Centre tightens foreign funding rules for NGOs

New Delhi: The Union government has amended the Foreign Contribution Regulation Rules, tightening conditions for non-profit organisations seeking overseas funding under the Foreign Contribution Regulation Act (FCRA).

Under the revised rules notified by the Ministry of Home Affairs, organisations applying for FCRA registration must select their objectives from a government-approved list and specify the states or Union Territories where they plan to operate. Existing FCRA-registered organisations have been given one year to provide the same details.

The approved categories include religious, educational, social and charitable activities. Foreign funding will be allowed for activities such as maintaining places of worship, religious education and inter-faith initiatives, but not for religious conversions.

The amendments also introduce a fee of Rs 300 for every additional state of operation. Organisations seeking foreign funds must show that they spent at least Rs 10 lakh in foreign contributions on approved activities during the previous two financial years.

The government has also tightened eligibility norms concerning foreign nationals. NGOs with foreign citizens, except persons of Indian origin, as key functionaries, will ordinarily not qualify for registration, although exceptions may be allowed. The definition of key functionaries has been expanded to include directors, trustees, firm partners and heads of Hindu Undivided Families.

The changes come amid continued tightening of FCRA regulations. Earlier this year, the Centre amended the law to allow government control over an NGO's foreign-funded assets if its registration lapses and is not restored. Government data shows that over 6,600 NGOs lost their FCRA licences between 2016-17 and 2021-22, while 13,520 registered organisations received Rs 55,741 crore in foreign contributions between 2019-20 and 2021-22.