India's NGO Backlash
by Ram Mashru, foreignpolicy.com
July 21th 2014
On July 10, India's recently elected government presented its draft budget to Parliament. Finance Minister Arun Jaitley's speech underwent the usual flurry of analysis -- most of which, however, glossed over a particularly insidious detail. Should it become law, the budget will grant revenue officials the power to revoke the registration and tax exemptions of any nongovernment organizations or charitable institutions that run afoul of the country's complex tax rules. The measure spells disaster for India's civil society organizations.
The budget proposal follows the furor over a report produced by one of India's domestic intelligence services that denounces the country's NGOs as fronts for foreign interests that are undermining India's development. The leaked report -- which claims that NGOs are responsible for a 2 to 3 percent loss to economic growth -- was handed to Narendra Modi, India's new right-wing prime minister, days after he took office, and it was circulated to a number of government ministries, prompting fears of an official clampdown.
Although the report names dozens of activists and organizations, it singles out Greenpeace as a "threat to national economic security." The organization, the report alleges, is using its "exponential" growth in terms of "reach, impact, volunteers, and media influence" to "create obstacles in India's energy plans." (The photo above shows Greenpeace activists staging a sit -in to protest the destruction of forests in Madhya Pradesh.) Also in the cross-hairs are groups such as Amnesty International and ActionAid, which are accused of sponsoring "anti-national" protests.
The report bemoans the disruption caused by NGOs in sectors spanning industry, technology, and natural resources, and it comes just as India's new government has pledged to fast-track applications for major construction projects. The coincidence exposes a clear commercial motive: NGOs in India have been particularly active in campaigning against large projects that are environmentally devastating. The report discredits this long and successful history of activism just as India's government has given the green light to firms seeking to exploit the country's natural and industrial potential.
"The government is adopting scare tactics," said Suhas Chakma, director of the Asian Center for Human Rights, in an interview with the Guardian. "It wants to ensure that nobody comes in the way of big projects." The People's Union for Civil Liberties, India's largest human rights organization, also reportedly blasted the report as an attempt to intimidate and silence activist groups. Some activists named in the report -- such as the anti-nuclear campaigner S.P. Udayakumar, who was accused of having "deep and growing connections" with the United States and Germany -- are considering legal action.
The demonization of India's watchdog agencies is neither new nor unexpected, but foreign funding is a particularly sensitive issue. In fact, India's Intelligence Bureau is not the only organ of state investigating the matter. In a follow-up to the report, India's Ministry of Home Affairs claimed that the country's NGOs are "vulnerable to the risks of money laundering and terrorist financing." And on July 4, India's Supreme Court directed the Central Bureau of Investigation, another domestic intelligence agency, to complete its probe into NGO finances after entertaining a public-interest lawsuit last year against the Hind Swaraj Trust, an outfit founded and run by the famous anti-corruption activist Anna Hazare.
Despite having full charitable status in accordance with Indian law, Greenpeace's Indian subsidiary is now subject to a new set of rigid rules. It must obtain the approval of the Ministry of Home Affairs before it can accept any future donations from the U.S.-based ClimateWorks Foundation or its parent body, Greenpeace International.
This policing of NGO finances has an insidious history. In India's war of attrition against civil society organizations, starving them of funds has been the preferred mode of attack. Last year, Human Rights Watch reported that the Indian government was using funding rules to "repress groups critical of the government." The report accuses the government of using ministerial harassment, the threat of criminal investigation, and restrictive financing regimes to force advocacy groups to "toe the line." The consequences have been far-reaching. In May 2013, the government revoked the right of the Indian Social Action Forum, an umbrella organization, to receive foreign funding, constraining the operations of its 700 subsidiaries. Last year, India's Ministry of Home Affairs froze the accounts of as many as 4,000 NGOs for violating rules on international funding. Groups across the spectrum -- campaigning on issues as diverse as torture, domestic violence, and minority representation -- have all been undercut in this way.
The chief culprit is the 2010 Foreign Contribution (Regulation) Act. Originally passed as an anti-corruption law aimed at preventing politicians from taking bribes from abroad, the statute mandates an onerous system of financial hurdles for civil society groups. As Maja Daruwala, of the Commonwealth Human Rights Initiative in New Delhi, notes, under the act, India's NGOs are "unfairly overregulated." They must reregister every five years, cannot accept foreign funds for any activities dubbed "political" by the state, and are denied the investment opportunities available to other legal entities, forcing them to survive on charitable contributions.
This overregulation exposes a despicable double standard on foreign money. India is severing crucial international funding lifelines for NGOs even as it actively courts foreign investment in key industries, including defense, infrastructure, and insurance. Indeed, the July 10 budget speech was a sustained signaling exercise, rolling out sweeping reforms in an effort to seduce international investors.
Campaigners across the globe have fought hard to free India's advocacy groups from these restrictive controls. In 2011, Margaret Sekaggya, then the U.N. special rapporteur on human rights defenders, and, in 2012, the U.N. Human Rights Council's Universal Periodic Review committee both called on India to reform its laws to ensure that civic organizations can operate with freedom and independence. In the absence of such protections, Indian NGOs are left with only two options: They must self-censor or close shop.
Of course, not all nonstate groups are benign. It was the Shiksha Bachao Andolan Samiti (Save Education Movement), a group that claimed to be safeguarding collective interests, that forced the recent pulping of The Hindus, a history of Hinduism by University of Chicago scholar Wendy Doniger. The group sued Penguin, the book's publisher, for offending religious sentiments, triggering a four-year legal battle that ended with Penguin's capitulation earlier this year, when it agreed to an out-of-court settlement. Emboldened by this victory, the Save Education Movement has now set its sights on other works of art and literature that it has deemed transgressive.
Yet it's not this sort of activity that prompts the ire of NGO critics. The Intelligence Bureau report taps into a deep well of knee-jerk public hostility toward nonstate groups, especially those that are nonnative. The Intelligence Bureau's conclusions raise some important questions about the quality of India's nonstate space: How tolerant is the government of critical voices? How willing is it to remedy complaints and be held to account? The Intelligence Bureau report dismisses the work of some of India's most prominent NGOs as "anti-national" -- a nebulous offense encompassing almost anything that goes against the government's platform. Some political groups have welcomed the possibility of a clampdown, accusing NGOs of falsely claiming to be working in the public interest to avoid scrutiny. The vagueness of these charges reflects a mounting threat to Indian civil society.
The tragedy is that the Intelligence Bureau's fresh assault on NGOs is entirely unprovoked. Claims that NGOs have held back India's growth are highly dubious. There is little evidence of a nefarious "foreign hand" at work, and there is scant suggestion that NGOs have broken any laws. But the damage has already been done. India's Ministry of Home Affairs called a meeting on July 4, after the leaked report made headlines, and decided that the implementation of the Foreign Contribution (Regulation) Act needed to be "tightened" and that there should be "greater scrutiny of those NGOs about whom the government has [received] an adverse report."
As Daruwala has argued, "True democracies celebrate involvement of citizens." The covert war that India has waged against civil society groups places serious hurdles in the way of popular participation and corrupts the quality of nonstate space. First, the demonization of NGOs diminishes India's proud history of civic activism, which deserves credit for everything from catalyzing the country's independence movement to campaigns for women's rights. But more worrying is the creation of a climate of fear and self-restraint. As the anti-nuclear campaigner Achin Vanaik said in the aftermath of the report to the Guardian, "We are fearful that this is a kind of witch hunt with longer-term implications to repress all kinds of popular struggles."