Govt tightens norms for foreign funding for NGOs, allows more freedom to individuals

Indians can receive now upto 10 Lakhs rupees from relatives abroad

The new amended FCRA Rules, now enables Indians to receive up to Rs 10 lakhs without informing the government. A provision where an organisation/individual receiving foreign funds had to declare such contributions every quarter on its official website has also been done away with.

Earlier, this limit was of Rs. One Lakh, which now stands enhanced to Rs. 10 Lakhs and similarly the time limit for reporting the government the same transaction too has been increased from “thirty days, to “three months”.

As per Rule 6, which ?deals with intimation of receiving foreign funds from relatives. It said earlier that “any person receiving foreign contribution in excess of one lakh rupees or equivalent thereto in a financial year from any of his relatives shall inform the Central government (details of funds) within 30 days from the receipt of such contribution”.

The amended rule now allows relatives to send??10 lakhs without informing the government. If the amount exceeds, the individuals will now have 3 months to inform the government against 30-days earlier.

Similarly, making changes in rule 9, which deals with the application of obtaining ‘registration’ or ‘prior permission’ under the FCRA to receive funds, the amended rules given individuals and organisations 45 days to inform the MHA about bank account (s) that are to be used for utilization of such funds. This time limit was 30-days earlier.

The Centre has also ‘omitted’ provision ‘b’ in rule 13, which dealt with declaring foreign funds including details of donors, amount received, and date of receipt etc every quarter on its website.

Now, anyone receiving foreign funds under the FCRA will have to follow the existing provision of placing the audited statement of accounts on receipts and utilisation of the foreign contribution, including income and expenditure statement, receipt and payment account and balance sheet for every financial year beginning on the first day of April, within nine months of the closure of the financial year, on its official website or on the website as specified by the Centre.

In case of change of bank account, name, address, aims or key members of the organisation (s) receiving foreign funds, the MHA has now allowed 45 days’ time to inform it, instead of previous 15-day deadline.

The MHA had made the FCRA rules stricter in November 2020, saying that organisations which may not be directly linked to a political party but engage in political action like bandhs, hartal (strike) or rasta rook (road blockades) will be considered of political nature if they participate in active politics or party politics. The organisations covered under this category include farmers’ organisations, students, workers’ organisations and caste-based organisations.

In the amended FCRA – the law was amended in Sept 2020 - the Govt barred public servants from receiving foreign funding and made Aadhar mandatory for every office-bearer of the NGOs. The new law also says that organizations receiving foreign funds won’t be able to use more than 20% of such funds for administrative purposes. This limit was 50% earlier.

The ministry informed the parliament in March this year it has refused to renew the FCRA of total 466 non-government organisations since 2020 for not fulfilling the eligibility criteria in accordance with the provisions of the law.

There were 100 refusals in 2020, 341 in 2021 and 25 till March this year, MHA said in parliament. A key rejection was that of Oxfam India’s application for renewal of its foreign-funding licence in Dec 2021, which is yet to be renewed.

As of now, there are 16,790 FCRA registered organisations in the country.