Govt moves amended FCRA in Parliament; designated authority to take over, run assets

THe Centre on wed introduced a banknote in the Lok Sabha to amend the strange funding jurisprudence, proposing the conception of a “designated authority” empowered to take over, manage, and transfer or sell assets created from foreign funds when an organisation’s registration is cancelled, surrendered, or not renewed.The Foreign Contribution Regulation Amendment Bill, 2026, also proposes to reduce the maximum imprisonment for violations of foreign funding laws from five years to one year, and to fix timelines for the utilisation of foreign funds received under the prior permission category.Introducing the bill, Union minister of state for home affairs Nityanand Rai asserted that “the Modi government will not tolerate any misutilisation of foreign funding and will take strong action against such elements”.The existing Foreign Contribution Regulation Act (FCRA), 2010, regulates the acceptance and utilisation of foreign contributions and foreign hospitality to ensure that such inflows do not adversely affect national interest, public order or national security. The law came into force on May 1, 2011, and has been amended in 2016, 2018 and 2020. According to data from the ministry of home affairs (MHA), around 16,000 associations are currently registered under FCRA, collectively receiving approximately ₹22,000 crore annually.According to the statement of objects and reasons, the proposed legislation seeks to establish a “comprehensive statutory framework for vesting, supervision, management and disposal of foreign contribution and assets through a designated authority, including provisional and permanent vesting; to provide timelines for receipt and utilisation under prior permission; to provide for cessation of certificate; to regulate handling of assets during suspension; to rationalise penalties; and to require prior approval of the Central government for initiation of investigation”.Opposing the bill, Congress leader Manish Tewari said “the bill would give sweeping power to the executive without any constitutional safeguards.” Pratima Mondal of the Trinamool Congress said “the new bill was dangerous and draconian as the central government will have absolute power and ensure centralisation of authority”.Responding to the criticism, Rai said: “It is indeed dangerous but for those who indulge in forced religious conversion and those who abuse the foreign funding for personal gain”.Under the proposed law, the MHA has introduced a new Chapter IIIA to establish the designated authority, which will have powers to take provisional or permanent control of assets created from foreign funds in cases where FCRA certificates have been cancelled, surrendered or ceased.The authority will be responsible for the “supervision, management, safeguarding, preserving or maintaining” such assets. It will also be empowered to use permanently vested assets for public purposes, including the ability to “transfer assets to any ministry, department, authority or agency of the central government or of a state government or any local authority”, or to “dispose of such assets through sale”, with proceeds — along with any unutilised foreign funds — credited to the Consolidated Fund of India.As per the bill, individuals or organisations can challenge decisions of the designated authority only before a court.The proposed amendments also seek to reduce punishment for violations. Under Section 35 of the new bill, anyone who accepts, utilises, or assists any person, political party or organisation in accepting or using foreign contributions or securities in contravention of the law shall be “punished with imprisonment for a term which may extend to one year, or with fine, or with both.” Earlier, such violations attracted imprisonment of up to five years.The bill also aims to fix timelines for the receipt and utilisation of foreign funds under the prior permission category.