What is FCRA and why is it important?
Foreign Contribution (Regulation) Act, or FCRA, is an act in the Indian Constitution, the purpose of which is to regulate the acceptance and utilisation of foreign contribution or foreign hospitality1 by certain individuals or associations or companies and to prohibit acceptance and utilisation of foreign contribution or foreign hospitality for any activities detrimental to the national interest and for matters connected therewith or incidental thereto.
Simply put, FCRA regulates the inflow of foreign contributions or aid to India. The law is enforced by the Ministry of Home Affairs.
The intention behind this act is to prevent foreign organisations from dominating—or even influencing—social, political, economic, and religious discussions in India. Examples of such influence are: religious groups carrying out conversion programmes in India, or organisations funding Indian activists protesting against large dams or nuclear plants.
FCRA prohibits certain individuals and organisations from accepting any foreign contribution. These include political parties, government employees, print or visual media outlets, and so on. Companies that are allowed to receive foreign funds can only do so after obtaining a registration.
It is important to note here that foreign money that flows into the country as payment for goods or services to Indian businesses is outside the purview of FCRA.
All data quoted in the article has been derived from the report Estimating Philanthropic Capital in India, published by the Centre for Social Impact and Philanthropy (CSIP), Ashoka University.
Saahil Kejriwal contributed to this article.
