Foreign funding of NGOs is a topic that never seems to lose currency. The Economist of September 19 reported that from Hungary to Azerbaijan; from Egypt to Mexico, Pakistan, Russia, Sudan and Venezuela, authoritarian governments have declared a war against civil society groups that use foreign money, allegedly to promote a “Western” vision of liberal democracy and human rights. Some have had their offices raided or funds confiscated.
Ironically, even the US has not been free of a bias against foreign funding and think tanks which receive foreign funds have faced official scrutiny. Still the US has not banned foreign funds, but only requires recipients to be transparent. So Indian NGOs who have been at the receiving end of governmental wrath over receipt of foreign funds can take cold comfort from the fact that they are not alone.
While the US does not really receive or need foreign funds on any scale, the other countries named, including India, do. Banning aid or harassing NGOs who receive it is no solution, because aid to NGOs has played a useful role in the development of many countries, despite some adverse effects. It is time therefore to weigh the benefits against the costs.
To take the good news first: Aid has brought more resources to the NGO sector than it could possibly have mobilised from within the country, enabling it to expand. It created a two-way channel for new ideas and technologies from abroad, while simultaneously enabling Indian achievements to find their way into the development discourse. This international engagement has helped Indian NGOs mature. Aid has also supported research and its dissemination.
Importantly, it brought a much-needed focus, both in policy and practice, on equity issues, under-served sections of society such as women, the SCs and adivasis and a focus on the environment. Many donor organisations work with MNCs in their own countries and educate them about responsible corporate practices like education of exploited children, fair trade and the like.
But it is also true that aid to NGOs has had some adverse impact on the voluntary sector as well as on Indian society as a whole. But these are not necessarily to do with bringing in Western liberal ideas, conversion, delays in development projects, or with destabilising political regimes, as the government alleges.
In India and elsewhere, aid, led to diversions from a chosen development pattern. For instance, early aid with its emphasis on Western technological solutions sidelined the Gandhian approach of self-reliance, low-cost local technology and decentralised development as well as the more political social change model adopted by peasant and other social movements of the early Sixties and Seventies. Now the pendulum has swung to the other extreme, and donors are espousing decentralisation, small check dams and low cost irrigation while it is the government which is continuing to favour large dams.
Aid to NGOs also increased disparities among NGOs, between the smaller, and less funded which depend on local charity, and the more prosperous ones, funded by foreign donors. This divide parallels the divide between Bharat and India. The funded organisations are modern organisations talking projects, appraisals, core funding, monitoring and evaluation and with formal systems while the vast bulk of the NGOs continue to function in an informal manner. Moreover, the salary structure of foreign-funded NGOs distorted the local reward structure and is unsustainable in the long run. But clearly the solution is to bring up Bharat to the level of India, especially since with mandatory CSR, these better organised NGOs are proving to be a boon to companies.
Perhaps the most tellingly adverse effect of aid on the voluntary sector has been the loss of activism by NGOs. This received a fillip when, after the 1980s, donors increasingly preferred partnerships with NGOs over sending expensive expatriate experts to the field. By itself institutionalisation is not bad. When NGOs move from being informal popular movements to adopting formal legal and organisational structures, it leads to greater permanence. But as they grow, there is a tendency for NGOs to become more flabby. Most importantly, as they become more organised they become more pragmatic and less radical, in fact the very reverse of what government finds objectionable.
Another adverse effect is that NGOs become upwardly accountable to donors. Donor pressure has also led to privileging certain issues like HIV-AIDS of concern to Western nations, rather than the eradication of malaria or malnutrition, the urgent problems of India. However, with pressure from experts and NGOs, donors have begun to adopt Indian agendas.
In the initial years, it is undeniable that political agendas were at play. However, NGOs are less vulnerable to foreign pressures today. The sheer size of the country, the insignificance of external aid, government vigilance and strong indigenous roots of the voluntary sector ensure that the adverse effects of external agendas are not deeply felt.
The best way to deal with the excesses is when they occur, on a case-by-case basis, rather than banning aid or making it difficult for all NGOs to use foreign funds.
The writer is the author of Foreign Aid for Indian NGOs: Problem or Solution
