What Is The FCRA?

The Foreign Contribution Regulation Act 2.0 (FCRA), a bill yet to be passed by the Parliament, was introduced in the Lok Sabha on 25th March by the Union Government. The Bill was presented as a step towards achieving greater transparency and tightening national security.
It seeks to more strictly regulate the civic work being done in the country, especially with regard to the foreign funding that Organisations and NGOs receive. It also introduces a framework which establishes a central authority for the management of all NGOs and Organisations, especially their licences and assets. It also seeks more accountability in terms of the foreign funds being received by them and the purpose for which they are being used. While the Government may claim that it brings more transparency to its work, it can also be construed as the Executive’s descent over the affairs of India’s voluntary sector, effectively narrowing the scope of civic work.
The FCRA was first enacted in India in 1976 during the Emergency amid growing concerns about foreign powers intruding in India’s affairs by transferring money into the country through independent organisations. However, it has increasingly been used to tighten control over the voluntary sector, with the 2026 amendment being the latest measure in this regard. According to the official website of the FCRA Bill by the Ministry of Home Affairs, 43.1% of the total registrations, i.e., 22,496 of the total 52,156, stand cancelled, with another 29.2% (15,218) ‘deemed ceased’. ^[i]

Sovereignty Vs Religious Control

A troubling term that you might come across repeatedly in the Act is the term ‘proselytisation’, which can be defined as trying to persuade someone to change their religious or political beliefs or way of living to your own. This is one of the ‘religious activities’ excluded from the list of permissible ones; to top it off, nowhere is the term defined, neither in the parent Act nor in the Amendments. As a result, we are left with an ambiguous, all-encompassing term whose meaning is up to the executive. This discourages any activity that could be deemed even slightly religious, thereby constricting the already limited and uncertain sphere of religious life in India. This makes the void-for-vagueness principle applicable, since much room has been left in the interpretation for executive discretion.
 Last year, on 25th December, the Ministry of Home Affairs refused to renew the FCRA registration of Mother Teresa’s Missionaries of Charity, citing “adverse inputs” which, again, does not give any plausible justification.

The cancellation of Missionaries of Charity’s FCRA registration, while a blow to the Christian community, also adversely affected thousands of impoverished persons hailing from all castes, creeds, and backgrounds who either work for the Organisation or are taken care of by it. Starting with a small beginning, the Organisation has now expanded to take on multiple concurrent projects; it has more than 175 homes for the destitute, the poor, and physically and mentally challenged adults abandoned by their families, 82 children’s homes, feeding centres, night shelters, educational programmes, etc.^[ii] All this social work took a hit once the license renewal was denied, and all this would again be at stake upon probable subsequent denials.

Surveillance Or Oversight?

The 2026 Amendment of the FCRA Bill has also faced much criticism from the Opposition, with many believing that it is a deliberate target on the voluntary sector. It has introduced many new rules which can be described as quite relentless.^[iii]
One of the rules, though already present in the 2010 Act, is a mandatory requirement for NGOs and Organisations to maintain a bank account with the State Bank of India in New Delhi, making it easier for the Government to closely monitor the finances of all NGOs and Organisations. One of the amendments in the Act is the banning of sub-granting of funds to smaller organisations under Section 7, reducing the capacity of smaller NGOs to work. NGOs in India received Rs 88,882 crore in total between 2017 and 2022. Such a huge amount, but reserved only for the bigger organisations; the ones at the grassroots levels are often dependent on the sub-grants of this foreign funding to carry out their work, and this ban would take a heavy toll on their financial situation and their ability to undertake projects or even continue the ongoing ones, forcing them to shut down along with any institutions that they might be running. It is highly likely that this ban might have a domino effect, affecting the smallest of organisations which run mainly on sub-grants. The most concerning of all, however, are the provisions for cancellation of FCRA registrations in Section 14-B, with next to no accountability as regards the process. The previous Section 15 has been replaced with Chapter III-A, which provides for automatic cessation of licences. An Organisation or NGO stands to lose its registration if it fails to apply for renewal on time, or if the renewal remains pending; the denial of renewal is an entirely different story. The Government has listed various grounds for cancellation of licences. Still, the one that stands out the most is “if considered necessary or expedient so to do in the public interest…” under Section 14-B(1) clause (b). This, once again, widens the scope for arbitrary executive action and allows for Institutions to be paralysed at the executive’s whim.^[iv]
Now comes Section 16(A), which allows the Government to seize all assets of an Organisation upon its registration’s cancellation, a rather draconian provision. It takes years for an Organisation or Institution to collect the necessary funds and accumulate the assets needed, and now they can be swept up with no explanation. The Government now reserves the right under Section 16-A(6) clauses (a) & (b) to manage, transfer, or dispose of these assets, with the unutilised sales proceeds going to the Consolidated Fund of India. Organisations risk losing their assets such as schools, hospitals, orphanages, charities, places of worship, etc,  over the minutest irregularities in their documents, owing to the wide discretion granted to the executive, enabling legal confiscation which may even end up being permanent.^[v]

Barricading Civic Work

According to the earlier FCRA rules, there were five permitted categories — social, economic, educational, cultural, and religious. Now, under the proposed new rules in a separate Gazette notification, there is an entire separate list of stipulated purposes or activities for Organisations to choose from, under the same categories, and only these activities are now permissible; also, a separate fee is now required to be paid for each category, and any sort of violation will result in a minimum fine of ₹1 lakh.^[vi]
Organisations are also supposed to specify their geographical limits, i.e., the States they will be working in, their websites, and their social media accounts.
There is ample difference between monitoring the finances of an organisation and monitoring its ideas and initiatives. As is, the Bill lacks any sort of transparency, and with Organisations being subjected to this type of surveillance, there is little room for them to work that would be approved by the Government.
This step would effectively shrink the room for civic work, reducing something that is supposed to be a place for people to work for themselves and improve their own conditions.

Conclusion

The Foreign Contribution (Amendment) Bill, 2026 was presented by the Union Government in the Lok Sabha on March 25. The Bill was offered as a step toward strengthening national security and increasing transparency. It aims to impose stricter regulations on the nation’s civic work, particularly with relation to the foreign funding that the Civil Organisations and NGOs receive, as it was believed that through funding to independent Organisations, other countries are able to interfere, and are interfering, in the internal affairs of India.
The FCRA Bill of India has always been one of its most stringent laws, and while each Amendment outdid the last, the 2026 Amendment has outdone them all. If passed, it would effectively narrow down the scope of all activities of the Voluntary Sector, leaving it checked on the executive chessboard, waiting for an arbitrary checkmate. 

^[i] FCRA Online, available at: https://fcraonline.gov.in/public-dashboard (last visited on July 26, 2026).

^[ii] Weaponising FCRA: Controversy surrounds govt refusal to renew licence of Missionaries of Charity, available at: https://frontline.thehindu.com/cover-story/weaponising-fcra-controversy-surrounds-govt-refusal-to-renew-licence-of-missionaries-of-charity/article38192422.ece (last visited on July 23, 2026).

^[iii] FCRA Bill: Reasonable curbs or tools of oppression?, available at: https://frontline.thehindu.com/the-nation/fcra-bill-controversy-minorities-ngos-federalism/article70846736.ece (last visited on July 26, 2026).

^[iv] FCRA Bill — expanding state control over civil society, available at: https://www.thehindu.com/opinion/lead/fcra-bill-expanding-state-control-over-civil-society/article71090084.ece (last visited on July 23, 2026).

^[v] The Foreign Contribution (Regulation) Amendment Bill, 2026.

^[vi] Ministry of Home Affairs, Notification dated 1st July for Compounding, available at: https://fcraonline.gov.in/ (last visited on July 23, 2026).