Introducing the bill, Rai said, “There would be no discrimination. The permission which was given earlier to religious institutions for foreign contributions under the Foreign Contribution (Regulation) Act, 2010 will continue. But these institutions should not deviate from their objective and not be a threat to the country’s security.” The draft bill proposes that not more than 20 per cent of the total foreign funds received could be spent on administrative expenses. Presently, the limit is 50 per cent. Manish Tewari of the Congress objected to the bill and made a request to the government to relax the provisions of the FCRA.

Restrictions have also been put on NGOs under the proposed amendment on how they can utilise the foreign funding. The proposed amendment to the Act says NGOs cannot use more than 20 per cent of their foreign contributions towards meeting administrative expenses. Currently, the limit is 50% for paying salaries or meeting other administrative needs.

The amendments, if passed, will also prevent transfer of foreign contribution from one association or person to another. The amended bill allows NGOs to receive foreign donation exclusively in a designated FCRA account to be opened in the State Bank of India at New Delhi or ‘as the Centre shall specify by notification’. However, the entities may also open one or more accounts in other banks for keeping or utilising the foreign contribution received from the FCRA account in SBI, New Delhi, the draft says.

The statement of objects and reasons of the Bill says there is need to streamline the provisions of FCRA by strengthening the compliance mechanism, enhancing transparency and accountability in the receipt and utilisation of foreign contribution worth thousands of crores of rupees every year and facilitating genuine NGOs or associations who are working for the welfare of the society.