DC Edit | FCRA Bill: Govt Must Come Clean

The decision of the Union government not to take up for discussion in the Lok Sabha the Foreign Contribution Regulation (Amendment) Bill, 2026, in the Budget Session is a welcome step by half. It may have been prompted as much by the strong objections raised by the Opposition as the elections to the Assemblies in four states and a Union territory but the government may do well to address the genuine concerns expressed by those who will be impacted by the legislation.

“The statement on objects and reasons” of the bill suggests that the government noticed “certain operational and legal gaps” in relation to the management of foreign contribution and assets created in cases where registration is cancelled, surrendered or otherwise ceases, and it has sought to form a “designated authority” to take care of such assets. While it is understandable that an institution must hold a valid licence for accepting foreign contribution or for its running on such contribution, it defies logic that the government can take over the property even if the management has no role in the delay in the renewal of the licence. Worse, there is no judicial oversight for the entire process, which makes the very object of the bill suspect. The government may also verify if such a provision violates some of the fundamental rights guaranteed by the Constitution.

None will have a complaint in the government placing legal restrictions on foreign contribution to ensure the best and intended use of it, and take legal actions against violators. But casting a shadow of doubt on all those who run institutions dependant on foreign contributions and preparing a legal straitjacket for their functioning is hardly the way to regulate them. A number of such institutions are already facing the heat of overregulation; and the bill, in its present form, could choke the life breath out of them. The government must talk to stake-holders, make a clean breast of its intentions and return to Parliament with a piece of legislation that helps address its genuine concerns.