Foreign Contribution Regulation Act 2010

Aim

• Bringing more transparency in the funding of NGOs.

• FCRA was first enacted in 1976 and later amended in 2010.
• All NGOs seeking foreign funding have to register themselves under the FCRA with (Ministry of Home Affairs) MHA.
• Registered NGOs can receive foreign Contribution for social, educational, religious, economic and cultural purposes.
• Initial registration is valid for five years and it can be renewed NGOs comply with all norms.
• All registered NGOs must file annual returns, on the lines of Income Tax.
• Since 2015, NGOs are required to give an undertaking that the acceptance of foreign funds is not likely to prejudicially affect the sovereignty and integrity of India or impact friendly relations with any foreign state and doesn't disrupt communal harmony.

New Changes Introduced

• Introduced changes to the FCRA Rules,2010
• Inserted two clauses:Details of movable assets created out of FCRA,Details of immovable assets created out of FCRA,
• Annually declare details of movable and immovable assets under FCRA.

Earlier Amendments to FCRA

1. In 2020: Foreign Contributions received by an organisation cannot be transferred to any other person or organisation and is also registered to accept foreign Contributions.
2. Reduced the use of foreign funds to meet administrative costs by NGOs to 20% from the existing 50%.
3. In 2022: Allowing Indians to receive up to Rs 10 lakh in a year from relatives staying abroad.
4. Earlier limit: Rs 1 lakh
5. Individuals will now have 90 days to inform the Government instead of 30 days earlier.

Who cannot receive foreign donations?

1. Members of legislature and political parties, government officials, judges and media persons are prohibited ?? from receiving any foreign contribution.
2. In 2017 the MHA, through the finance bill route, amended the 1976 repealed FCRA law paving the way for political parties to receive funds from the Indian subsidiary of a foreign company or a foreign company in which an Indian holds 50% or more shares.

When is a registration suspended or cancelled?

• If MHA receives any adverse input against the functioning of an association, it inspects and can suspend the FCRA registration initially for 180 days.
• Till the final decision, the association cannot receive any fresh donation and cannot utilise more than 25% of the amount available in the designated bank account without permission of the MHA.
• MHA can cancel the registration of an organisation which will not be eligible for registration or grant of "prior permission" for three years from the date of cancellation.

Status of NGOs in India

• Minister of State for Home: NGOs have received Rs 16,306.04 crore in 2019-20.
• Received Rs 17,058.64 crore in 2020-21, and
• Received Rs 22,085.10 crore in 2021-22.
• NGOs in Delhi received the highest funding, followed by Tamil Nadu and Karnataka.
• Official data, there are 16,301 NGOs in the country.