NGOs vs. GoI: The Conflicts and Scrutinies

MHA extends FCRA Registration of NGOs


From UPSC perspective, the following things are important :

Prelims level: Foreign Contribution Regulation Act (FCRA)

Mains level: NA

Why in the news?

The Ministry of Home Affairs extended till June 30 the validity of all FCRA registered NGOs whose licences are expiring on March 31.

What is Foreign Contribution Regulation Act (FCRA)?

  • The FCRA regulates foreign donations and ensures that such contributions do not adversely affect internal security.
  • First enacted in 1976, it was amended in 2010 when a slew of new measures was adopted to regulate foreign donations.
  • The FCRA is applicable to all associations, groups and NGOs which intend to receive foreign donations.
  • It is mandatory for all such NGOs to register themselves under the FCRA.
  • The registration is initially valid for 5 years and it can be renewed subsequently if they comply with all norms.

What contributes to Foreign Donations?

  • Foreign Contribution’ means the donation, delivery or transfer made by any foreign source of any:
  1. Article (whose market value is not more than one lakh rupees);
  2. Currency (whether Indian or foreign);
  3. Securities
  • Foreign donations may be those from Governments, international agencies, foreign companies, trusts, corporations, foreign citizens
  • However, some agencies like the UN, World Bank, IMF etc. are EXEMPTED from the definition of foreign donors.

Who cannot accept donations under FCRA?

According to the FCRA, foreign donations cannot be accepted by:

  1. Election candidates
  2. Editors and publishers of newspapers
  3. Judges and government employees.
  4. Political parties and members of legislature etc.

What was the recent Amendment?

The FCRA was amended in September 2020 to introduce some new restrictions:

  • There is now a capping of the administrative expenses of NGOs at 20% of their foreign donations.
  • The new amendment requires them to have a State Bank of India account at a Delhi Branch.
  • It also prohibits the transfer of grants received under FCRA to any other outfit.
  • It also gives sweeping powers to the Ministry of Home Affairs to cancel the FCRA certificate of an NGO.
  • It made legal for political parties to accept foreign aid through Indian subsidiaries.
  • Under the Act, the government may suspend the registration of a person for a period not exceeding 180 days.
  • Providing Aadhar is mandatory for all office bearers, directors or key functionaries of the organization.



2015: Examine critically the recent changes in the rule governing foreign funding of NGOs under the Foreign Contribution (Regulation) Act (FCRA), 1976.


2015: How can be the role of NGOs be strengthened in India for development works relating to protection of the Environment? Discuss throwing light on the major constraints.


Practice MCQ:

Consider the following statements regarding “Foreign Contribution (regulation) Act”:

1.    World Bank is excluded from the definition of foreign sources under the act.

2.    Political parties are prohibited from taking foreign donations under the act.

Which of the statements given above is/are correct?

(a) Only 1

(b) Only 2

(c) Both 1 and 2

(d) Neither 1 nor 2

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