‘Online Analytical Tool’ to keep eye on flow of foreign funds!

There are news reports that Ministry of Home Affairs (MHA) has launched an 'Online Analytical Tool' “to keep a close eye on foreign funded NGOs”. 

This is nothing new nor something that some of us in the voluntary sector were not already aware of!

On 21^st December 2017, Ministry of Home Affairs had issued a notice that organisations having prior permission or registered under the Foreign Contribution Regulation Act (FCRA) 2010 should maintain their FCRA Bank account only with banks integrated with the Public Financial Management System (PFMS). At that time 32 Banks were in the list of PFMS integrated Banks. Currently the list has grown to 55.

The Public Financial Management System, earlier known as Central Plan Schemes Monitoring System (CPSMS), is a web-based online software application developed and implemented by the Office of Controller General of Accounts (CGA).

According to media reports MHA launched the “Online Analytical Tool” on Friday, 1^st June 2018 “to analyse in real time the source, destination and the actual usage of the fund.”

Reportedly, the online analytical tool will also give government “the capacity to take data-driven and evidence-based decisions regarding the compliance of the provisions of the Foreign Contribution (Regulation) Act, 2010.” It has analytical features to conduct big data mining and data exploration. Its dashboard will be integrated with the bank accounts of the FCRA-registered entities through the Public Financial Management System for updating of transactional data on a real-time basis.

MHA’s obsession with NGOs

MHA’s obsession with NGOs and FCRA has always fascinated us. 

Significantly more foreign funds flow into India through Foreign Direct Investment (FDI) and through Foreign Institutional Investors (FIIs). However, these are regulated under a much softer and user-friendly Foreign Exchange Management Act (FEMA).

Foreign Direct Investment in India has averaged US $ 1,294.03 Million from 1995 until 2018, reaching an all-time high of US $ 8,579 Million in August of 2017. India has also received net investments of US $ 19.79 million from Foreign Institutional Investors (FIIs) between April to December 2017.

In contrast, there are only approximately 25,000 active organisations registered under the FCRA receiving foreign contributions worth Rs. 18,065 crores from foreign donors for various social, cultural, economic, educational and religious activities.

Does MHA and the Government of India really believe that 25,000 NGOs with aggregate receipts of Rs. 18,065 crores from foreign donors for various social, cultural, economic, educational and religious activities can be a “threat to National interest” or “affect prejudicially the sovereignty and integrity of India”?

In any case, remember, we, the NGOs are being watched and closely monitored, 

But, then again, if you are legally compliant, you have little to worry. Let, them watch us. Let them monitor us. And, let us prove to MHA that far from being a threat or of nuisance value, NGOs play a critical part in developing society, improving communities and promoting citizen participation within the sovereign democratic republic of India.