From the archives

The rise of NGO's and their harmful impact on Pakistan

Updated Aug 11, 2016 01:01am

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Victims of the 2005 earthquake seek medical support | White Star
Victims of the 2005 earthquake seek medical support | White Star


The extraordinary growth that NGOs have experienced in recent years in their numbers, their outreach and their resources is unprecedented even by Pakistani standards. The number of active NGOs in the country is, at the very least, anywhere between 100,000 to 150,000, investigations by the Pakistan Centre for Philanthropy (PCP), a certification organisation for NGOs and charity institutions, reveal. By this count, there is at least one NGO for every 2,000 people. Way back in 2001, a Civil Society Index put together by the Aga Khan Foundation in Pakistan, in coordination with Civicus, an international alliance of civil society groups, put the number of “active and registered NGOs in Pakistan” at “around 10,000 to 12,000”.

The phenomenal rise in the number of NGOs could be linked to the massive injection of foreign money, especially donations and grants – and sometimes even loans – into Pakistan since 2001 (the United States alone has provided more than 10 billion dollars during these years). A major part of this money came into Pakistan due to the peculiar political and economic situation in the country. We have been through multiple violent conflicts during the last decade and a half; we have been transitioning from a dictatorship to a controlled democracy to a fully functional democracy, and our economy has been undergoing massive liberalisation. All this necessitated that foreigners came in to help with expertise and money to take Pakistan and Pakistanis through this troubled period of our history.

It is also during these years that the country has suffered its worst natural disasters in decades – an earthquake in 2005, floods in 2010-2011. Coupled with long-term deterioration in the quality of environment standards and the need to have a sustainable model of development that could create a balance between a burgeoning population and depleting natural resources, these disasters focused the attention of the international development community towards Pakistan like never before. And together these political, economic and environmental issues have resulted in foreign money coming into Pakistan in buckets and leaving in its wake an NGO at every step.



It was under General Ziaul Haq’s military rule, or the years just following it, that some of the earliest and most well known NGOs in Pakistan came about. Almost all of them have their origins in some long-standing people’s struggle against dictatorship and in support of human freedoms, including freedom of speech, expression and assembly, workers’ rights, women’s rights and rights of non-Muslim Pakistanis. Shirkat Gah, which researches issues linked to women’s welfare, their rights and their place in society; Aurat Foundation, a leading institution raising awareness about women’s issues; Ajoka, a theatre group which first began performing under the Zia regime and the Human Rights Commission of Pakistan which plays a prominent role in championing human rights in the country — all these essentially were the creation of people who somehow or the other were linked to political and social struggles in these fields. These organisations, and many others like them, have unsurprisingly become synonymous with progressive, liberal, democratic ideals.

At the other end of the spectrum are a number of Pakistani NGOs which have made an international name for themselves by delivering services which the state has failed to provide. The most respectable of these is Akhter Hameed Khan’s Orangi Pilot Project (OPP). Having delivered one of the most successful NGO-led projects in Pakistan, the OPP has used an exemplary strategy to foster awareness and community participation to achieve much needed development goals. Since its inception in 1980, it has helped over a million people in Karachi improve sanitation in their neighbourhood. Prior to the project, the primary means of sewage disposal in the city’s Orangi area were bucket latrines or soak pits and open sewers.


A state that withdraws itself from providing essential social services such as education, health and sanitation and a private sector that is selfishly focused on profit maximisation leave a lot of room for a third sector. Call it civil society, the development sector or the non-profit sector, the rise of this third sector has happened alongside the rise of market-based economic fundamentalism and the reduction of the state’s role in the social development sphere throughout the third world, starting in the late 1980s and reaching its climax in the middle of the 1990s.

But what exactly constitutes the third sector? Part of the problem in answering this question, especially in Pakistan’s case, arises from the lack of data and an inability to categorise what civil society is and what it is not. (Are religious madrasas part of civil society, since they are neither part of the state nor operate as private businesses?) . “Although several initiatives have been launched during the 1990s to collect data on various dimensions of the civil society, no comprehensive analysis has been undertaken so far. The available data are sketchy and sector- or area-specific, most of them focusing on NGOs,” the compilers of the 2001 Civil Society Index pointed out.

Such focus on NGOs, as mentioned in the index, has made civil society synonymous with NGOs — in Pakistan, as well as in most of the third world. Many academics feel NGOs are actually part of the neo-liberal agenda to roll back the state, open international borders for globalised commerce, deregulate labour markets to make hiring and firing easy and push all service provision into the hands of the private sector. In such a situation, the third sector no longer remains distinct from the public and the private sectors.

“Our civil society has become hegemonic in itself. Certain highly funded NGOs and consortiums of NGOs dominate the civil society scene to such an extent that even the state seems much less powerful as compared to them,” says Dr Rubina Saigol, a Lahore-based sociologist and independent analyst who has vast experience of working with the third sector. Whereas civil society, as a broad term, is understood to play an important role in pushing society towards an egalitarian and progressive path, in its NGO avatar it is no longer just an informal or incidental component of society. It, indeed, is another word for highly bureaucratised institutions, with a lot of resources to do good work but suffering from all the ills that bureaucracy brings in its wake: inertia, mismanagement and corruption.

“No one knows how many NGOs are functioning in Pakistan,”a PCP spokesperson tells the Herald. “No one really has any idea of the [size of the] non-profit sector.”

One of the first problems in Pakistan vis-à-vis the third sector is knowing its exact breadth. “No one knows how many NGOs are functioning in Pakistan,”a PCP spokesperson tells the Herald. “No one really has any idea of the [size of the] non-profit sector.”

If money is any guide, charitable NGOs, which live on the generosity of local donors, receive an estimated 70 billion rupees every year, according to Malik Babur Javed, a senior programme manager at PCP. These organisations do not include all those thousands of NGOs which receive money from the Pakistani government, international charities, the governments of other countries and multilateral forums like the United Nations institutions.

Sadiqa Salahuddin, the director of Karachi-based NGO Indus Resource Centre, which has been active in poverty alleviation and disaster relief and mitigation in rural Sindh for more than 20 years, says the presence of large amounts of money creates major issues of both capacity and corruption within NGOs, even when they genuinely want to carry out development activities. She cites the instance of her own NGO which received an unprecedented amount of funds to provide relief to the victims of the 2010 floods.

The disaster called for quick disbursal and management of vast resources which her NGO was not prepared for, she says. Having her base in Karachi but working in Dadu district, she found coordination and management a tough task. “It drove me crazy. I would go to Dadu myself every week.” Even this was not always helpful. In one instance, going through the statement of expenses spent on flood relief, she found “83,000 rupees spent on toothpastes”. She would find many errors in computation of prices and other procedural irregularities, simply because she did not have enough skilled and motivated staff to handle such assignments in a challenging post-disaster environment.

Shelter provided by NGOs after the 2005 earthquake | Arif Mahmood, White Star
Shelter provided by NGOs after the 2005 earthquake | Arif Mahmood, White Star

The problem gets even more acute with smaller and less experienced NGOs. When a donor provides a big sum of money to a small NGO working in a village, it leaves that NGO flummoxed. Having never before handled the kind of money it lands on, the NGO cannot put in place financial systems ready to handle huge cash flows, says Salahuddin. It also cannot employ skilled staff to achieve targets preset by donors, which are to be achieved in a short span of time, she adds. This inevitably results in wastage, poor record-keeping, ill-executed projects and even pilferage. In many cases, donors had to blacklist NGOs they had been working with for years before the floods. Another insider tells the Herald how relief goods provided by international NGOs (INGOs) through local NGOs, for victims of natural disasters, end up in the market for sale. “All INGOs have an agreement with the ministry of finance that all products they bring into the country from abroad for distribution and for use by NGOs will not attract custom duties,” he says. Such duty waivers make these products attractive for private buyers, providing a perfect incentive for NGO employees to sell them in the market and pocket the money, he adds.

Khadim Hussain, who has worked with many INGOs in Pakistan, tells the Herald how some local NGOs sometimes do not have the institutional resources to spend even a fraction of the funds they receive. The country director of a leading international charitable organisation working in Islamabad used to dole out 20 to 30 million rupees to NGOs which could not use even 20 per cent of the money, he says. “The same organisation had to cancel three agreements with local NGOs when there was incidence of money being swept away without accountability,” Hussain reveals, adding that in some such cases those in power at the INGOs and donor organisations force their own staff to look the other way. When this happens, NGOs start resembling public-sector institutions or private businesses, he argues.

When a donor provides a big sum of money to a small NGO working in a village, it leaves that NGO flummoxed. Having never before handled the kind of money it lands on, the NGO cannot put in place financial systems ready to handle huge cash flows, says Salahuddin.

In some cases, revealed by those working for INGOs, the level of institutional arrangements between local NGOs and their donors are too weak to channel big amounts of money. An official working with the health sector in Khyber Pakhtunkhwa – on a United States Agency for International Development (USAID)-funded pilot project – could not hire staff for a good four months after the project started last year because his partner NGOs did not have any real stakes in the project. In the last financial year, the provincial health department had to return a quarter of a million dollars back to the donors because the money could not be used due to similar problems.

Of course, such systemic weaknesses cannot be wholly ascribed to corrupt practices by NGOs or the political agendas of the donors. But their impact is immediately felt in the form of missing development work that otherwise should have been carried out. A press release announcing that USAID will provide 1.6 billion dollars to Pakistan for development activities over a five year period will be carried in all international newspapers and could be seen as a way to disburse the money in a transparent manner, but there won’t be any headlines when that money is stuck at a high level programme director’s office, not converted into the amenities or infrastructure that it was meant for, such as schools or hospitals. “This is where a lot of NGOs are not as effective as they could be because of poor systems and governance,” says a development activist without wanting to be named.

The sustainability of NGO-driven projects is another major problem. Mustafa Talpur, a senior staff member at Oxfam, a British charity working in Pakistan since 1973, says there is hardly any project in the country that has received donor support over a sustained long-term time frame. When WaterAid (founded in 1981 to ensure the provision of clean and safe drinking water) set up its rainwater harvesting project in the desert of Thar, it was not the first NGO to do so. Many ponds to harvest rain already existed in the area but their sandy banks had caved in and they could no longer be used to collect rainwater, says Talpur. “When local people were asked why they did not use those ponds anymore or why they did nothing for their upkeep, they replied that the NGOs which had dug the ponds had left without ensuring that they remained operational,” he tells the Herald. Talpur stresses that only continuity of investment by donors and active citizen participation can ensure institutional accountability and bring sustainability to development programmes.

There are, however, some notable exceptions to this, with OPP’s work in Karachi being the most prominent. Similarly, the work of the Aga Khan Foundation in northern Pakistan offers a successful model of sustainable projects in livelihood creation, archaeological conservation and environment management.

The flip side of the problem of mismanagement is over-bureaucratisation of NGOs which results in inefficiency and inertia. Many donors and their local partners sometimes incorrectly overemphasise institutionalisation over effective service delivery. Some of them actually want NGOs to replicate corporate administrative structures so as to effectively take care of cash flows and other human resource problems. Saigol points out that such bureaucratisation and corporatisation of NGOs “has entrenched new bureaucracies similar to the ones that the state has and which are equally cumbersome and inefficient.”

She also explains how “NGOs engaged in service delivery are taking up the role of the state and thus enabling the state to abdicate its responsibility towards its citizens”. The NGOs playing a big role in delivering services such as health and education belie the distinction between voicing the concerns of citizens – which is the function of civil society – and taking care of citizens, which is the responsibility of the government. An active civil society and a responsible government, academics point out, are both features of a democratic and forward-looking society. When NGOs are seen to possess more resources to deliver services while at the same time still claiming to be a part of civil society, they are mixing the two factors and produce outcomes which are not always helpful. One obvious result of the over-resourcefulness of NGOs is that the state itself starts relying upon them, for example, to carry out research or data collection.

This, Saigol says, confuses the whole idea of the third sector. “The idea that NGOs constitute a middle space between the public sector on the one hand and the private sector on the other, is problematic. It was thought that they would be free of the profiteering and corporate methods of the private sector and the corruption of the public one. But in reality, NGOs have both features, a tendency to go after corporate salaries and perks as well as the tendency towards less transparency and accountability than is desirable.”

Victims of the 2010 floods | White Star
Victims of the 2010 floods | White Star


Civil society as a whole, and NGOs as a major part of it, have successfully campaigned to make human rights discourse and environmental issues a part of mainstream political agendas. They have also been instrumental in bringing into the limelight issues such as gender-based and religiously driven segregation and discrimination, besides creating public awareness on issues pertaining to health, education and sanitation. But most importantly, they have been leading public opinion on the need to hold public representatives and government officials accountable, and on demanding transparency and rule of law in government postings, awards of public sector contracts and the allocation and disbursal of public money.

“When it came to policy making, the voice of the citizens was absent and it was crucial for this voice to be present. This gap was basically filled by NGOs,” says Salahuddin, as she expounds on the role NGOs have played in raising awareness on issues important to a functioning, accountable and democratic system of governance. She says NGOs have held elected representatives accountable and answerable on issues such as the number of out-of-school children in their constituencies, the quality of education provided by schools in their areas and problems such as ghost schools and school buildings being used as barns. “Bringing such issues to attention is most certainly the work of NGOs.”

Critics have been quick to point out that NGOs themselves don’t practice what they preach. They say NGOs avoid accountability and transparency as much as they possibly can and, therefore, are quite averse to any form of regulation or oversight.

Critics have been quick to point out that NGOs themselves don’t practice what they preach. They say NGOs avoid accountability and transparency as much as they possibly can and, therefore, are quite averse to any form of regulation or oversight. With some large NGOs having become heavily corporatised entities, where staff earn market-based salaries and where foreign money flows in regularly, it is natural to expect some kind of transparency and accountability — to be able to ask if all those salaries are being paid to the right people and for the right purposes as well as to ensure that foreign funds are spent on the projects they are meant for.

It is not easy to do such things in an unregulated and undocumented sector, which the NGO sector has so far been in Pakistan. There is no countrywide or even province-wide institution in the government sector which has the authority or ability to oversee the registration of NGOs, to monitor their flow of funds and regulate their activities and projects. When, in the past, governments have talked about bringing in any legislation in this regard, NGOs have been quick to term such efforts as politically-motivated curbs on their freedom to act.

There can be some truth in their argument. Many NGOs are working on projects – such as reproductive health, the education of girls, etc – which some political parties or their governments may not endorse due to ideological reasons. If there exists a strong government regulatory body to oversee the working of NGOs, the fate of such projects and the NGOs working on them will heavily depend on whether a government approves of their work or not.

Still, there has to be some institutional arrangement in place for regulating the third sector. The existing laws for the registration of NGOs are either colonial-era statutes such as the Societies Registration Act (1860) and the Trusts Act (1882), or they are the ones implemented under military dictatorships, such as the Voluntary Social Welfare Agencies Ordinance (1961) and the Companies Ordinance (1984).

According to an inside source, it matters a great deal under which law an NGO is registered since that then determines the structure of the organisation. Registered as a non-profit company under the Companies Ordinance, an organisation may face more accountability since, for example, the ordinance requires the submission of audited annual reports which may help reduce the margin for corruption, the source says. Most other mechanisms for registration do not require the submission of annual reports and therefore leave room for the misuse of funds.

There is abundant anecdotal evidence that suggests that the lacunae in such laws have allowed the mushrooming of what Talpur calls “family NGOs” where the board of directors and senior staff members all come from either the same family or consist of close relatives and friends. The flaws in the laws have also allowed many NGOs to resurface with new names and under a new registration, but with the same people, after donors or governments blacklisted them for mismanagement or corrupt practices.

Recent incidents at a media-related NGO based in Islamabad highlight some of these problems. When some senior members of its staff registered a for-profit company to invest its savings, others in the organisation could not but see it as corruption though there is nothing in the law that bars the investment of savings in for-profit activities. The end result has been that from the original NGO two different organisations have emerged with different names and different people spearheading them but with almost the same mandate.

Mukhtar Ahmed Ali, an Islamabad-based researcher who has worked extensively on the legal and regulatory aspects of the NGO sector, says the problem with the existing laws is that they were not enacted after a democratic debate. The colonial and dictatorial origins of these laws make them unable to meet the needs of a democratic society, he says. He also argues that the multiple laws for registering an NGO need to be consolidated, registration processes needs to be less cumbersome and the same body that registers NGOs should ensure that the relevant laws are followed after registration.

Absence of accountability sometimes leads NGOs to fund projects which end up achieving results directly opposed to what they had originally aimed for.

For instance, under the existing framework, all NGOs must register with the Security and Exchange Commission of Pakistan (SECP) but it is a known fact that the SECP does not have the capacity to monitor and regulate all the scores of thousands of NGOs all over Pakistan, says Ali. Perhaps a district-based registration set-up would work better, with an online database system put in place in Lahore or Islamabad to monitor whether or not annual reports have been submitted, he adds.

It is in this context that government representatives, foreign donors and local activists together have drafted what they call the Foreign Contribution Bill 2014. Ali, who has been part of the process to draft the bill, says its sole purpose is to curb corruption in the flow of foreign funds. It is not precisely meant for regulating the NGO sector, he adds, implying that NGOs still view government regulation of their activities rather suspiciously.

Absence of accountability sometimes leads NGOs to fund projects which end up achieving results directly opposed to what they had originally aimed for. In a well-known example, an international donor NGO fractured the political will of the very people it was trying to help. In 2000, farmers at a military-owned farm in Okara, Punjab, formed Anjuman Muzareen Punjab (AMP) to resist a new cropping agreement that they saw as hurting their earnings and rights to cultivate the land they had been cultivating for decades. The resistance soon turned into a popular movement, with farmers on other government-owned lands across Punjab joining it in droves. In almost no time, AMP swelled to thousands of members, cutting across gender lines and surpassing religious differences. Christians comprised 40 per cent of the AMP members and women were as active in protests against the new cropping agreement as men were.

It was at this moment that ActionAid, a British charity with vast experience of working in Pakistan, decided to intervene. It thought that it could help the movement with money and institutional support to enable it to raise its voice in a sustained and strong manner. The outcome of its intervention was entirely different. The very first condition of the intervention was that the AMP become an NGO to qualify for receiving money. The scramble for registration pitched some leaders of the movement against others, with the result that a mainly Christian group of farmers broke away from the movement, became an NGO and started receiving donor support.

Earthquake victims wait in line for assistance | Arif Mahmood/White Star
Earthquake victims wait in line for assistance | Arif Mahmood/White Star

Asad Farooq, who teaches law at the Lahore University of Management Sciences (LUMS) and has research interests in areas such as the rights of indigenous communities, sees ActionAid’s intervention as “devastating” and calls it “the NGOisation of the peasant movement”.

With money coming in, soon there were also charges of embezzlement and corruption. All these developments took the focus of the discourse away from the central issue of land rights and changed the entire dynamic of the movement. “What the military and the government failed to do, the NGOs managed to do. They fractured the movement,” Farooq says. This happened, he says, because “the activity of NGOs takes away the history of struggle and the richness of legacy that comes with political struggle.”

Dean Chahim and Aseem Prakash, writing in a 2013 paper on foreign-funded NGOs in Nicaragua, similarly point out that NGO funding is an easy but unhelpful source of support for peoples’ movement. “…in the short term…it is often much simpler and easier for citizens to ask an NGO to fill a need than to mobilise for a long-term, systemic change that is uncertain and difficult to accomplish.”

Quite like what they do with the state and the private sector, the NGOs end up replacing the same grass-roots movements which they are supposed to support, says a source with extensive experience of working in the NGO sector. “They do mobilise and activate people and raise awareness but they do not have the mandate to replace political institutions,” he argues.

Saigol believes the problem is linked to the foreign origin of the money at the disposal of NGOs. Due to foreign funding, NGOs cannot bolster people’s movements, she says. “The agendas of NGOs are set by the donors and not by the people.” This, says another NGO source, results in NGOs “hijacking people’s movements.”

Professor Haider Nizamani, who teaches at the University of British Columbia in Canada, highlighted the same point at a conference in Islamabad in December 2013 when he stressed the need to scrutinise the results and effects of rural development through NGOs on the women they mean to empower. He argued how “postcard stories of grass-roots development projects for women, pivoted on micro-financing and loans, in reality push women into debt cycles that they can’t get out of.” In the end, he said, these programmes tend to “further disempower and dent women’s solidarity” and “teach women to be docile and adopt conformity”. He also pointed out that such projects acquire an existence of their own which needs to be sustained irrespective of whether they help their supposed beneficiaries or not. “The women do everything to help development projects but never rise out of poverty themselves,” Nizamani added.

The Islamabad offices of the Sustainable Development Policy Institute (SDPI) have a sleepy, comfortable, white-collar air about them. The organisation came about as an independent think tank established under the recommendation of the National Conservation Strategy (NCS) in the early 1990s. Visiting its almost silent premises in October, 2013, it was difficult to imagine that weeks later it would organise the latest edition of its grand annual event, known as the Sustainable Development Conference (SDC). Given the breadth of its topics – from environment to international trade, economy and politics to history – and the fact that it involved 161 panelists including eminent researchers, known civil society activists, environmentalists, bureaucrats and even politicians and ministers from not just Pakistan but from places as varied as Afghanistan, Bangladesh, Canada, Ecuador, Finland, Germany, India, Indonesia, Kenya, Nepal, Pakistan, Sri Lanka, the UK and the US, the SDC was a veritable organiser’s nightmare.

Abid Qaiyum Suleri, the SDPI’s executive director, perhaps personifies the organisation. As he answers queries about the work his organisation does, he also juggles a number of other tasks, such as scheduling or cancelling his appearance on news television channels. There is nothing hurried about his demeanour though he is extremely busy. A monthly calendar up on a wall in his office is chock-a-block with travel itineraries in at least three continents for seminars and conventions. Regardless of the apparent calm of the SDPI office, it is not difficult to imagine what its overbooked schedule of events can lead to. For one, it runs the risk of making seminars and conferences a desirable goal in themselves and thus taking the focus of the organisation away from its core function of being a think tank. P

eople at the SDPI vehemently argue that their core operations still revolve around filed research, data collection and analytical report writing, but without putting in place sufficient safeguards they may start going down the slippery slope of becoming a highly bureaucratised institution, with handsome salaries, deep pockets, calendars bustling with events but no substantial research to their credit. At many other NGOs in Pakistan this may have already happened. Biswajit Ghosh, an Indian researcher, in a 2012 paper on the topic of NGOisation, highlighted this problem when he wrote: “...the more an NGO becomes successful in expanding its activities, the more it gets alienated from the people and becomes hierarchical.”

When that happens, as Talpur points out, NGOs start hiring smart people who can keep the activities going and the donors happy without having to pay any attention to the people they aim to serve. “[They hire] staff that look polished and well-spoken and fluent in English in order to make it easy to liaise with the donors, rather than hiring individuals who the people requiring development can relate to.”

According to the Organisation for Economic Co-operation and Development, comprising industrialised countries, Pakistan has received a steady inflow of aid since 1970, peaking at three billion US dollars in 2010 alone. This was twice as much as what Bangladesh received the same year. A large part of this huge inflow of money is going to NGOs, or the third sector. The NGOs are clearly here to stay.

Decidedly, NGOs are the best option for responding to crises; they may also help set a national agenda on pressing social, economic, political and environmental concerns for the state as well as society. The question is how to make them more effective, transparent and accountable to the people they are supposed to work for.

The government’s initiatives to regulate the sector are rightly seen as attempts to restrict the activities of certain NGOs working in areas where the government does not want them to get involved. Even the proposed Foreign Contribution Bill 2014 may lead to more red-tapism and bureaucratic control of a sector which has so far existed outside of such restrictions. The bill also seems to focus exclusively on NGOs and the third sector as the recipients of foreign money which need regulation. As pointed out by Consumers Watch Pakistan, it leaves out contractors and private businesses which bid for projects from large-scale aid agencies and development institutions and manage large-scale, donor-provided funds in Pakistan. This smacks of selective application of regulation.

But, on the other hand, NGOs need to re-establish a sort of mediating, neutral ground between state and household/family, with long-term vision and far-sighted planning to identify and address the problems of citizens — not to replace the state but to make it more effective, transparent and accountable.

Let the Pakistani government not assure its citizens of a ‘roshan Pakistan’, largely with the help of American aid money, every night during prime-time television. Instead, the third sector ought to help create a society where people’s needs are addressed by an efficient government, indebted to no imperial power. To quote Saigol: “A state that delivers and is effective is the only answer. NGOs can never and should never replace a democratic, responsive and accountable state and political system.”


This was originally published in Herald's April 2014 issue. To read more subscribe to Herald in print.


The writer is a staffer at the Herald.