BIDS Report: Small and Medium-Sized NGOs Struggle as Foreign Funding Dries Up

❐ Staff Reporter

Globally, foreign development assistance has fallen by 23 percent, along with a decline in the number of new project approvals, impacting small and medium-sized NGOs that rely on grants.

This information came up in a discussion by the research institute BIDS.

In this situation, BIDS is considering government funding and a joint service structure between the government and NGOs as possible alternatives.

State Minister for Planning Jonayed Abdur Rahim Saki said that work is underway to formulate a policy in this regard.

In January last year, the United States Agency for International Development (USAID) suspended all its activities and projects in Bangladesh, leaving NGOs working with the agency in crisis.

A BIDS research report says that global development assistance from rich countries fell by 23 percent last year. Along with this, the approval of new projects has also decreased. The number of new projects approved in the last five fiscal years has fallen from 2,061 to 1,654.

BIDS Director General AK Enamul Haque said, “The idea of ​​NGOs in Bangladesh did not come from outside; it was within the country’s culture. Earlier, the activities of NGOs were limited to the local level, but now they have expanded further.”

Small and medium-sized NGOs that do not have microfinance activities are at the greatest risk. According to BIDS research, the budgets of these organizations have been reduced by up to 40 percent.

Highlighting the role of NGOs in the economy, State Minister for Planning Jonayed Abdur Rahim Saki said, “Many government projects are implemented through NGOs; in many cases, working in this way has the potential to be cost-effective.”

The Finance Minister said that NGOs can play a role in developing the creative economy in addition to conventional developmental services. However, projects that are not profitable will not be taken up.

BIDS also recommended creating an open list of NGOs capable and qualified to deal with the crisis.