India counters 'myths' over FCRA Bill
Washington, Aug 10
India has pushed back against what it called "misunderstandings" surrounding its proposed FCRA amendment, saying the legislation would strengthen oversight of foreign funding without shutting down lawful civil society.
India's Ambassador to the United States, Vinay Mohan Kwatra, issued a detailed "Myth vs. Reality check" on Sunday on the proposed Foreign Contribution (Regulation) Amendment Bill, 2026.
"There are many misunderstandings in the media and in civil society about the proposed Foreign Contribution (Regulation) Amendment Bill(FCRA), 2026," Kwatra said in a series of posts on X.
Rejecting claims that India was framing a new law to cut off foreign aid to civil society, Kwatra said regulation of foreign financial flows in public and political spaces was a sovereign measure driven by national security concerns.
He said such regulation was an accepted feature of modern governance in democracies around the world.
"The fact is that the law does not forbid Indians from receiving foreign donations or shut down law abiding civil society," Kwatra said. "Tens of thousands of associations are registered under FCRA and routinely receive foreign funds for health, education, disaster relief, research and humanitarian work."
India enacted its first FCRA in 1976. It was replaced by a more modern framework in 2010 and strengthened through amendments in 2016, 2018 and 2020, the ambassador said.
"The 2026 Bill and Rules are the next step in the same direction: more transparency, better governance, clearer rules," he said.
Kwatra also rejected claims that the FCRA had adversely affected NGOs and charitable organisations and that the latest amendment would impose further restrictions on their operations.
He said foreign contributions received by registered organisations had risen from roughly $1.2 billion in 2010-11 to $2.67 billion in 2024-25.
India has more than three million NGOs, but only 14,450 hold FCRA registration, he said. The overwhelming majority of civil society organisations are therefore outside the law's ambit.
"FCRA does not stop anyone from accepting foreign charity, research grants or humanitarian aid," Kwatra said. "It asks three things - register, receive the money through laid down process, report what you did with it."
The ambassador also addressed concerns that the amendment would result in the seizure of assets belonging to NGOs, religious charities, places of worship, hospitals, schools and other organisations dependent on foreign donations.
When an organisation's registration is cancelled or surrendered, foreign contributions and assets created from them already vest in a state government authority, he said. That provision has been in force since 2010.
"What the 2026 Bill adds is a designated authority to safeguard those assets - and a way back," Kwatra said. "If the organisation restores its registration, all assets and unused funds are returned in full."
Places of worship would have separate protection. Property linked to a place of worship and created by an association whose registration had been cancelled would be transferred to another FCRA-registered association of the same faith to ensure continuity of worship, he said.
Kwatra rejected allegations that the law specifically targeted a religion or community.
"Nothing could be farther from it," he said. "The Act applies uniformly to all organisations regardless of religion, community or ideology."
Faith-based welfare activities, religious education, maintenance of places of worship and charitable work by organisations of every faith would remain eligible for foreign funding, he added.
The ambassador also rejected the contention that India was an international outlier. He cited the US Foreign Agents Registration Act of 1938 and the Foreign Account Tax Compliance Act of 2010, along with legislation adopted by Australia in 2018 and Canada in 2024. He said the UK's scheme took effect in July 2025, while the European Union was considering legislation.
The FCRA regulates the acceptance and use of foreign contributions by individuals, associations and companies in India. Organisations covered by the law must secure registration or prior permission and comply with prescribed banking, accounting and reporting requirements.
— IANS
Reader Comments
As an American following this story, I appreciate India's Ambassador Kwatra giving such a thorough response. The comparison to FARA and FATCA makes sense - every country needs oversight. The data showing $2.67 billion in foreign contributions last year speaks volumes. India isn't isolating itself; it's modernizing its governance.
I run a small NGO in Bangalore and I can tell you, the FCRA process isn't as scary as people make it out to be. We register, we report, we do our work - it's that simple. The ambassador is right; there are over 14,000 registered organisations receiving funds. The people crying foul are probably the ones who don't want to follow rules.
I'm a bit sceptical about all this. The ambassador says assets will be returned if organisations restore registration, but what happens in the interim? That seems like a lot of administrative burden on small charities trying to do good work. I'd like to see more details on the asset protection mechanism. Also, Westerners should be careful about projecting their own views onto India's sovereignty.
The way the ambassador has explained the "way back" for organisations is reassuring. If the assets are properly safeguarded and can be returned, that's actually a fair system. And the separate protection for places of worship shows India respects all religions. Good to see our diplomatic team handling this so professionally 👏
Interesting how Indians are so defensive about this. The US has FARA, yes, but that's about foreign agents, not NGOs doing humanitarian work. I'm not against India tightening its laws, but the comparison isn't perfect. Still, it's India
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.