This law is made on the basis of the foreign contribution amendment bills, to regulate the acceptance and utilization of foreign contribution by any individuals or any organization for their personal benefits. Discussion is going to be made over whole concept of the foreign contribution regulation act and its amendment with key features and challenges 

Definition of the foreign contribution regulation act

The word foreign contribution defines the transfer, donation, or delivery of any product or services by any foreign source. The product or service could be anything that has some value in the Indian market. This act was made in 2010. However, the amendment bill was passed by the Lok Sabha on 20th September 2020. As per this act, the Indian government has the proper control over the acceptance and use of any foreign resources for any personal or organizational benefits. Additionally, it is also mentioned that all the foreign resources or activities that have detrimental factors on various national interests are strictly prohibited. This act has a positive influence on the control of various foreign donations taken by different associations, groups, and non-governmental organizations and also ensures that all the contributions made from the outside of the country have no influence to destroy internal security.

Relation between Foreign contribution and foreign source 

As per the definition of section 2(1) (C) of the FCRA, 1976, the foreign contribution defines the donation or transfer made by any foreign resources. However, all types of source transfers are not considered foreign contributions. Some of key foreign contributions are as follows:

  • Article not provided as a personal gift and has not the current market value of more than 1000 rupees.
  • Different currencies are irrespective of Indian or foreign.
  • Any kind of foreign security.

The resources from which the contribution is coming are called foreign resources. Indian individuals or organizations can accept a contribution from foreign resources through their FCRA accounts only. However, the non-resident Indians also contribute resources in India through their NRE and FCNR account.  

Portrayal of Key features of this act

This act comes with various benefits from different aspects. Therefore, it has plenty of valuable features. Some of the key features of this act are as follows,

  • As per this act, any kind of foreign resources cannot be transferred to any individuals or organizations if they are not registered themselves in the e-governance initiatives. Therefore, proper control on the foreign contribution can be made through it. 
  • It is also mentioned in this act that anyone can make a single foreign contribution on their FCRA account. Other than foreign contribution, no other funds cannot be accepted or deposited in the account. Additionally, the account must have to open in the State bank of India, New Delhi branch. 
  • This act also suggests the compulsory use of Aadhar cards in registration to ensure a high level of security in FCRA accounts.   
  • According to this act, for any individual to accept the foreign contribution, they must have a certificate of registration from the central government and they need to take appropriate permission from the central government before the acceptance of foreign contribution. 

Showcase of Challenges in FCRA

However, there are also some challenges associated with this act. Some of the key challenges associated with the FCRA are as follows:

  • Implementation of new regulations puts excess pressure and conditions on all types of NGOs, educational institutions to make strategic partnerships with foreign countries. Moreover, it creates difficulty in operations for the organizations that work in very remote areas.
  • Excessive control on the NGOs restricts them in several voluntary actions. 
  • This practice has also had a negative impact on Indian culture and ethics. Ancient Indian ethics framework Vasudhaiva Kutumbakam promotes global engagement freely. However, this act is completely against this. 
  • Different external activities performed by the organizations to accept the foreign contribution increases the additional cost. For example, an FCRA account must be opened in State bank of India’s New Delhi Branch. It increases the cost for all the NGOs to come to Delhi just to open a bank account.

Conclusion   

It can be concluded that the act has both positive and negative impact on the operations of different activities in India. The discussion on features along with the challenges mentioned in this discussion allows readers to understand the positive and negative impact of this act on the Indian individuals and authorities.