Saturday, 12 July 2014

Intra-India Fund flows, Interest earned & Return on Investments of FCRA-Orgs

In earlier Posts, we saw details of receipts of the nearly 22,000 Organizations (huge majority of them being NGOs while some are GOs) from foreign organizations, foreign individuals etc.. via FCRA.

In this Post, we shall see some details on the “earnings” of such Organizations by way of Bank Interest, by way of Return on Investments. We will also learn about the quantum of FCRA money which is circulated within India itself. These are the three objectives. As in the past, we shall see break-up of these three quantities over the last seven years and also over different States of India.

The procedure we adopt is quite similar to what was described in an earlier Post. The specific Unix script changes only a little bit. So, I am not going to bore you with that detail. If someone is interested, they can comment and I can answer.

Let us learn it through an example. Consider Shalom Global Foundation (SGF) located in 7/2-97, Anandammal Shopping Complex, Inam, Karisalkulam Post, Srivilliputhur Taluk, Virudhunagar (Kamarajar District), Tamil Nadu-626125. Its website is: http://shalomglobalfoundation.org/ and its FC6 return for 2011-2012 is at http://fcraonline.nic.in/fc3_verify.aspx?RCN=076110031R&by=2011-2012.

I give below a small portion of its FC6 return.



The total amount that SGF received as fresh funds (either from abroad or from other FCRA registrants within India) is boxed in Blue colour and is Rs. 4.21 Crore. Apart from this, SGF had two other sources of funds. Marked in Red is the Interest earned in that year by SGF for the money that was present in its FCRA-designated Bank account. Marked in green is the amount it earned on the money it had invested, say, in Fixed Deposits etc.. during that year. Needless to state, FCRA rules forbid an Organization to invest in speculative investments such as shares, mutual funds etc..

Let us see one more picture cut from the same FC6 return.


This is present at the end of the FC-6 return. It lists the various countries from which SGF received funds in that year, and the respective amounts. We had already seen a detailed post analysing such data. Of interest to us, currently is the entry for “India”, marked in a black rectangle. FCRA stands for Foreign Contribution Regulatory Act. Yet, how can India be a “foreign” contributor? One may ask, thus.

It turns out that Organizations registered for FCRA can in turn, remit the funds that they received (say, from abroad) to other FCRA-registered Organizations in India. Yes, it sounds bizarre. Can we throw our hands up? We cannot. So, let us plough on and analyze this intra-India fund amounts as well.

What are we going to do?

Part-A: Interest Earned


We shall add up the red boxes for all the Organizations located in a given State. For instance, 3285 Organizations located in Tamil Nadu reported FC6 returns in 2011-2012. We shall put a Red Box in each of their FC6 return of 2011-12 and add up all those numbers. Repeat this process for each year. Thus, we obtain the Interest earned by Organizations in Tamil Nadu over all the seven years. We do this for other States as well. The result is shown below:
 
Table 1: Interest earned by Organizations in the Bank Account maintained for foreign fund receipts via FCRA
State\Year 2006 2007 2008 2009 2010 2011 2012

Amount
in Crores


TN 10.396 11.423 16.255 16.921 10.610 16.090 21.268
AP 4.488 5.490 7.476 8.417 7.348 8.178 10.546
KL 3.900 5.577 4.811 13.904 21.107 9.528 8.495
KA 6.367 7.774 10.475 8.447 10.585 13.609 14.880
MH 8.006 5.295 8.981 11.327 9.302 17.496 9.492
MP 1.007 0.893 0.935 12.679 2.100 12.883 36.411
OR 0.931 1.054 1.324 1.594 1.481 1.993 1.878
WB 3.196 3.651 3.417 4.670 4.780 5.784 5.437
DL 8.144 10.315 12.013 14.985 10.981 22.437 23.850
UP 3.412 2.541 1.890 1.387 1.998 2.401 3.078
UK 1.252 0.384 0.593 1.074 2.652 4.921 1.389
HR 0.192 0.220 0.265 0.227 0.247 0.492 0.172
PJ 0.445 2.089 2.581 3.345 0.531 1.451 1.928
RJ 0.787 0.899 1.022 0.931 1.227 1.453 1.586
BH 0.806 0.764 1.008 0.932 1.458 6.827 1.307
HP 0.406 0.427 1.204 1.192 1.180 5.580 2.948
MZ 0.012 0.012 0.026 0.035 0.028 0.024 0.024
ML 0.260 0.276 0.529 0.406 1.319 0.540 0.451
MN 0.102 0.126 0.143 0.141 0.198 0.173 2.408
AS 0.469 0.952 0.581 0.587 0.611 0.749 0.804
Total 54.579 60.159 75.528 103.201 89.743 132.609 148.351



PART-B: Return on Investments:

Let us repeat this process for the Green box, which was the money earned by Organizations through Investments. The following is the result.


Table 2: Return (gain) on Investments made by Organizations by way of Fixed Deposits etc.. on Foreign funds received via FCRA
State\Year 2006 2007 2008 2009 2010 2011 2012

Amount
in Crores


TN 33.160 58.464 54.666 89.381 67.487 97.108 69.465
AP 60.323 77.532 73.782 113.759 60.153 133.584 72.524
KL 26.870 42.700 61.532 58.769 57.477 111.906 127.550
KA 34.387 31.684 26.356 30.946 39.593 34.824 36.447
MH 40.620 28.551 52.503 72.705 75.688 94.372 96.728
MP 12.444 12.319 7.514 5.218 17.988 4.600 3.193
OR 4.175 4.088 5.441 6.027 5.201 3.595 8.195
WB 27.969 33.205 15.606 17.261 21.034 16.439 24.647
DL 47.877 60.589 58.599 76.313 101.831 102.041 114.182
UP 6.709 12.045 8.061 14.219 21.399 31.249 9.840
UK 3.159 5.045 7.628 7.132 5.960 8.143 10.755
HR 0.593 0.678 1.439 1.522 0.758 1.266 1.203
PJ 2.628 5.462 2.140 3.376 23.030 4.761 5.132
RJ 1.424 1.684 2.688 2.758 2.861 4.158 4.149
BH 11.206 10.832 12.066 10.249 18.185 28.102 17.926
HP 4.643 7.281 8.608 9.940 7.709 6.046 10.436
MZ 0.028 0.051 0.016 0.009 0.000 0.000 0.000
ML 0.783 0.963 0.933 1.164 0.974 2.682 1.763
MN 0.061 0.332 0.299 0.257 0.422 0.239 0.047
AS 0.653 1.356 1.462 2.152 1.619 4.599 5.304
Total 319.711 394.863 401.338 523.158 529.369 689.715 619.488


Thus, if Rs. 600 Crore is the return on Investments (such as Fixed Deposits etc..), one can assume that the amount invested by these Organizations will be around Rs. 6000 Crore. Yes, that is the aggregate amount invested by Organizations (mostly NGOs) which received money from abroad via FCRA for activities ranging from upliftment of India, empowerment of Indians, teaching Indians, disseminating the message of Good Will among Indians etc..

PART-C: Intra-India Fund Flows
The last item we shall study is the quantum of fund flows within India. We shall add the numbers provided in the black boxes of FC6 returns of Organizations present in a given State for a given year. The result is


Table 3: Quantum of money received by Organizations in a given State from other Organizations within India. It includes interest amount (Part-A) and Return on Investments (Part-B) listed in Tables 1 and 2.
 
State\Year 2006 2007 2008 2009 2010 2011 2012

Amount
in Crores


TN 350.959 308.501 259.556 288.250 234.155 281.260 245.003
AP 204.911 233.489 213.847 268.187 203.532 271.491 189.272
KL 143.132 124.815 156.578 164.980 165.415 213.907 241.034
KA 367.216 110.128 127.817 145.690 156.696 155.785 177.989
MH 139.560 99.720 172.027 212.083 208.889 257.835 255.998
MP 37.352 40.130 35.426 47.548 45.713 50.004 71.476
OR 91.845 40.856 53.281 54.084 53.852 70.551 65.589
WB 418.606 127.506 119.243 112.620 174.175 136.509 136.500
DL 185.927 206.726 311.045 245.300 304.360 349.291 391.926
UP 60.599 64.514 67.764 68.967 76.774 95.325 71.113
UK 11.617 11.109 20.712 17.408 24.948 30.016 30.862
HR 1.562 1.421 2.638 2.329 1.648 2.868 1.956
PJ 6.789 12.950 6.589 12.334 28.351 8.593 13.329
RJ 32.265 20.063 27.552 32.193 36.563 42.791 45.287
BH 27.408 38.153 49.448 43.154 52.985 71.753 56.647
HP 17.340 23.116 30.083 32.493 25.553 29.956 39.877
MZ 0.756 0.842 2.689 2.235 1.188 1.224 1.363
ML 8.181 5.951 7.039 9.873 9.638 9.677 9.786
MN 4.670 8.147 5.745 5.335 9.429 8.214 7.568
AS 12.316 17.945 17.468 22.923 20.237 28.373 32.452
Total 2123.010 1496.080 1686.547 1787.987 1834.099 2115.421 2085.027


As is remarked in the caption to Table 3, this amount includes money "earned" by the Organization within India -- via Bank Interest and Return on Investments. Thus, in order to obtain an understanding of the magnitude of intra-India fund flows (i.e., money transfers from one Organization to another), we need to subtract these amounts from those in Table 3. i.e., we need to do:

Table 4 = Table 3 - Table 1 - Table 2

If we do that, we obtain the following result:


Table 4: Exact amounts of funds received by organizations located in a given State from other FCRA-registered Organizations in India.

State\Year 2006 2007 2008 2009 2010 2011 2012
TN 307.403 238.614 188.636 181.948 156.058 168.061 154.270
AP 140.100 150.467 132.589 146.011 136.031 129.729 106.202
KL 112.362 76.539 90.236 92.308 86.831 92.473 104.989
KA 326.462 70.670 90.987 106.296 106.518 107.352 126.662
MH 90.934 65.873 110.543 128.052 123.899 145.967 149.778
MP 23.901 26.918 26.977 29.651 25.624 32.521 31.872
OR 86.739 35.714 46.516 46.462 47.169 64.963 55.516
WB 387.441 90.650 100.220 90.690 148.361 114.286 106.416
DL 129.905 135.822 240.432 154.003 191.548 224.813 253.894
UP 50.478 49.928 57.813 53.361 53.376 61.675 58.194
UK 7.205 5.680 12.491 9.202 16.336 16.951 18.719
HR 0.777 0.523 0.934 0.579 0.644 1.109 0.580
PJ 3.716 5.399 1.868 5.613 4.791 2.381 6.269
RJ 30.054 17.480 23.842 28.503 32.474 37.179 39.552
BH 15.396 26.557 36.374 31.973 33.342 36.824 37.414
HP 12.291 15.409 20.270 21.362 16.664 18.331 26.494
MZ 0.716 0.780 2.647 2.191 1.159 1.200 1.339
ML 7.138 4.711 5.577 8.303 7.345 6.454 7.572
MN 4.507 7.689 5.303 4.937 8.809 7.801 5.112
AS 11.194 15.636 15.425 20.184 18.007 23.025 26.344
Total 1748.720 1041.058 1209.680 1161.629 1214.986 1293.097 1317.187


Rs. 10,500 Crore is the approximate amount coming to these Organizations in each year, via FCRA. The quantum of funds going around within India is around 10-15% of that. Why does this happen? Who sends and receives?
You can get a feel for the answer in the FC6 return of SGF I linked way above. It received Rs. 0.209 Crore from Caruna Bal Vikas, Chennai (which is associated strongly with Compassion International, USA). Fine. Has it sent money to other Organizations in India? May be, but to figure that out, we have to examine the FC6 returns of the recipient Organizations. Not impossible to find that. However, one can glean some information from the FC6 return of SGF itself. I have given a short snippet below:



(Thanks to tweeple @kshetragnya for alerting me to look at the above Activities list.)
Sitting way down South in Srivilliputhur, SGF has been quite active in spending money way up North in many States. Again, many of us may not have even heard of Shalom Global Foundation; it is only in awe that one can watch its footprint and reach.
What is the nature of Organizations which sends out funds? They play the role of a local leader (“Control” Organizations, as I described them on twitter); they receive money from abroad and disburse it within India to other Organizations. Let us look at the Table of numbers again. In 2012, We see that Tamil Nadu (which receives around Rs. 1600 Crore p.a.) got only 150 Crore (Table 4) from within India. The contribution from within India has been decreasing with time as well. Thus, one can say that Organizations in Tamil Nadu disburse money rather than receive money. Same conclusion applies for Kerala as well, which receives around Rs. 800-900 Crore p.a. (See my Post here for details on total receipts). Andhra Pradesh too has many such "Control" Organizations and hence intra-India fund share is only about 10% of its total receipts. 
To me, the interesting (in a sad way) item is West Bengal. Its numbers too have been decreasing with time (while its overall receipts via FCRA have been increasing). This means that its NGOs (a majority of which are, needless to state, Evangelical in character) are "maturing".
Caveat: Can the intra-India fund flows shown in Table 4 have had multiple counting? Say, X receives money from Y in 2011 and “returns” it back to Y in 2012 (sort of like a loan). Will the above analysis count that money as part of X's receipts in 2011 and of Y's receipts in 2012? It will. Do such events (money-lending) happen? I have no idea.
Well, I am done with this Post. It is summary time.

Summary:
  1. Organizations gain ~ Rs. 150 Crore by way of interest each year.
  2. Organizations gain ~ Rs. 600 Crore by way of Return on Investments each year. Thus, they are likely to have invested around Rs. 6000 Crore in Fixed Deposits etc..
  3. Quite a bit of intra-India flows of FCRA-derived funds take place.
Source and Acknowledgements:
  • The FCRA data is sourced from the Ministry of Home Affairs site, http://fcraonline.nic.in/fc3_amount.aspx and I thank them for providing the data openly.
  • The 2012-2013 FCRA data continues to be actively updated on the MHA website. Hence the value for 2012-13 above can be taken as a lower bound. The data that I have used is correct for returns filed up to February 2014.
  • All errors are mine. I would appreciate if any errors/omissions can be pointed out. Thanks.
Update on September 6, 2014:
  1. Due to an error (my mistake) in the URLs used for the downloading of FC-6 returns for Bihar (BH in Tables above), all values in rows corresponding to BH were zero, in the earlier version of this Post. This error was noticed and has been fixed in the Table now. Consequently, the total amounts in each column have also been updated.
  2. During this update, I have also changed the format of the Tables to native HTML rather than the image (.png) format used earlier.

1 comment:

  1. Sincerely appreciate your stupendous efforts - now correlating this with the societal and cultural damage done over the years would be really worthwhile - more so proving beyond doubt the myth of 'progress' or 'development' that these tricksters profess to bring about.....

    yeah... the graphs and tables are very clear!!

    ReplyDelete