Parliamentary review and opposition
The bill was introduced in Lok Sabha on March 25, 2026. According to the ICNL Civic Freedom Monitor, both Houses of Parliament approved its referral to a Joint Parliamentary Committee on August 12. The 31-member panel, chaired by Lok Sabha member Sanjay Jaiswal, was formally constituted on September 3 and is expected to submit its report during the 2026 Winter Session.
Opposition MPs have argued that the proposal threatens due process, institutional independence and legitimate nongovernmental organizations. They have called for its withdrawal or substantial changes.
In an article in Daily Excelsior, Yatin Mahajan disputes that the bill targets legitimate NGOs. He argues that its focus is on organizations that lack a valid Foreign Contribution (Regulation) Act registration certificate or the required central government permission to accept foreign contributions.
How control of foreign-funded assets would work
The Foreign Contribution (Regulation) Act, 2010, known as the FCRA, provides for registration certificates that require renewal every five years. An organization without registration must obtain central government permission to receive foreign contributions from a specified source for a specified purpose. The bill would also require contributions accepted through this permission route to be received and used within a prescribed period.
The proposed Designated Authority would manage foreign contributions and associated assets after an organization's registration is canceled, surrendered or ceases, including when it is not renewed before expiration. The provisions cover assets financed wholly or partly through foreign contributions.
Control would initially be provisional while registration is renewed, restored or granted afresh. If that happens, the authority would return the unused contributions or assets. Otherwise, the assets would vest permanently in the authority.
Permanently vested assets would have to serve public purposes. The authority could transfer them to central or state government bodies, sell them or use another disposal process. Sale proceeds and unused foreign contributions would be paid into the Consolidated Fund of India. For assets that include a place of worship, the authority would have to arrange management under prescribed rules while preserving its religious character.
Limits, appeals and the existing asset framework
In a July 22, 2026 clarification, the Ministry of Home Affairs said the proposed authority would manage only assets created with foreign contributions, and only after an organization's registration had lawfully ceased. Each order would be subject to revision within 90 days, followed by a further right of judicial appeal to the district judge.
The ministry also says the bill would lower the maximum prison term from five years to one year. State agencies would need central government approval before opening FCRA investigations.
According to the ministry, vesting foreign-funded assets after cancellation is not a new concept: it dates to Section 15 of the original 2010 act. Over the past decade, nearly 22,000 registrations were canceled and about 15,000 were deemed to have ceased, involving contributions and assets worth thousands of crores of rupees. The ministry says the limited Section 15 framework left state authorities struggling to take possession of those assets and maintain or manage them.
Earlier restrictions and new reporting requirements
The ministry identifies the 2020 FCRA amendment as an earlier tightening of the system. It required Aadhaar or passport identification for officeholders, restricted receipt of foreign contributions to a single State Bank of India account in New Delhi and barred sub-granting. It also reduced the administrative-expense limit from 50% to 20% and extended the suspension period.
Separate revised rules, notified on June 22, 2026, require registration certificates to specify purposes and states or union territories of operation from a prescribed schedule. NGOs seeking renewal must demonstrate that they used at least Rs 10 lakh in foreign contributions during the preceding two years. Annual disclosures must also identify projects, activities and ultimate donors.
GKToday reports that active FCRA-registered NGOs declined from 29,022 in 2015 to 14,466 as of September 18, 2026. Foreign contributions, measured over different reporting periods, increased from Rs 17,832 crore in 2015-16 to Rs 22,974 crore in 2024-25.
The same report puts the government's cumulative registration cancellations at 21,983 NGOs. As of September 18, 2026, failure to file annual returns accounted for 91.3% of those cancellations.
The government's security rationale
Mahajan's Daily Excelsior article frames the diversion of foreign funding as a threat to India's sovereignty, integrity and internal security. He describes money being redirected toward political mobilization, protests against industrial, mining and energy projects, and extremist networks. He also cites investigations into the now-banned Popular Front of India that revealed a Rs 262 crore cross-border network involving Gulf-based committee and shell entities.
The government maintains that stricter FCRA enforcement is consistent with Financial Action Task Force recommendations. Its stated objectives include blocking illicit financial channels, terrorist financing and foreign-backed interference conducted under the cover of charitable or civil society work.
The Ministry of Home Affairs also cites foreign-influence transparency laws elsewhere: the United States' Foreign Agents Registration Act, in force since 1938; Australia's Foreign Influence Transparency Scheme, enacted in 2018; Canada's Foreign Influence Transparency and Accountability Act, enacted in 2024; and the United Kingdom's Foreign Influence Registration Scheme under the National Security Act 2023, which took effect in July 2025.
