only those who have received both doses will be permitted. Corporate and private offices will also be mandated to follow this order. It comes in the wake of a night curfew introduced in the state.
Making Bastar Naxal-free (Chhattisgarh) – Chhattisgarh Chief Minister Bhupesh Baghel hailed the efforts of security forces in keeping Naxal forces at bay in the Bastar region. He claimed a majority of the region is now Naxal-free. In a speech to state police and paramilitary personnel, he said his government is happy with the polices’ work in the Naxal-affected areas. He cited security officials setting up camps in Maoist strongholds and pushing them on the back foot. He wants Bastar to be looked at as a place of development.
Koregaon Bhima battle anniversary (Maharashtra) – Marking the 204th anniversary of the Koregaon Bhima battle, thousands paid tribute at the Jaystambh military monument in Pune. Several state-level politicians also visited the site. It marks the battle where British forces fought the Peshwas in Koregaon Bhima on January 1, 1818. Lakhs of people, mainly from the Dalit community, who made up a majority of the Peshwa soldiers, visit the site erected by the British. More recently, the site witnessed violence in 2018 in which police said provocative speeches were made a day before the violence.
Full border fencing (Tripura) – The India-Bangladesh border in the state will be fully fenced by next year. Border Security Force Inspector General (Tripura Frontier), Sushanta Kumar Nath said, a majority of the 856-km-long India-Bangladesh international border has already been fenced. Over the past year, the state’s eastern sector has seen substantial fencing work, and floodlights will also be installed. Last year, the BSF seized items worth ₹35.64 crores and arrested 218 people for crossing the border.
🔢 KEY NUMBER
30,864 – The number of complaints of crimes against women received by the National Commission for Women (NCW) in 2021. It is a 30% increase from the previous year.