New Delhi: Two senior opposition leaders have asked Prime Minister Narendra Modi and Union Home Minister Amit Shah to withdraw the Foreign Contribution Amendment Rules, 2026, warning that the new framework would tighten state control over voluntary organisations and weaken independent civil society.
Congress general secretary K C Venugopal, who also chairs the Public Accounts Committee, wrote to the Prime Minister, while CPI Rajya Sabha member John Brittas wrote separately to the Home Minister, raising objections to the rules notified on June 22. Both leaders argued that the amendments go beyond financial regulation and risk converting non-governmental organisations, charities, minority institutions and faith-based service bodies into entities operating under fear of administrative action.
Venugopal described the changes as a “systemic assault” on civil society and said the rules could become the “last nail in the coffin” for independent non-profit activity. Brittas said the regulation of foreign contributions was a legitimate sovereign function, but cautioned that it should not be used to constrict organisations engaged in education, charity, social welfare and community work.
The amended rules require organisations receiving foreign contribution to specify the purposes for which they seek registration and identify the states or Union territories in which they intend to operate. Existing FCRA-registered associations must, within one year, submit details of the purposes and territories for which they want to retain registration. The prescribed list of activities is divided into religious, cultural, economic, educational and social categories.
The rules also provide for additional applications when an organisation seeks to add or remove an approved purpose or expand its operational area. A separate fee is payable for each additional state or Union territory and each additional purpose. Opposition leaders say this will restrict flexibility, particularly for organisations responding to disasters, public health emergencies, livelihood shocks or local community needs that may not fit neatly within pre-approved categories.
A major point of criticism is the change in reporting obligations. The amended framework requires more detailed activity reporting, along with information on websites, social media accounts and publications. Critics argue that these disclosures could enable intrusive scrutiny of advocacy, outreach and communication, while the government’s position has been that tighter disclosure improves transparency and traceability in the use of foreign funds.
The notification also broadens the emphasis on “key functionaries”, covering persons who control or are responsible for the management and affairs of an organisation. The rules state that an association with foreign citizens as key functionaries, apart from persons of Indian origin, will generally not be considered eligible for registration or prior permission, unless the central government specifies circumstances in which such cases may be considered.
Another provision links release of a second or subsequent instalment of foreign contribution under prior permission to the utilisation of 75% of the previous instalment and field verification of that utilisation. Organisations will also have to show activity in their selected field, with the rules indicating that the use of at least ₹10 lakh in foreign contribution over the previous two financial years may be treated as evidence of proper activity for cancellation and renewal purposes.
The amendments come against the backdrop of the Foreign Contribution Amendment Bill, 2026, introduced in the Lok Sabha on March 25. That Bill seeks to create a “Designated Authority” to manage foreign contributions and assets created from them when an organisation’s registration is cancelled, surrendered, deemed to have ceased, or not renewed. It also covers assets created partly from foreign contribution.
Opposition members had objected to the Bill in Parliament, arguing that it would give excessive power to the executive and affect civil society organisations. The government has maintained that stronger oversight is necessary to prevent misuse of foreign funds, including for activities contrary to national interest, public order or security.
The 2026 rules have intensified that dispute by bringing several operational changes through subordinate legislation. Venugopal said the government was seeking to impose controls through executive action after facing parliamentary resistance. Brittas said the amendments marked a shift from regulating money flows to regulating voluntary organisations themselves.
The FCRA regime has already become one of the most closely watched compliance frameworks for the non-profit sector. Since the 2020 amendments, organisations have had to receive foreign contribution only through a designated account at the State Bank of India’s New Delhi Main Branch, while administrative expenditure has been capped at 20% of foreign contribution. Transfers of foreign contribution between registered organisations were also barred, affecting networks that previously supported smaller field-level groups.
