NGOs in India: Governance Perspectives

for UPSC Exam Preparation

To prepare for GOVERNANCE for any competitive exam, aspirants have to
know about Non-Governmental Organization (NGOs). It gives an idea of all the
important topics for the IAS Exam and the Governance syllabus (GS-II.).
Non-Governmental Organization (NGOs) terms are important from
Governance perspectives in the UPSC exam. IAS aspirants should thoroughly
understand their meaning and application, as questions can be asked from
this static portion of the IAS Syllabus in both the UPSC Prelims and the UPSC
Mains exams. Even these topics are also highly linked with current affairs.
Almost every question asked from them is related to current events. So, apart
from standard textbooks, you should rely on newspapers and news analyses
as well for these sections.

● A non-governmental organisation (NGO) is an organization that is neither a part

of a government nor a conventional for-profit business. Usually set up by ordinary
citizens, NGOs may be funded by governments, foundations, businesses, or
private persons.
● NGO activities include, but are not limited to, environmental, social, advocacy
and human rights work. They can work to promote social or political change on a
broad scale or very locally.
● NGOs in India play a critical part in developing society, improving communities,
and promoting citizen participation.

Frameworks of NGOs in India – Societies, Trusts and

Charitable Companies
Societies: Societies have to register under the Societies Registration Act,
1860.
Trusts: Private trusts are registered under the central government’s Indian
Trusts Act, 1882, and public ones are registered under the state
legislation concerned.
Charitable They are set up according to section 8 of the Companies Act,
Companies: 2013. For charitable companies, the compliance requirements are
high, as loans and advances are easily available to them compared
to a trust or a society. They have to even pay Income tax under the
IT act 1961.

Prominent NGOs in India:

● Akshaya Patra (TAPF): NGO in India, Feeds Mid-Day
● Meals to Children
● Smile Foundation
● Kailash Satyarthi Children’s Foundation
● ASER
● CRY: Child Rights and You
● HelpAge India
● OXFAM

Impactful Roles of NGOs in India’s Development

Landscape:
In developing countries India, there are numerous gaps left by the government
in the development process. These gaps are filled by NGOs:

● Work where the state is unwilling to work

● Work where state resources are inadequate
● Fighting social evils
● Right to Shelter: NGOs such as YUVA and SPARC in cities like Mumbai
● Right to Information: It is because of the efforts of NGOs that RTI has become
reality in India.
● Tribal Rights: As witnessed in the Vedanta vs. Posco case
● Implementation of welfare schemes
● Development and Operation of Infrastructure e.g. NGOs did a remarkable job
post-2004 Tsunami. Besides helping in rescue operations, NGOs in India also set
up vocational training centres
● Supporting Innovation, Demonstration and Pilot Projects by NGOs in India.
● Facilitating Communication
● Technical Assistance and Training
● Research, Monitoring and Evaluation
 ● Advocacy for and with the Poor – In some cases, NGOs become spokespersons
or ombudsman for the poor and attempt to influence government policies and
programmes on their behalf.

Laws and Financial Regulations for NGOs in India

Foreign Contribution ● Foreign funding of voluntary organizations in India is
(Regulation) Act regulated under FCRA act and is implemented by the
(FCRA), 2010 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 organisations require to register
themselves every five years.

Foreign Exchange ● Foreign Exchange Management Act (1999) aims to

Management Act, consolidate and amend the law relating to foreign
1999 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 in India were placed under the FEMA.

Facts about NGOs

● Only about 10 per cent of the over 22 lakh NGOs file their annual income
and expenditure statements, revealed by CBI.
● IB report stated that the working of few NGOs in the name of protests
against the government activities have become detrimental to the nation’s
development. It led to a loss of 2-3% of the country’s GDP.
Environmental NGOs in India Driving Protection and
Sustainable Development
● The rapid growing and unsustainable economic development is leading to a
number of environmental issues in India.
● They play a crucial role in helping to plug gaps by conducting research to
facilitate policy development, building institutional capacity, and facilitating
independent dialogue with civil society to help people live more sustainable
lifestyles.
● Issues like the future of environmental protection, sustainable development and
zero population growth are some of the major concerns addressed by
environmental NGOs in India.
● The NGO’s constitute a world-wide network interacting with Governments and
Internal intergovernmental organization in shaping international environmental
policies:
● Creating awareness among the public on current environmental issues and
solutions.
● Facilitating the participation of various categories of stakeholders in the
discussion on environmental issues.
● Conducting participatory rural appraisal.
● Being involved in the protection of human rights to have a clean environment.
● Protecting the natural resources and entrusting the equitable use of resources.
● Data generation on natural resources, timeline history of villages.
● Analysis and monitoring of environmental quality.
● Transferring information through newsletters, brochures, articles, audiovisuals,
etc.
● Organizing seminars, lectures and group discussion for the promotion of
environmental awareness.
● Helping the villages’ administrative officials in preparation, application and
execution of projects on environmental protection.

NGOs in India that work in the field of the environment:

● Assam Science Society
● Bombay Natural History Society
● Centre for Environmental Education
● Centre for Science and Environment
● Kalpavriksha
● Narmada Bachao Andolan
Advantages and Disadvantages of NGOs in India:

Advantage ● Ability to experiment freely

s ● Flexible in adapting to local situations
● Enjoy good rapport with people
● Ability to communicate at all levels
● Able to recruit both experts and highly motivated staff

Disadvanta ● Interference in local government:

ges ● Paternalistic attitudes
● Restricted/constrained ways of approach
● Reduced replicability of an idea
● Territorial possessiveness”
● No rules or regulations

Challenges faced by NGOs in India and strategies for

overcoming them:
● Asymmetry of power: 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.
● Siphoning of funds: 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.
● NGOs for namesake: It is estimated that only about 1.5 percent of NGOs in India
actually undertake developmental work.
● Political Activism: 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.
● Obnoxious agenda: Claiming involvement in human rights initiatives or social
empowerment, these organisations 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.
● Absence of Strategic Planning: 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.
 ● Poor Governance and Networking: 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.

Practical Measures to Enhance the Functioning of NGOs in

India
● Capacity Building: Capacity building and training can help to provide crucial new
skills. NGOs can then more readily train staff and cultivate the necessary skills
within the organization to address challenges going forward.
● On-Demand Advice From Experts: The ability to reach out for needed advice and
guidance whenever required during a project or to optimize NGO operations is
extremely valuable. Access to qualified experts will inspire confidence in donors
and contribute to the project’s success. NGOs will naturally become more
efficient, streamlined and effective.
● Information, Communication and Technology: All NGOs should be using a
minimum of Internet, email, a basic website and relevant social media platforms.
● Timely filing of annual income and expenditure: This will help in improving the
image of NGOs in the eyes of the government. NGOs also need to ensure that
laws, rules and regulations should be followed in letter and spirit.
● Democratisation of leadership: NGOs face many challenges in their journey.
Such challenges can be effectively tackled by rotating leadership among its
members.
● Disclosing foreign funding: Globalisation has blurred the boundaries of countries.
Global challenges like climate change, human development, poverty alleviation
are some of the pressing problems. And NGOs have also become globalised to
deal with these challenges. Thus maintaining records of such foreign fundings
will ensure transparency in their functioning and will create deterrence for laws.
● Inculcate the Essence of Voluntarism: NSS and NCC should encourage students
to participate in voluntarism from childhood days onwards. Universities, colleges
and schools have to collaborate with NGOs and conduct campus interviews for
the young graduates who are interested in voluntarism.
● Increased Role in Rural Areas: In India, 65% of populations belong to rural areas.
NGOs, therefore, need to operate in rural areas on a bigger scale to enlist the
cooperation of village people in making their lives better. At the same time, these
NGOs have to encourage the educated young graduates of rural areas to
participate in voluntarism.