Explained: What is the FCRA Amendment Bill and why has it sparked a row?

A Bill that seeks to amend India's law governing foreign funding of non-governmental organisations (NGOs) has become one of the most contentious issues in Parliament this Monsoon Session. The Foreign Contribution (Regulation) Amendment Bill, 2026—first introduced in the Lok Sabha on March 25—was scheduled to be taken up for discussion on Wednesday. However, the government put it on hold on Tuesday after protests from opposition parties and certain civil society groups.

 

The Bill, which seeks to amend the Foreign Contribution (Regulation) Act (FCRA), has drawn sharp criticism from the Opposition, which has described it as "draconian". The controversy has also drawn international attention, with US Congressman Riley Moore alleging that the proposed amendments could allow the Indian government to take over churches and religious charities, warning that the move could affect India-US bilateral relations.

 

Here's a look at what the Bill proposes and why it has become so controversial.

 

What is FCRA?

 

The Foreign Contribution (Regulation) Act, 2010 regulates the acceptance and utilisation of foreign contributions in India. It applies to NGOs, trusts, societies, educational institutions, religious organisations and certain other entities that receive funding from foreign sources.

 

Under the law, any organisation seeking to receive foreign contributions must obtain registration, or prior permission, from the Ministry of Home Affairs (MHA).

 

An FCRA registration is valid for five years and must be renewed periodically. The law also prescribes how foreign funds can be received, utilised, accounted for and reported.

 

According to the Statement of Objects and Reasons attached to the Amendment Bill, India had 14,449 active FCRA registrations as of July 15, 2026.

 

Since the FCRA came into force, 22,498 registrations have been cancelled, while another 15,212 have expired. Between 2019 and 2022, organisations registered under the FCRA received foreign contributions worth Rs 55,741 crore.

 

What the FCRA Amendment Bill proposed to change

 

The Bill introduced in Parliament proposes significant changes to how foreign contributions are regulated in India.

 

The government has said the proposed amendments are intended to address gaps in the existing law, particularly in the management of assets created using foreign contributions when an organisation's FCRA registration expires, is surrendered or is cancelled. According to the Bill, the current legal framework does not provide a comprehensive mechanism for managing such assets, leaving thousands of crores worth of assets in prolonged legal uncertainty.

 

One of the biggest changes proposed is the creation of a government-appointed "designated authority". Under the proposed framework, the authority would take over the management of foreign contributions and assets created using foreign contributions when an organisation's FCRA registration is cancelled, surrendered, or lapses because it is not renewed.

 

The Bill also proposes reducing the maximum imprisonment for certain FCRA violations from five years to one year.

 

Additionally, it introduces a minimum utilisation threshold for the renewal of FCRA registration. Organisations that have received or utilised less than ₹10 lakh in foreign contributions during the previous two financial years may not be eligible to renew their registration.

 

Why has the proposed Bill sparked controversy?

 

Opposition parties, civil society groups and several Christian organisations have sharply criticised the Bill, arguing that the proposed amendments would significantly expand the government's powers over NGOs and institutions receiving foreign funding.

 

One of the biggest concerns is the provision to appoint a government-designated designated authority to manage foreign contributions and assets created using foreign funds after an organisation's FCRA registration is cancelled, surrendered or ceases. Those opposing the Bill argue that this gives the government sweeping powers over properties such as schools, hospitals, charitable institutions and places of worship built using foreign donations.

 

Opposition parties and civil society groups have also raised concerns over a provision that applies the new framework to assets that had already vested under the earlier law. They argue this could potentially bring organisations whose FCRA registrations had lapsed years ago under the new asset-vesting regime, even if they are now operating solely on domestic funds. The government, however, has not stated in the Bill that this is its intended effect.

 

Opposition leaders have also objected to the proposed requirement that state governments obtain the government's approval before initiating investigations under the FCRA. They argue that the provision weakens the powers of states and further centralises the enforcement of the law.