Ambassador Kwatra Counters ‘Myths’ Over FCRA Bill

WASHINGTON, DC-India has pushed back against what it called “misunderstandings” surrounding its proposed FCRA amendment, saying the legislation aims to strengthen oversight of foreign funding without restricting lawful civil society activities.

India’s Ambassador to the United States, Vinay Mohan Kwatra, issued a detailed “Myth vs. Reality check” on August 9 on the proposed Foreign Contribution (Regulation) Amendment Bill, 2026, addressing concerns raised in sections of media and civil society.

“There are many misunderstandings in the media and in civil society about the proposed Foreign Contribution (Regulation) Amendment Bill (FCRA), 2026,” Kwatra said in a series of posts on X.

Rejecting claims that India was framing a new law to cut off foreign aid to civil society, the Indian Ambassador to the United States said regulation of foreign financial flows in public and political spaces was a sovereign measure driven by national security considerations and consistent with practices in other democracies.

“The fact is that the law does not forbid Indians from receiving foreign donations or shut down law abiding civil society,” Kwatra said. “Tens of thousands of associations are registered under FCRA and routinely receive foreign funds for health, education, disaster relief, research and humanitarian work.”

Tracing the evolution of the law, Kwatra said India enacted its first FCRA in 1976, which was replaced by a modern framework in 2010 and further strengthened through amendments in 2016, 2018 and 2020.

“The 2026 Bill and Rules are the next step in the same direction: more transparency, better governance, clearer rules,” he said.

Addressing concerns that the FCRA regime had adversely affected NGOs and charitable organizations, Kwatra said foreign contributions to registered entities had increased from about $1.2 billion in 2010-11 to $2.67 billion in 2024-25.

He noted that while India has over three million NGOs, only about 14,450 hold FCRA registration, indicating that the majority of civil society organizations fall outside the law’s ambit.

“FCRA does not stop anyone from accepting foreign charity, research grants or humanitarian aid,” Kwatra said. “It asks three things — register, receive the money through laid down process, report what you did with it.”

On concerns over possible seizure of assets, the Indian Ambassador to the United States said that under existing provisions since 2010, foreign contributions and assets created from them vest in a state government authority when an organization’s registration is cancelled or surrendered.

“What the 2026 Bill adds is a designated authority to safeguard those assets — and a way back,” Kwatra said. “If the organization restores its registration, all assets and unused funds are returned in full.”

He added that places of worship would have specific safeguards, with property linked to such institutions being transferred to another FCRA-registered association of the same faith to ensure continuity.

Rejecting allegations that the law targets any religion or community, Kwatra said, “Nothing could be farther from it. The Act applies uniformly to all organizations regardless of religion, community or ideology.”

Faith-based welfare activities, religious education and charitable work by organizations of all faiths would continue to remain eligible for foreign funding, he added.

Kwatra also dismissed the contention that India was an international outlier in regulating foreign funding, citing comparable laws such as the US Foreign Agents Registration Act of 1938 and the Foreign Account Tax Compliance Act of 2010, along with legislation in Australia, Canada and the United Kingdom.

The FCRA regulates the acceptance and use of foreign contributions by individuals, associations and companies in India, requiring registration or prior permission along with compliance with banking, accounting and reporting norms. (IANS)