Surgical Strike on NGOs: Modi Government Tightens FCRA Rules to Curb Foreign Funding and Safeguard National Security

The Modi government has progressively tightened regulations surrounding foreign funding to Non-Governmental Organizations (NGOs) under the Foreign Contribution Regulation Act (FCRA), introducing new rules dubbed 'FCRA 2.0' to be implemented following the monsoon session.

Key Highlights of the New FCRA Rules:
- Decline in Active Licenses: Out of 52,159 organizations registered in 2012, only 14,455 currently hold active FCRA licenses, collectively receiving roughly Rs 22,000 crore annually.
- Reasons for Crackdown: Intelligence reports highlighted foreign-funded interference in major infrastructure projects (such as Kudankulam and Sterlite), the use of grants to set media narratives and fuel protests, unauthorized religious conversions, and attempts to tarnish India's global image.
- Key Regulatory Changes:
1. Asset Seizure: If an NGO's FCRA registration is cancelled or expires without renewal, properties built using foreign funds will be controlled by a designated authority and could be auctioned.
2. Sub-granting Ban: Transferring FCRA funds to other local NGOs or individuals is prohibited; transactions must go through a primary SBI account.
3. Administrative Cap: Administrative expenses funded by foreign grants are capped at 20% to ensure 80% goes directly to project work.
4. Mandatory Identification: Key officials, directors, and trustees must submit identity verification details (such as passport/OCI for foreigners).