Ever Mushrooming NGOs- Are They Really Helping Anyone?

Posted on March 18, 2011 in Entrepreneurship


By Srishti Chauhan:

Spanning a cosmic expanse of 3,287,263 square kilometers, India has a vast number of Non-Governmental Organizations (NGOs) which function in its territory. A staggering value of 3.3 million NGOs is estimated to be running across the country- none with a disparate endeavor.

What can surely be deemed as ironical, to say the least, is that the presence of so many NGOs is working in the opposite direction. Instead of putting India on a fast track to development by working with the government for alleviation of the shortcomings of the Indian economy, the NGOs actually contribute to increasing the corruption index and state of inefficiency in the country.
At a centrally controlled site ‘ngo.india.gov.in’, NGOs are required to register themselves following which they will be eligible for grants by the Centre and will also be able to enjoy the schemes that government conceives for these organizations. The foremost problem that rests with such a scheme is that the proper use of grants and funds allocated is neither monitored by the center nor is it mandatory for the NGO to submit a written statement putting forth all expenses incurred with the monetary support provided.

The major problem an ordinary person wishing to donate in an NGO encounters is the lack of accountability of the money that is donated. Over the past decade, the boom of NGOs has primarily been due to the immense profit that such organizations make. Consequently a lot of scams involving swindling of money have also been unveiled over the past decade.

In 2009, the government had banned 833 NGOs and voluntary organizations following misappropriation of public funds. Andhra Pradesh, fast emerging to be one of the most corrupt states, is said to have the highest number of such blacklisted organizations- followed by Bihar and Tamil Nadu.

Another striking problem that the administrative system faces with this NGO boom is the difficulty of adverse selection- an economic term which refers to selecting the good from the bad with no knowledge whatsoever about the ‘good’. Due to the misconduct of a large number of NGOs, the small numbers who actually wish to be a part of the developmental procedure face a heavy setback. Often facing the lack of trust, these associations find it difficult to promote their chief interests- the promotion of their cause. The government- faced with the difficulty of choice- often resorts to blacklisting all NGOs in a heavily corrupt area.

Another quandary intrinsic to the NGO business is the lack of foresight. Many NGOs which, on paper, are set to promote and enhance the level of education in India resort to teaching the underprivileged- failing to understand the futility of the exercise. Firstly- the ‘volunteers’ in these organizations are not trained to teach people; especially the children still receiving primary education.

Secondly, this act, said to act as a remedy to the frequent and unchecked absenteeism in government schools, is impacting less than 0.02% of the entire population of children (as per a survey conducted by an independent organization). Thirdly, the education imparted is not necessarily the key solution to the lack of mental development that these children face.

The end result is that these NGOs function for the name of it and squander funds allocated by the government for personal gains. In 2006, a news reporter busted an NGO in which the ‘founder members’ had taken massive grants from the government in the name of promotion of education by building a school and had instead set up a factory on that land.

Another point that works against these unions is that they suffer from similar red-tapism and corruption that the bureaucracy faces. As per government norms, an individual or a group of individuals can ‘adopt’ a government school under an NGO and provide it with the necessities it lacks due to delayed government procedures. An example is that if the school requires 7 fans- the grant for which may take years if taken from the government- can be provided by those individuals. However, since these schools are generally controlled by the NGOs, a lot of ‘donation’ to the NGO and purposeful lengthening of the procedure failing to agree to the same is platitudinous.

All this raises a significant question- are NGOs really necessary? It is said that too much of anything is bad. Maybe, the same is true for NGOs. The fact that there are too many of them in the market has made them turn into a money minting factory rather than unions working for promotion of interests of the masses. The government needs a comprehensive check. Tax payer’s money should not and– more importantly– cannot be spent in such ineffectuality.