New Delhi: The government of India has amended the rules for receiving foreign funds, requiring NGOs to choose from a predefined list of purposes and areas of operation, allowing a range of faith-based activities while explicitly excluding proselytisation from several categories eligible for registration under the Foreign Contribution Regulation Act (FCRA).
In a gazette notification issued on June 22, the Union Home Ministry also said any association having foreign nationals, other than those of Indian origin, as its key functionaries will "ordinarily not be considered" for the grant of registration or prior permission to receive foreign funds under the Act.
The amended rules carve out an exception, allowing the central government to specify such cases or circumstances through an order in which foreign nationals may be permitted to be "key functionaries" of an association seeking registration or prior permission under the FCRA, the notification said.
The government has notified a number of amendments to the FCRA Rules, 2011, tightening accountability for how non-governmental organisations (NGOs) and associations in India receive and use foreign funds.
The amendments have broadened the definition of "key functionary in relation to a person other than an individual" to cover a wide range of roles, including company directors, partners in firms, trustees, the Karta of a Hindu Undivided Family, and any person who has control over the management of the association.
The government has introduced a new clause under which NGOs seeking registration to receive foreign funds will have to specify the exact purpose and the state or Union Territory of their operations.
"Every application for registration shall mention the purpose or purposes for which registration is sought, chosen only from such list of purposes as specified in the Schedule appended to these rules; and the states or Union territories in which the association proposes to undertake the activities," the notification said.
The details shall be specified in the certificate issued to the NGO, it said.
The applicants must now choose their activities from a "Schedule" provided in the rules, covering religious, cultural, economic, educational and social categories as eligible purposes.
Under religious purposes, various activities have been listed, ranging from the construction, renovation and maintenance of religious places to religious education and the promotion of devotional music, among others.
The rules specify that three purposes—religious education, documentation of faith traditions and preservation of indigenous beliefs—must be carried out "excluding proselytisation".
The condition has also been mentioned in "documentation, preservation, and revival of indigenous and tribal faith practices, rituals and systems of worship" and "conduct of religious education, moral instruction, satsangs, discourses, and meditation retreats".
The rules give one year to all associations registered before 2026 to disclose to the government the specific purposes and states they wish to retain in their registration.
The Union Government has also introduced a fee structure through the amended rules, under which an additional ₹300 will be charged for every extra state or purpose added to an application.
To prevent inactive NGOs from holding on to licences, the government has introduced a minimum spending requirement of ₹10 lakh in foreign contributions on their chosen activities over the previous two financial years.
For an NGO to renew its registration or avoid cancellation, it must have spent the required amount of foreign contribution on its chosen activities during the previous two years.
For NGOs receiving foreign funds for a specific purpose under "Prior Permission", the second or any subsequent instalment of funds will be released only after at least 75 per cent of the previous instalment has been utilised, the notification said.
The government will conduct a field inquiry to verify the utilisation, it said.
NGOs receiving foreign funds must now provide details of their social media accounts in their applications for registration or renewal under the FCRA.
If money comes through "intermediary remittance vehicles" or "Donor Advised Funds", the NGO must disclose the ultimate donor (the original source of the money) in its applications.
Annual returns must now include a "detailed activity report" alongside financial statements, the rules said.
NGOs will have to declare whether any books or articles have been published by them or their key functionaries, as they are prohibited from producing or broadcasting "news or current affairs".