Answer: International funding is imperative in a developing nation’s developmental aspirations due to lack of economic resources. However, lately these international fundings have come under scanner due to various ethical issues involved in their ultimate objectives like dollar imperialism or China’s debt trap/cheque book diplomacy.

Ethical Issues involved in International Funding

• Inequality and Exploitation: Due to inequality between developed and developing nations, international funding often results in exploitation. This is mainly done by conditional lending and often results in compromised sovereignty of developing nations.
• For instance, Sri Lanka under Chinese cheque book diplomacy had to give away the rights of territorial integrity of Hambantota port.
• Conditional Funding: The donors shape the policy framework and strategies through impositions, seriously undermining the rights, choices, and decisions of the people to determine their demands and actions needed for their development.
• Impacting National Security: International funding in many countries is aimed at impacting national security of other countries.
• For instance, Pakistan’s ISI has been actively supporting radical organizations to create social disharmony, radicalize local youths, and hire them for terror activities.
• Lack of Accountability: A main ethical issue in international funding is the lack of accountability mechanism.
• For instance, a country receives foreign aid due to a natural disaster. However, the donor doesn’t know how the government of the affected country will use the money due to lack of accountability mechanism.
• Funding to NGOs: Local NGOs receiving money for humanitarian work are often blamed for targeting the government’s policies and serving their donor’s interests.
• For instance, NIA has alleged Jammu and Kashmir Coalition of Civil Societies (JKCCS) for funding terror activities in the valley under the disguise of citizen’s empowerment.
• The proliferation of Monoculturalism: These aid programmes are often aimed at inculcating certain forms of culture and have low regard for indigenous culture in the targeted nations.
• Dependency on foreign aid: The receiving state starts to lose its independence and relies on foreign aid for socio-economic policies.

Ethical Framework to Make Funding more Sustainable:

• Maintaining Transparency and Accountability: Transparency and accountability are critical in international funding to maintain public trust and ensure that their work is effective and ethical.
• For instance, countries (receiving funds) can achieve transparency and accountability by implementing strong governance structures, including regular audits and reporting, stakeholder engagement, and open communication with their beneficiaries and partners.
• Ethical Partnerships: International fundings must be governed by ethical partnerships.
• For instance, a country more conscious about climate change must fund countries/bodies sharing the same concern.
• Need based Approach: To avoid excessive funding, NGOs must limit themselves to some core functions like creating awareness about government policies, capacity building of citizens etc.
• Need for international law: There is a need to ensure an international framework devised by international organizations and Governments to ensure an ethical approach is taken to give and receive funds internationally.
• Abiding by Local Laws: International funding must comply with local laws and regulations and maintain ethical standards in their operations and decision-making processes.
• For instance, NGOs operating in India and are receiving foreign fundings must comply with Enforcement Directorate norms.

Ethical considerations are fundamental to the functioning of international funding operations. Though the pursuit of aiding developing countries in their development is noble, international funding operations cannot be devoid of ethics.