JPC members question Center for Foreign Funds, takeover provisions in FCRA amendments

The Ministry of Home Affairs (MHA) said in its submission that the proposed changes aim to make the use of foreign contributions more transparent and transparent. Photo credit: X/alka_gurjar

At the first meeting of the Joint Committee of Parliament on the Draft Foreign Contribution Amendment (Regulation) Bill 2026, members raised a number of questions about the proposed changes, with the main questions from ruling party MPs focusing on the use of foreign contributions and opposition MPs questioning the provisions relating to assets when an organization’s FCRA license is revoked.

The opposition raised objections to the provision of a “designated authority”, which will have wide-ranging powers. Under this provision, if an organization’s Foreign Contribution (Regulation) Act (FCRA) certificate is revoked, surrendered or automatically lapses, the foreign contributions and any assets generated from them will be vested in a government-appointed “designated authority” without a prior hearing or court order.

The Ministry of Home Affairs (MHA) said in its submission that the proposed changes aim to make the use of foreign contributions more transparent and transparent.

Ministry representatives also argued that the “designated authority” provision was not new in the law. Under the existing legislation, there is a provision for “prescribed authority” which, as per the notification dated November 5, 2018, is the Additional Chief Secretary or Chief Secretary (Home) of the concerned State or Union Territory.

Under current law, however, there is no time limit for such custody, so a “prescribed authority” cannot make “substantive decisions about the property” as a “passive guardian”. There is also no standard procedure for taking over such assets, maintaining inventory or separating foreign-contributed assets from domestically-funded assets, MHA said in its filing, according to sources.

Officials further argued that in extended guardianship cases, states may face budget and labor constraints in managing entrusted institutions such as schools, hospitals and orphanages. The existing law is also silent on the final disposal of property and treatment of places of worship, they said.

Several opposition members, according to sources, including DMK’s P. Wilson and Trinamool Congress’s Menak Guruswamy, argued that dispossession could not be allowed without a hearing under Article 300A of the Constitution.

The MHA presentation also came under fire for cataloging foreign contributions received by various religious groups and emphasizing that most of the funding went to Christian organizations.

Members questioned the ministry’s rationale for segregating contributions received under religious heads.

“National Security” legislation.

The FCRA was enacted in 1976 at the height of Cold War geopolitics, amid deep distrust of Western influence and heightened sensitivity to threats to Indian sovereignty and democratic institutions.

Prior to 1976, NGOs receiving foreign funding operated under general laws such as the Companies Registration Act, the Trusts Act and the Companies Act, without a centralized mechanism to track foreign contributions. Oversight was largely limited to tax compliance and foreign exchange markets, which did not address national security concerns.

Citing this background, the MHA said the latest amendment is at its core a “national security” piece of legislation.

Published – 18 Sep 2026 22:38 IST