Foreign Contribution (Regulation) Amendment Bill 2020 (FCRA), passed in Lok Sabha, and Rajya Sabha, on September 21 and 23 respectively, with a view of increasing transparency in the working of an organization receiving foreign funds. The bill is receiving backslash from the NGOs and the Opposition with regards to the encroachment of NGOs financial administration.
What was the initial Act?
The decision of amendment comes with the Foreign Contribution (Regulation) Act (FCRA) of 2010, which has been amended twice. The Initial FCRA was enacted to regulate and prohibit the acceptance and utilization of foreign contribution such as transfer of any currency, security, or article for any activities detrimental to “national interest.” The Act applies to all associations, organizations, group which intend to obtain foreign donations. It also mandates the respective organization to register within FCRA for receiving donations on cultural, educational, economic, and religious goals. Political parties are not eligible for the same.
What changes with FCRA 2020 Amendment?
- The highlighting feature of the amendment is the reduction in utilization of foreign funds in the administration of the organization from 50 per cent to 20 per cent. The Government described the move as a step to ensure compliance and transparency with proper utilization of foreign funds.
- The Act prohibits the transfer of foreign contributions to any individual, association, or a registered company, causing an uproar from NGOs and Oppositions.
- Another key variation is the compulsory Aadhaar registration of all its office bearers, directors, or crucial functionaries for identification purposes, thus increase the existing burden of registrations.
- Every person who has been given a certificate of registration must renew the certification within six months of expiration. The Government may conduct an inquiry before renewal to ensure that the person making the application: (i) is not fictitious or benami, (ii) has not been prosecuted or convicted for creating communal tension or indulging in activities aimed at religious conversion, and (iii) has not been found guilty of diversion or misutilisation of funds, among others conditions.
- The Act empowers the Government to ask an organization to not use the funds by holding a “summary inquiry.” Earlier it was supposed to be done only after the person or association has been “found guilty” of violation of the Act.
- FCRA account has to be made with State Bank of India New Delhi, whereby the Government can monitor the flow of money.
- It also extends the period of suspension of registration of a person by the Government from the present limit of 180 days by up to an additional 180 days.
NGOs, Oppositions, and criticisms:
It is no doubt that the Civil Society plays a more prominent role in public welfare. Given the times of pandemic, the combination of Government and civil society helped to protect humanity. The restrictions levied by the Act may limit the existing NGOs will to serve the public. NGO as a sector already reports to several authorities, given its nature.
- The Act allows the Government to capture and scrutinize small details like change in a bank account or address.
- The reduction in use of foreign contribution for administrative purposes from 50 per cent to 20 per cent is unfavorable concerning the NGOs working for research and health. In times like COVID-19, the sector needs more relaxation than restrictions.
- The largescale NGOs are arguing onto the fact that they transfer funds to the smallscale based organization which doesn’t have any parent support of donations. Grassroots organizations with the help of Large NGOs funds facilitated the fight of social, economic, educational, environmental issues.
- The Opposition is looking onto the Act as a way for “Hindutva.” It is no mystery that the majority of foreign funds are received by Christian NGOs, a minority in India.
- The Opposition also calls out to Government on “PM fund cares” which is exempted from the Act, meaning, no question on the amount of the foreign funds received into the same.
- In 2019, Central Bureau Investigation raided the Amnesty International’s offices on account of FCRA violation. Notably, Amnesty was vocal against human rights violations in Jammu and Kashmir after the Government revoked special status under Article 370.
VANI the apex body for civil society organization, in a statement put forward why NGOs are opposing the FCRA bill 2020.
In 2015, an interesting statistic by the Central Bureau of Investigation (CBI) showed that there are 31 lakh NGOs in India, which is more than double the number of schools and 205 times more than the number of hospitals in the country. It stated that one NGO covers 400 people as against one policeman for 709 people.
The CBI also informed that only 8-10 per cent of these NGOs had filed their financial records with the Registrar of Societies (RoS) detailing receipt and spending of funds.
This alerted the Government, and in 2016 the Supreme Court directed to amend the FCRA Act, which led to the draconian steps by the Government.
The Government, in its stance, asserted that amendments aren’t against the NGOs but against the ones misusing the foreign funds with an attempt to hide their identity. The standpoint of maintaining and protecting internal security by examining the kinds of funds and their utilization within our sovereign body is also very crucial.
In a recent parliamentary debate, Minister of State for Home, Nityanand Rai quoted former finance minister P Chidambaram who had told Parliament earlier that “about Rs 20,000 crore funding was received by NGOs but nobody knew where did the Rs 10,000 crore out of it, go.”
The bill which is passed by the Parliament will now go for the President’s assent.
The fundamental of having two houses in our parliamentary system is to have an intensive discussion on a bill, formation, and adherence of public opinion. The current Parliament session has seen many controversial amendments which are being questioned by the public and opposition. Nation will have to wait and see how the implementation of these bills will take place and how Indians will actually be affected.