From 16 to 19 February 2004, Bangladesh will hold the Asia/Pacific Regional Microcredit Summit Meeting of Councils. During the same period, Bangladesh National Party (BNP) and Jamaat-I-Islami government may table The Foreign Donations (Voluntary Activities) Regulation (Amendment) Bill of 2004 – the new instrument to make all the NGOs government Organised NGOs (GONGOs) – before the parliament. After a series of attacks on minorities in the aftermath of 1 October 2001 general elections, the Operation Clean Heart of 2002, Joint Drive Indemnity Act of 2003, continued attacks on press freedom and journalists, recent ban of Ahmedia publications and continued human rights violations of indigenous peoples, the BNP-Jamaat government has launched the final assault against the voices, which sometimes dissent.

The Foreign Donations (Voluntary Activities) Regulation Ordinance is a product of the military regimes. It was promulgated by military dictator, General Zia-ur Rahman on 15 November 1978 to suppress all forms of opposition and dissent. On 12 December 1978, the Foreign Donations (Voluntary Activities) Regulation Rules were promulgated requiring all NGOs intending to receive foreign funds to be registered under specified prescribed rules. Another military dictator, General H M Ershad promulgated the Foreign Contributions (Regulations) Ordinance on 6 September 1982 which reiterated that no individual representing NGOs or the organisations themselves would be allowed to give or receive 'any foreign contribution without prior permission from the state.

NGOs play critical role in poverty reduction programmes in Bangladesh. According to a study conducted by the Asian Development Bank of 1999, NGOs receive 15% of the total aid for poverty reduction and work in 78% of the total villages in Bangladesh. ADB further stated, “During the last decade, about 100 NGOs disbursed an estimated US$ 1 billion among 3.5 million borrowers”. [1] Not surprisingly, the NGO Affairs Bureau is under the direct control of the Prime Minister’s Office.

In a country where the daughter of Bangladesh liberation hero, Sheikh Mujibur Rahman and the wife of a military dictator, General Zia-Ur Rahamn shape the contours of national politics, how could the NGOs remain unaffected? The NGOs are often formed and run by the elites of the country. Individual links of the NGO activists with political leaders or alliance with a particular political party – which sometimes reflect the personal relations of the elites - is a commonplace. Prime Minister Khaleda Zia speaking before a gathering of NGOs sympathetic to her Bangladesh National Party government attacked the NGOs who allegedly distributed leaflets, video and audio-cassette tapes supportive of the rival Awami League government in the run up to the October 2001 general elections. [2]

Analysis of the Foreign Donations (Voluntary Activities) Regulation (Amendment) Bill, 2004

The proposed "The Foreign Donations (Voluntary Activities) Regulation (Amendment) Bill 2004” (FDVARA Bill of 2004) is a draconian piece of legislation to control NGOs, which appears most suited for the totalitarian regimes. It defines "irregularity" to include "incurring expenditure against activities not approved under project, or incurring expenditure against approved activities in excess of budget provision beyond acceptable limits as is determined by government, or violation of the financial discipline of the organization, or any provisions of this ordinance or any rules or orders made there under”. The government acts as the judge and jury to determine what constitutes “irregularity”, “acceptable limits” as it seeks to control and micro-manage the NGOs. [3]

Under the proposed FDVARA Bill of 2004, the government prohibits "political activity" by NGOs. "Political activity" is defined as "accepting membership of, directly supporting or getting aligned with any political party, and includes any activity which may be interpreted as political or, may affect politics or such other activities which may be interpreted to be detrimental to national independence, sovereignty, culture, ethnic and religious sentiment, etc, and shall not include activities like empowerment of poor and disadvantaged, awareness raising, etc, as long as those are not intended towards giving any direct political gain to any political party." [4]   Political activity is so vaguely defined that any activity could be termed as political. The action of women rights groups or Ahmedias could be termed as detrimental to religious sentiments.

The proposed FDVARA Bill of 2004 also empowers the government to remove the chief executive or any other official of the registered NGOs if it is satisfied that they have been “responsible for any irregularity in respect of its funds or for any mal-administration in the conduct of its affairs, or has failed to comply with the provisions of the ordinance, or the rules made there under, or any order issued by the government in this regard, or has caused the organisation to be involved in any political activity, or any activity influencing politics directly”. No government or authority can possibly ask for more sweeping powers over the internal affairs of the NGOs, which are supposed to be non-governmental! [5]

The proposed FDVARA Bill of 2004 also empowers the government to cancel registration of NGOs and their dissolution. After registration is cancelled, assets of NGOs can be frozen and a liquidator can be appointed to take care of the NGOs’ financial and legal affairs. [6] The procedures to take over the NGOs are complete.

Grey Areas: NGOs' family of enterprises

Over 10 million poor families are under the micro-credit network and women constitute 90 percent of the borrowers. [7] There have been consistent accusations of those running micro-credit schemes of charging from 25 to 40 percent interest from impoverished borrowers. [8]

As the charitable NGOs gradually became neo-corporates in Bangladesh, various chambers of commerce have been urging the governments to bring NGOs involved in profitable business activities under existing tax structures. Many NGOs have become owners of banks, hospitals, real estate, telephone systems, shopping complexes, industries and shipping lines.

The Grameen Bank, the showpiece of success of micro-credit programmes is the best example. The “Grameen Family of Enterprises” has become fully commercial although they claim to be non-profit making companies. The Grameen family of enterprises consists of (1) Grameen Trust which provides micro-credit, (2) Grameen Fund - a "not-for-profit" company which provides finances “to ventures that are risky, technology - oriented and otherwise deprived of financing from existing formal lending institutions”, (3) Grameen Communications which provides “complete systems solution through developing software products and services, internet services, hardware & networking services and IT education services”, (4) Grameen Shakti/Energy which supplies renewable energy to unelectrified villages in Bangladesh, (5) Grameen Shikkha which provides “financial support in the form of loans and grants for the purpose of education, use IT for alleviation of illiteracy and development of education, promote new technologies and innovate ideas and methods for development of education etc”, (6) Grameen Telecom brings the information revolution to the rural people of Bangladesh with a plan “to provide GSM 900/1100 cellular mobile phone service to 100 million rural inhabitants in 68,000 villages of Bangladesh by  financing 60,000 members of Grameen Bank to provide village pay phone service and  providing direct phones to potential subscribers in the next four years, (7) Grameen Knitwear Limited  - a company is a 100% export oriented composite knitwear factory, located in the Export Processing Zone in Savar in the vicinity of Dhaka and (8) Grameen Cybernet Ltd, which is the Bangladesh's leader in Internet service provision. [9] To term the Grameen family of enterprises as NGOs would be misnomer.

Another big NGO, Bangladesh Rural Advancement Committee (BRAC) is alleged to be running successful businesses like a commercial organisation. BRAC's cold storage, press, a marketing organisation named "Aarong" – famous for selling the ethnic stuffs for the tourists in Dhaka, a real estate company and a restaurant are highly profitable. BRAC has received state approval to open a commercial bank for micro-lending. [10] Similar allegations have been made against Association of Development Agencies in Bangladesh (ADAB), PROSHIKA and Ganosastha Kendro. [11]

Witch-hunting

Corporate activities by poverty reduction NGOs are not new in Bangladesh. The FDVARA Bill 2004 has more to do with controlling dissent and taking over NGOs. Immediately after coming to power, Bangladesh National Party and Jamaat-I-Islami government started witch-hunting of about 100 NGOs for being sympathetic to the previous Awami League government and started an inquiry. [12] In early March 2003, the government of Bangladesh blocked funding of US$61.70 million to among others, PROSHIKA, International Voluntary Services, Bangladesh Nari Pragati Sangha and Center for Development Services. [13]

The proposed Foreign Donations (Voluntary Activities) Regulation (Amendment) Act of 2004 is antithetical to the UN Declaration on the Rights and Responsibilities of Individuals, Groups and Organs of Society to Protect Universally Recognized Human Rights and Fundamental Freedoms (the Human Rights Defenders Declaration). The UN Secretary-General's Special Representative on Human Rights Defenders, Hina Jilani in her report to the 58^th session of the Commission on Human Rights stated that “the use of laws that could restrict access to resources for the promotion and protection of human rights and could be used for penalizing human rights defenders for soliciting, receiving and utilizing funds for this human rights activity." [14]

By their very nature, NGOs must be free of executive control or influence. Bringing NGOs that are engaged in commercial activities under commercial tax bracket is different from developing mechanisms to take over the NGOs. Mainstream Bangladeshi NGOs maintained silence against the gross human rights violations of indigenous Jumma peoples in the Chittagong Hill Tracts, among others, for the fear of the NGO Affairs Bureau stalling funding. If the Foreign Donations (Voluntary Activities) Regulation (Amendment) Bill of 2004 is adopted, the executive caprice will prevail. The government irrespective of whichever party is in power will attack the NGOs, which are perceived to be supporting the rival parties. As the elites fight, the poor – individuals and NGOs - suffer. In a country where there is little opportunities for raising domestic funds, if the proposed Bill is adopted, NGOs must either toe the government line and become GONGOs or be prepared to be taken over by the government.