NGO regulations

‘Aadhaar for NGOs’: Why nonprofits are uneasy about new order to obtain unique ID from Niti Aayog

The government has made it mandatory for NGOs receiving foreign funds to register with Niti Aayog’s NGO Darpan portal.

Through a public notice issued on October 4, the Union Ministry of Home Affairs has made it mandatory for all non-governmental organisations that receive or hope to receive foreign funding to register with Niti Aayog’s portal NGO Darpan.

The notice states that in order to receive money under the Foreign Contribution Regulation Act, 2010, NGOs must obtain a Unique Darpan Identification Number from the portal. Registration will involve providing contact details as well as PAN and Aadhaar numbers of the organisation’s key functionaries. The deadline for registration has not been specified.

NGO Darpan was set up in 2009 as the erstwhile Planning Commission’s NGO Partnership Portal, an online database of nonprofit or voluntary organisations, particularly those funded by the government. The Planning Commission was dismantled and replaced by the policy think tank Niti Aayog after the Narendra Modi government took power in 2014. The portal is meant to be an interface between NGOs and key government ministries and departments.

Registration on NGO Darpan was voluntary. That changed in April this year, when the government submitted a new set of guidelines to the Supreme Court for regulating the nonprofit sector. It proposed to make Niti Aayog the nodal agency for registration and accreditation of NGOs, and made it mandatory for voluntary organisations seeking government funding to register with Darpan and obtain a Darpan identification number. Currently, more than 33,000 NGOs are registered on the portal.

Through the October 4 notice, this requirement has also been imposed on NGOs receiving foreign funding.

This has irked several people in the NGO sector, who see the compulsory Darpan registration either as an added formality with no specific benefit, or as yet another tool that the government can use to clamp down on foreign-funded NGOs. This feeling is shared even by people who have long demanded a central nodal agency to regulate all Indian NGOs.

“This is paranoia on the part of the government – they want to put maximum chains on foreign-funded organisations,” said Harsh Jaitli, chief executive officer of the Voluntary Action Network India, better known as VANI, an association of NGOs in the country. “The FCRA law managed by the home ministry already exercises as much scrutiny over nonprofits as is humanly possible. Now they are looking for new ways to clamp down on NGOs.”

VANI has long favoured centralising NGO regulation and streamlining the process of their registration, monitoring and accreditation. Since February, it has been advising the government committee that framed the new guidelines submitted to the Supreme Court in April.

Complex system

India has more than 30 lakh voluntary organisations involved in charity, social advocacy, religious operations and other work. They are registered as trusts, societies or nonprofit companies under multiple central and state laws. Many run on government grants, serving as grassroots workers for implementation of welfare schemes.

Broadly, government-funded NGOs that work for rural development are regulated by the Council for Advancement of People’s Action and Rural Technology, a nodal agency under the Ministry of Rural Development. Since 2010, the home ministry has been regulating and monitoring the accounts of NGOs licensed to receive funding under the Foreign Contribution Regulation Act.

The discussion on simplifying the regulation of NGOs is at least a decade old. In 2007, the central government had proposed a National Policy on the Voluntary Sector, which provided for one central law to regulate all NGOs. Then in 2010, the Planning Commission published a report recommending the setting up of a National Accreditation Council for NGOs. It also asked for strengthening the Darpan portal so that NGOs could apply online for accreditation.

These suggestions were not really followed up and Darpan grew into a portal where NGOs could register optionally, not for accreditation but for promoting themselves to the government. “This was beneficial for organisations because those who wanted government funding could choose to register and get visibility,” said Aditya Shrivastava, a lawyer who has worked with several NGOs.

Change for good?

In 2011, in the midst of the anti-corruption movement spearheaded by the social activist Anna Hazare, lawyer ML Sharma filed a Public Interest Litigation in the Supreme Court questioning the financial accountability of Hazare’s NGO and others. The case, which led to inquiries into every aspect of the functioning of voluntary organisations in India, is still being heard in the apex court.

In January, the Supreme Court directed the government to frame guidelines for accreditation of NGOs. In February, the rural development ministry constituted a committee for the task. The committee did not have representatives from the nonprofit sector, except for VANI, which served as an advisor.

The guidelines called for overhauling the system, starting with the legal framework for NGO registration. It recommended using modern technology for “less intrusive but adequately robust accountability”, and a central ministry as the nodal agency to regulate the sector. Since the agencies under the rural development ministry would not cover NGOs working in urban areas, the committee suggested Niti Aayog could do this job at some point.

Aadhaar for NGOs?

People in the nonprofit sector who had been hoping for a centralised one-stop shop for NGO regulation are now disturbed by the home ministry’s decision to make Darpan identity numbers compulsory for foreign-funded NGOs.

“Recommendations in all the old reports were aimed at making NGO-running easier,” said Shrivastava, the lawyer. “But instead of Darpan being a one-stop shop, NGOs still have to register with the state charity commissioner and file reports to ministries of rural development or home affairs. Darpan will be an additional registration.”

Given how stringent the licensing process under the Foreign Contribution Regulation Act already is, Shrivastava suspects the Darpan identification number, which he describes as “Aadhaar for NGOs”, could be used to target nonprofit organisations that are at loggerheads with the government.

“Last year, the government brought FCRA-licensed organisations under the scrutiny of the Lokpal Act,” said Jaitli from VANI. “Now it is the Darpan portal and Niti Aayog. There are no explanations for these steps, just dictates from the government.”

A senior social activist in Delhi, who did not wish to be named, echoed these concerns about multiple registrations. “Niti Aayog should only be concerned with government-funded organisations,” the activist said. “Why should others, who are already being scrutinised by the Income Tax department and the home ministry, have to have yet another registration?

The activist pointed out that the purpose of the mandatory Darpan registration is not clear. “This is overall tightening of the regulatory regime, particularly for foreign-funded NGOs,” the activist said. “It is a pattern of victimisation of civil society organisations that we have seen since this government has come to power.”

Moreover, Shrivastava argued that Niti Aayog was not the ideal nodal agency for governing NGOs. “Ideally the nodal agency should be an existing or a new ministry at the Centre,” he said. “Niti Aayog does not have legislative standing.”

Still, Jaitli claimed many NGOs are resigned to doing the new Darpan registration despite their reservations. “Voluntary organisations have reconciled themselves to the fact that receiving foreign funding is seen as almost a crime in this country, and that they will be under extreme scrutiny,” he said.

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