A fugitive guru and self-anointed “godman” who is facing charges of abduction and rape in India has established his own island nation, reportedly off the coast of Ecuador.

Nithyananda, who built up a huge spiritual following in India, is on the run from the Gujarat police over multiple allegations that he abducted and confined children to collect donations for his ashram and that he raped one of his disciples.

While Nithyananda’s whereabouts are unknown, on Wednesday he announced he was establishing the sovereign “Republic of Kailaasa”, which would be the “world’s greatest and purest Hindu nation”.

The “cosmic country” will reportedly be established on a private island off the coast of Ecuador, purchased by some of his wealthy devotees. Applications are open for those who want to apply for citizenship and a passport, which allows for “free entry in all 11 dimensions and 14 lokas [the 14 worlds of Hinduism] including Kailaasa”.

Only practising Hindus are allowed to apply for citizenship. A donation needs to be made to Kailaasa in order to be put forward for citizenship and all passport applications will be personally approved by Nithyananda.

Kailaasa describes itself as “a nation without borders created by dispossessed Hindus from around the world who lost the right to practice Hinduism authentically in their own countries”.

According to Indian media, at least “three prominent personalities” from Ahmedabad, where Nithyananda’s main ashram is based, already plan to relocate to the island.

After publication of this article, Ecuador’s ambassador to the UK, Jaime Marchán Romero, wrote to the Guardian that it was “absolutely false that Nithyananda or any of his associates have or could ever have established in Ecuador a so-called ‘cosmic republic’ for their followers and supporters.” Ecuador is a sovereign and independent republic and not “nobody’s land” where any national or foreign adventurer can act outside the law, the letter said.

As the founder of the Nithyananda Dhyanapeetam Trust, the guru has set up over a dozen temples and ashrams across India. But he has attracted much derision over claims of his spiritual abilities, including being able to delay the sunrise for 40 minutes, being able to see through walls, curing 82 children of blindness by “opening their third eye” and getting cows to speak in Sanskrit and Tamil. In 2010 there was further controversy over the release of a sex tape featuring him and a female Tamil actor.

Despite being a fugitive from the law for more than a year, Nithyananda has continued to broadcast live to his followers on YouTube, and it was on the platform that he declared the establishment of his new nation. It followed an address last week during which he stated: “Some people against me, they are looking for me, but I am in the Himalayas, in Kailaasa.”

A website dedicated to Kailaasa recently appeared, declaring that the country will offer universal healthcare, free food distribution, free education and “revival of a temple-based lifestyle”.

The site says Kailaasa also has its own cabinet, and government departments of homeland security, commerce, treasury, housing, technology and “enlightened civilisation”. The country also has its own flag, constitution and Hindu Investment and Reserve Bank, where cryptocurrency will reportedly be accepted as part of a “Dharmic economy”.

Last month, Gujarat police raided Nithyananda’s ashram in Ahmedabad and arrested two managers. The raid followed the release of several children who had allegedly been kidnapped and locked up in the ashram. “They were verbally abused horribly, they were beaten,” read a police report on the case. Nithyananda had already faced charges of raping a female disciple for five years during her stay in the ashram, under the guise of helping her spiritually, but he failed to turn up to his trial last year.

In 2014, one of his followers died in mysterious circumstances in his ashram. Leaders at the ashram claimed she died from a heart attack, but the family said they suspected foul play.

• This article was amended on 10 December 2019 to add a response from Ecuador’s ambassador to the UK.