INTRODUCTION: NEED FOR STATE–NGO SYNERGY

Along with such internationally well-known environmental movements as the Chipko Movement and Narmada Bachao Andolan (Save Narmada Movement), the estimated tens of thousands of non-governmental organizations (NGOs) in India give that country an important place in the NGO movement worldwide.

If one looks at India's long tradition of voluntarism — a tradition rooted in religious activities and the independence movement — the number of organizations, and the great variety of their activities, one would seem to find here the existence of an ideal coexistence between voluntary and nongovernmental organizations (henceforth VO/NGOs) and the government. However the wide-ranging legal and administrative regulations that will be discussed below indicate that the government regards the NGOs as docile intermediaries or subsidiaries for its own policies and that these regulations are putting many restrictions on NGO activities. Particularly strict regulatory measures are taken in India with respect to the overseas funding that provides an important funding source for VO/NGO activities.

These regulations tend to limit VO/NGO activities to basically intermediary functions, and in this controlled environment many VO/NGOs in India indeed seem to find their raison d'être in intermediary functions. Of course this is not to say that, as long as grass-roots public administration does not function and poverty-alleviation programmes are not effectively carried out for the targeted social stratum, this kind of intermediary function is insignificant or irrelevant.

However, the perspective of VO/NGO activity is not confined to an intermediary function posited on the existing market and governance systems. In fact, a function of institutional reform, that is, vigilance, criticism, and reform of the market and governance systems, is an indispensable element of VO/NGO activity, particularly that based on voluntarism. Indeed, it can be further argued that there is a complementary relationship between these two functions whereby it is necessary to ensure the VO/NGOs' institutional reform function in order to perfectly realize their intermediary function.