Foreign Contribution Regulation (Amendment) Bill 2020 Introduced in Lok Sabha

Foreign Contribution Regulation (Amendment) Bill 2020 introduced in Lok Sabha to amend the FCRA act, 2010.

Key Provisions of the Bill

  • The bill proposes to include those public corporations owned and controlled by the Government of India under the list of entities that are not eligible to receive foreign funding.
  • It proposes to include public servants under the list.
  • The bill  makes Aadhar mandatory for all the non-government organisations and other organisations that seeks foreign contributions.
  •  It also proposes to limit the foreign funds received under the act from 50% to 20%.
  • Government would now be empowered to question a violator using the funds received from a foreign organisation.
  • As per the new provisions, Persons who have been granted certificate for the foreign funding will receive funding only through accounts that are designated as FCRA account.

Aim of the Bill

  • The bill is aimed at amending the provisions of the FCRA act to streamline the funding procedure.
  • The bill aims to increase transparency and accountability.
  • It also aims to strengthen the compliance mechanism in the utilisation of foreign contribution.

Background

The annual inflow of foreign funds has doubled between 2010 and 2019. But, the contributions received in this route were not being utilised by the recipient registered under FCRA. Thus, to regulate these foreign contributions under the act amendments has been proposed.

Conditions under the Act to use funds

The act imposed following conditions to use the foreign funds:

  • The funds received by a Non governmental organisation from foreign contributor must be used for the purpose the funds have been received for.
  • The funds should not be used in speculative activities.
  • The funds should not be transferred to an entity that has not been registered under the act.