Govt notifies new rules for NGO
Published on
Nov-24-2020
Govt notifies new rules, makes it tougher for NGOs to get foreign funds- 13th Nov- Indian Express
(GS 2, Governance)
In News
· The centre has recently further tightened rules for organisations seeking foreign funding.
New Rules
· Eligibility
o The new rules state that any organisation seeking registration under the Foreign Contribution (Regulation) Act (FCRA) must have operated for at least 3 years.
o It must have spent minimum amount of Rs 15 lakh on its core activities for the benefit of society during the last 3 financial years.
· Prior Permission
o Any organisation seeking prior permission for receiving a “specific amount from a specific donor for carrying out specific activities or projects” shall “submit a specific commitment letter from the donor.
o The letter shall indicate the amount of foreign contribution and the purpose for which it is proposed to be given.
· Contributions Above 1 Crore
o The Centre has said that if the value of foreign contribution is over Rs 1 crore, it may be given in instalments.
o But, provided the second and subsequent instalment shall be released after submission of proof of utilisation.
o Proof of utilisation must show 75% of the foreign contribution received in the previous instalment.
o There will be field inquiry of the utilisation of foreign contribution.
· Political organisations
o The rules for declaring an organisation as a “political organisation” have been relaxed.
o Student, farmer, worker and youth organisations are being exempted unless they participate in “active politics or party politics”.
o Political organisations can’t receive foreign funds.
· Stringent Norms
o The amendments have made the FCRA, 2010 more stringent.
o It has prohibited transfer of funds from one NGO to another.
o It has decreased administrative expenses through foreign funds from 50% to 20 %.
o Aadhaar has been made mandatory for registration.
o This gives the government powers to stop utilisation of foreign funds through a “summary enquiry”.
Conclusion
- The new rules are a follow-up on the amendments to the FCRA that the Centre pushed through in the last session of Parliament.
- In the newly notified rules, the Centre has made an insertion in Rule 9.
- It deals with obtaining registration or prior permission to receive foreign funds
- It makes the process more cumbersome for NGOs.
