The recent IB revelations titled "Concerted efforts by select foreign funded NGOs to take down Indian development projects" is not a new development. The Intelligence Bureau has been routinely reporting such matters in the past too. What has raised the eyebrows this time is the leakage of the report at a time when quick economic growth has become the new buzzword.
Is it (the report) a precursor to clamp down on the NGOs that are being seen as a major roadblock to India's economic development potential and unleash reforms in the power and mining sector that could propel the economic growth? Blaming the NGOs for serving as tools for the strategic foreign policy interests of western governments, the IB report claims that the negative impact of NGOs is about 2-3 of the GDP per annum.
Government sources, part and parcel of the agenda for India's economic growth, don't agree with this line of argument and claim it as flawed as no scientific study has been done to back this claim. However, they do agree that the report could lead to larger repercussions. "This report has been marked to both PMO and finance ministry besides the ministries for home, coal and power. This could be the beginning to have a fresh look at the way NGOs have been working till now. In near future there could be changes in the Foreign Contribution Regulation Act (FCRA) that deals with the funding of the NGOs," a senior official said.
Incidentally, the IB report though comes hard on scores of NGOs and donor agencies, including some reputed ones like Amnesty International and Action Aid, for undermining India's growth story by funding and spearheading protests, it does not say much about how they violate laws or rules of the country. Most of them, barring one or two guilty of some violations, have been following the stringent provisions of the FCRA Act.
Sources said, to stop the NGOs from undertaking participatory agitations against big corporations like Vedanta, POSCO and others, the government could resort to changes in section 5 of the FCRA that may lead to framing of fresh guidelines specifying the grounds on which an organisation shall be specified as an organisation of a political nature. Specifying an NGO as an organisation of political nature can immediately lead to freezing of accounts and cancellation of funding.
But before government does that it has an uphill task of clearing the names of two major political parties – the Congress and the BJP, that have been found by the Delhi high court prima facie guilty of "clearly fall foul of the ban imposed under the Foreign Contribution (Regulation) Act as the donations accepted by the political parties from Sterlite and Sesa accrue from "foreign sources" within the meaning of law."
On March 28, 2014, the high court directed the union home ministry and EC to "relook and reappraise the receipts of the political parties and identify foreign contributions received by foreign sources" and take action within six months.