Sometimes I wonder if Nepal is facing an NGO bubble that will burst someday. I found some revealing data on NGOs from a myRepublica article and Country Profile data from World Bank and you can decide for yourself where we need to focus on to make Nepal more developed.

It was reported on myRepublica on November 20, 2011 that Nepal had 50,000 NGOs and growing. That means, 180 NGOs in a week and 720 in a month go for affiliation! Interestingly, almost all of them are new NGOs, according to officials at the council. The registration process takes two to three days then the NGOs get their certificates (myRepublica). As for a startup, World Bank reports that it takes 31 days in Nepal to get a business started.

Given the population of the country, 34,000 NGOs means one NGO per 872 people! (myRepublica). To start a business, World Bank reports that in Nepal while there is no minimum capital requirement, the cost of starting a business is relatively high at $212 or 78.5% of income per capita. The licenses take about 15 procedures, 424 days and $875, or 324% of income per capita.

According to Prahlad Pant, the Assistant Director at the Social Welfare Council (SWC), most of the NGOs work for community development, which means maximum coverage of the social sector. Asked whether it was time to check the numbers of NGOs and focus more on quality, Uma Paudyal the Acting Deputy Director of the SWC said that "rising numbers alone need not be a problem, because NGOs bring more or less positive changes in society (myRepublica). In terms of businesses, World Bank data shows that we are very close to the bottom in employing workers and trading across borders.

Taking the above data into account, you can see why NGOs have taken flight in Nepal. NGOs play an important role in society from helping people to promoting a cause and can indeed make a difference in a society. However, I believe it is crucial to look into the quality of work the NGOs are doing by analyzing if their programs are effective in making an impact in communities.

Some concerns that I have with NGOs are as follows. Amongst the 50,000 NGOs, if the considerable amount of those focus on education, then they will be competing for the same resources (manpower, capital). Some sectors will receive a lot of attention while other sectors might not receive any attention at all. The SWC should really take this into consideration and give certificates to NGOs that have an action plan, measurable goals, effective strategies and most importantly a need in society.

Furthermore, the impact of an education focused NGO will be smaller when other NGOs also focus on education in the same area. If a new NGO could focus on another region or on issues that are not currently addressed, then it will have a better chance of making a difference in society. If similar types of NGOs work together, they can combine skills, resources and save on office space and other overhead costs. We want NGOs to be efficient and effective, not compete against each other.

The SWC should also look at how much NGOs help the economy. NGOs operate mostly through grants and rely on the continuous generosity of the donor organization/individual to keep it operating. NGOs that provide job training or skills development can help individuals tremendously in the long run. As the saying goes, Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.

I believe there should be a healthy balance of NGOs and Startups in a country. The rising number of NGOs is indeed a problem if the quality of their work is not addressed or maintained. The government should also take the insights from World Bank and create a suitable environment for startups to grow and function properly in the country.


http://www.parakhi.com/blogs/2012/01/15/ngos-vs-startups