New FCRA Rules: NGOs Must Choose Specific Purposes, Bar Foreign Key Functionaries

The Union Home Ministry has amended the Foreign Contribution Regulation Act (FCRA) rules, 2011, introducing stricter requirements for non-governmental organisations (NGOs) receiving foreign funds. The amendments, notified in the Gazette of India on Monday (June 22, 2026), mandate that NGOs choose their activities from a predefined list of purposes and specify their states or Union Territories of operation. The rules also bar foreign nationals, other than those of Indian origin, from serving as key functionaries of such organisations, unless the central government grants an exception by order.

The revised rules broaden the definition of 'key functionary' to include directors of companies, partners in firms, trustees, the Karta of a Hindu Undivided Family, and any person with control over the management of the association. This change aims to enhance accountability for how foreign contributions are received and utilised.

Under the new provisions, applications for registration under FCRA must select purposes from a schedule appended to the rules. The schedule lists religious, cultural, economic, educational, and social categories. For religious purposes, activities such as construction and maintenance of religious places, religious education, and promotion of devotional music are included. However, three specific purposes — religious education, documentation of faith traditions, and preservation of indigenous beliefs — must be carried out 'excluding proselytisation'. Similar exclusions apply to the preservation of indigenous and tribal faith practices and conduct of religious instruction.

The government has introduced a fee structure, charging an additional Rs 300 for each extra state or purpose beyond the first. Additionally, to prevent inactive NGOs from holding licences, the rules impose a minimum spending requirement: an NGO must have utilised at least Rs 10 lakh of foreign contribution on its chosen activities over the last two financial years to renew its registration or avoid cancellation.

For NGOs receiving funds under 'prior permission', subsequent instalments will be released only after 75 per cent of the previous instalment has been utilised, subject to a field inquiry by the government to verify expenditure.

All associations registered before 2026 have one year to disclose to the government their specific purposes and states of operation. The notification also states that any association with foreign nationals as key functionaries will 'ordinarily not be considered' for registration or prior permission, with the central government having the power to specify exceptions.