The Crackdown on Organisations has Negative Outcomes for the Social Sector

The recent raids by the Income Tax Department on independent organizations that have been critical of the government’s agenda such as the Centre for Policy Research, Oxfam India and the Independent and Public-Spirited Media Foundation confirm government’s zeal to extinguish anti-government and pro-rights narratives.

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Imagining the India of the 20th century is difficult: privacy was not a fundamental right, the third gender was joked about, women had no rights, adultery was criminalised, and the death penalty was considered the ultimate solution to certain crimes.

Today, riding the wagon of progressive liberal thought, the majority, if not all of these, are now not on the table to debate upon, either due to judicial pronouncements or the change in public discourse. This is mainly because of the influence of the liberal ideas that floated into Indian borders from liberal democracies through globalization. However, the Indian government seems to believe otherwise.

Foreign-funded organizations can broadly be of two types: charity-oriented and research-oriented. These organizations function with a clear objective, which sometimes may lead to unwarranted outcomes. For instance, as early as 2015, an Indian Union Minister warned global charities not to oppose the government, while accusing activists from international environmental NGO Greenpeace of “unnecessarily inciting innocent people against crucial projects.”

While regulation to reduce funded opposition to the use of genetically modified organisms in food production or nuclear power may be desirable in some cases, it can quickly descend into hard-line restrictions on public debate.

FCRA, and its 2020 amendment

If an entity wants to receive foreign contributions in India, it must first obtain a license under the Foreign Contribution (Regulation) Act, 2010 (‘FCRA’). The Union government wants to hit on that foreign “influence.” To do so legally, the Parliament amended the FCRA in 2020, heavily restricting and changing the framework for receiving foreign contributions or funds by certain individuals, associations and companies in India. Rights activists and groups criticised and termed the amendment as a tool to silence and punish civil society organisations. More generally, scholars argue that the laws that curtail access to foreign funds are part of a “growing backlash against the liberal international order.”

The government’s primary argument in favour of the FCRA amendment is that ‘foreign powers’ are trying to influence the Indian political sphere and conspiring to downgrade India, ultimately threatening its national security – which the Supreme Court unfortunately accepted.

The 2020 amendment is overbroad as it prohibits inter alia the transfer of foreign contributions received by an entity to “any other person” – negating the prospects of any sub-grants. It reduced the amount of foreign contribution that can be used for administrative expenses from 50 per cent to 20 per cent. Further, it empowers the Union Government to direct persons receiving foreign contributions on its use and even bar further funding. It also mandates opening a bank account in the main branch of the State Bank of India in New Delhi, which would be used to receive foreign contributions.

Supreme Court challenge

The amendment was challenged before the Supreme Court for being manifestly arbitrary, unreasonable, and thus unconstitutional. In its judgment in April, the court upheld the law while accepting all contentions of the Union Government.

This judgement affects all not-for-profits working and receiving foreign funds in India – as the amendment not only empowers the government to restrict the organization’s access to funds completely, but also bans all collaborative work based on sub-grants. No organization would dare to criticise the government in such a legal framework, let alone challenge its policies.

The government’s primary argument is that ‘foreign powers’ are trying to influence the Indian political sphere and conspiring to downgrade India, ultimately threatening its national security – which the Supreme Court unfortunately accepted. It is not a singular instance – India’s top court has historically let itself down before the “national security” concern of the government.

The government categorically asserted that it wants to identify organizations through the amendment for “real-time monitoring of activities for ensuring that the same are not detrimental to the national interest.” Even if we accept these reasons, will the government allow organizations to work against its interests, or would not the government’s incentive be all but permit the organizations to work independently? As a matter of fact, Section 3(1)(f), read with Section 5(1) of the FCRA, directly prohibits organisations of a “political nature” from gaining an FCRA certificate, which refutes the government’s allegation of them influencing the political sphere.

The Supreme Court, in its judgment, reasoned that instead of gaining foreign contributions, the organizations should focus on generating donations within India, as “there is no dearth of donors within our country.” The court said that “foreign aid can create presence of a foreign contributor and influence the policies of the country. It may tend to influence or impose political ideology.”

If the court’s logic is accepted, in addition to curtailing the functioning of foreign-funded organizations, it also ought to cease its habit of quoting foreign scholars and judgements as precedent.

Moreover, according to the court, foreign aid tends to destabilise “the social order within the country.” The court perhaps failed to acknowledge that it was because of this progressive influence that many archaic laws have been struck down or read down by it – right from Section 66A of the Information Technology Act, to Section 377 of Indian Penal Code, and that  several developments in India have taken place – right from the 1991 economic reforms to the growing acceptability of the LGBTQ+ community.

In its judgment, the Supreme Court arguably overlooked the fundamental right to freedom of association and the principle of proportionality. If the court’s logic is accepted, in addition to curtailing the functioning of foreign-funded organizations, it also ought to cease its habit of quoting foreign scholars and judgements as precedent. If foreign jurisdictions were not referred to, there would have been no judgements like Puttaswamy, Shreya Singhal, Maneka Gandhi, and Bachan Singh, among several others, which substantially rely on foreign judgements.

Impact of FCRA

As per the government, more than 16,000 organizations in India have an active FCRA license, while more than 20,000 organizations’ licenses have been cancelled and 12,560 are deemed expired. Earlier this year, the license of more than 6,000 organisations, including Oxfam India and Jamia Millia Islamia, lapsed because the government denied the renewal of licenses.

In contrast, most organizations did not apply for renewal before the deadline. Besides, several world-renowned human rights organizations, such as Amnesty International India, the Commonwealth Human Rights Initiative, and The Ford Foundation, have had their licenses cancelled since the Bharatiya Janta Party (‘BJP’) came to power at the centre. Notably, the COVID-19 relief work was also impacted due to FCRA, as the funds stood in violation of the law in some cases.

I previously wrote that the overall FCRA framework is a “program to satisfy the Union Government’s zeal to extinguish anti-government/pro-rights narratives.” The recent raids by the Income Tax Department on independent organizations that have been critical of the government’s agenda such as the Centre for Policy Research, Oxfam India and the Independent and Public-Spirited Media Foundation only confirm my contention.

In May, raids were conducted by the Union Government at 40 places in a crackdown on foreign-funded organizations, alleging that the organizations gained FCRA certificates by bribing officials. While I was a volunteer with Amnesty International India, the organization decided to shut its operations down in India in September 2020. Although Amnesty was facing harsh restrictions ever since the BJP government came to power, it was its coverage of the Delhi Riots 2020, hate crimes, and the National Register of Citizens in Assam, the former two of which I had the opportunity to engage in, that majorly resulted in Amnesty being shut down in India.

The basic idea behind curtailing foreign funds is a verse of BJP’s bigger monologue – cultivating a centralised and dictatorial regime. The FCRA, electoral bonds, last year’s Information Technology Rules, the recent directions to Virtual Private Network provider companies, the unregulated use of facial recognition technology, and the Criminal (Procedure) Identification Act are all chapters of that monologue. The government has systematically enacted these laws to build a stronger State authority that would decide the fate of the citizens at its fingertips.

Some may argue that there is indeed a need to monitor foreign funding. However, the mandates under the new amendment are illogical, unreasonable, and disproportionate, making any defence of the law nothing more than a rhetorical representation. If anyone is accused of criminal activity, due process has to be followed, rather than the accused being jailed or their functioning instantly curtailed.

Interestingly, the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (‘PM CARES Fund’) was exempted from FCRA regulations as well as the income tax law, meaning that any donor from any part of the world could donate to PM CARES. Even the donation information would not be available to the public as the PM CARES fund is also exempted from the right to information law. Is this equal application of the law? Certainly not. It can be argued here that a political party in power would utilize PM CARES for its own political discourse.

The crackdown on organizations, in most, if not all, cases, has resulted in negative outcomes for their beneficiaries, who are Indian citizens, and has reduced the overall impact in the social sector. The basic idea behind curtailing foreign funds is a verse of BJP’s bigger monologue – cultivating a centralised and dictatorial regime. The FCRA, electoral bonds, last year’s Information Technology Rules, the recent directions to Virtual Private Network provider companies, the unregulated use of facial recognition technology, and the Criminal (Procedure) Identification Act are all chapters of that monologue.

The government has systematically enacted these laws to build a stronger State authority that would decide the fate of the citizens at its fingertips. However, the government should not forget that sovereignty belongs to individuals; thus, individual freedom should be the end goal of any policy it promulgates, not a centralised authority.

Md. Tasnimul Hassan is a Writing Fellow with Fellowship for Freedom in India, and a law student at Jamia Millia Islamia, New Delhi.