Cedric Lobo –
The proposed Foreign Contribution (Regulation) Amendment Bill, 2026, along with the Foreign Contribution (Regulation) Amendment Rules, 2026, was reportedly expected to be taken up for discussion and passage before the conclusion of the Monsoon Session.
However, the proposed legislation is now expected to face scrutiny by a Joint Parliamentary Committee (JPC) following a meeting between Christian leaders, led by P. Wilson of the Joint Action Forum on Minorities, and Union Home Minister Amit Shah.
The government has presented the proposed changes as an effort to strengthen transparency, accountability and regulatory supervision. However, the amendments also raise a broader question about the relationship between the executive and civil society, particularly because several of the proposed provisions could significantly expand the government’s authority over organisations receiving foreign contributions.
The proposed FCRA Amendment Bill It is important to begin with a clarification that is often missing from the public debate. The Church—whether Catholic, Protestant or belonging to another Christian denomination—has not maintained that it is opposed to the FCRA Bill as a whole. Christian institutions have consistently supported measures designed to improve transparency, financial accountability and scrutiny of funds received from both domestic and foreign sources. This raises an obvious question: if the objective is greater transparency and accountability, why have several Christian churches expressed such serious reservations about the proposed amendments?
The answer is often presented through a much narrower narrative. Sections of the right-wing political discourse and parts of the mainstream media have portrayed the Church’s opposition primarily as an attempt to protect foreign funding allegedly associated with religious conversions. Such an explanation, however, overlooks the much wider institutional and legal consequences that the proposed amendments may have.
A decade and a half of increasingly stringent FCRA regulation
Since the Foreign Contribution (Regulation) Act came into force in 2010, the framework governing foreign contributions has undergone repeated changes, including amendments in 2016, 2018 and 2020. Each successive round of amendments has introduced additional restrictions and compliance requirements concerning the receipt, administration and utilisation of foreign contributions.
The government’s stated justification has consistently centered on protecting India’s sovereignty, national interests and internal security from what it describes as foreign interference or activities contrary to national interests. Over time, the wider public discourse surrounding the FCRA has also incorporated concerns about alleged forced religious conversions and demographic changes in different parts of the country.
The 2020 amendment, for example, significantly tightened the financial framework applicable to organisations receiving foreign contributions. It required such organisations to receive foreign contributions through a designated FCRA account maintained with the State Bank of India’s New Delhi Main Branch. The amendment also strengthened the requirements relating to accounting for and demonstrating the utilisation of foreign contributions.
These developments demonstrate that organisations receiving foreign contributions have already been operating within an increasingly demanding regulatory environment.
The 2026 proposal, however, appears to raise a different and potentially more consequential issue.
From regulation of funds to the question of property
The most significant concern surrounding the proposed amendment is that it may extend beyond regulating foreign contributions and compliance procedures and enter the territory of constitutionally protected property rights.
This becomes particularly relevant in the context of Article 300A of the Constitution of India, which provides that no person may be deprived of property except by authority of law.
The question, therefore, is no longer confined to whether the government should impose stricter conditions on organisations receiving foreign contributions. It becomes a broader constitutional question: to what extent can a law intended to regulate foreign contributions be used to affect property accumulated by an organisation over many years?
That distinction is central to understanding why Christian institutions, in particular, have expressed apprehension about the proposed changes.
Why Christian institutions are particularly concerned
The concerns of Christian organisations cannot simply be understood through the lens of foreign funding or religious conversion. Another important factor is the sheer scale and nature of the institutional infrastructure operated by Christian organisations in India.
Christian institutions have also had to contend with what they regard as numerous unfounded legal allegations and cases over the decades, often with few convictions and little or no meaningful restitution where allegations ultimately prove baseless. Similarly, past instances in which FCRA licence of church-run institutions was cancelled without the authorities providing adequate grounds or reasons for such action, a gross violation of the statutory rules and regulations. While the bill is religion-neutral, an additional concern about how the new provisions might operate if they were to be applied selectively, falsely or unfairly.
According to figures cited from the Catholic Bishops’ Conference of India (CBCI) and the Catholic Health Association of India (CHAI), the Catholic Church in India operates more than 50,000 educational institutions, including approximately 400 colleges and six universities, alongside more than 3,500 medical institutions that collectively serve around 21 million patients every year.
Christian institutions also reportedly spend more than ₹300 crore annually on charitable activities, directly benefiting more than one million people.
The significance of these figures is not merely numerical. Many of these institutions have existed for decades and, in some cases, across generations. They have accumulated land, buildings, hospitals, schools, colleges and other infrastructure while navigating successive changes in legislation, taxation, financial regulation, licensing procedures and administrative requirements.
Every new compliance requirement consequently creates an additional administrative burden for organisations operating such institutions.
The compliance burden itself
One does not need to manage a large institution to understand how demanding the FCRA framework can become. Even receiving a relatively small amount of foreign contribution can trigger extensive documentation, accounting and reporting requirements.
In practical terms, an organisation receiving even ₹50 in foreign funds could find itself subject to a regulatory framework involving paperwork and compliance obligations that are disproportionate to the amount received.
Yet the church organisations have continued to operate within this framework and meet the filing and reporting requirements imposed upon them.
The concern with the 2026 proposal is that the consequences of a compliance failure may now extend much further.
Previously, the principal concern associated with cancellation of FCRA registration was the loss of the ability to receive foreign contributions and the consequences prescribed under the existing regulatory framework. The proposed amendment potentially introduces another dimension: the possibility that the status of an organisation’s FCRA registration could affect the treatment of assets associated with foreign contributions.
This leads to the fundamental question:
Should an administrative or regulatory lapse relating to foreign funding ultimately have consequences for property accumulated by an organisation over decades?
The significance of proposed Section 14B
One of the provisions attracting particular attention is proposed Section 14B, under which the FCRA registration of an organisation may, in specified circumstances, be deemed to have “ceased.”
The terminology is important because “cessation” may carry consequences substantially different from an ordinary compliance issue.
As described in the proposed amendment, the relevant circumstances include:
- Failure to renew the registration;
- An application for renewal being rejected by the Central Government; or
- Failure to obtain renewal before the existing certificate expires.
This represents an important distinction from the earlier framework.
Under the previous system, cancellation of registration was the principal route through which the government could take action against an organisation’s FCRA status, subject to the procedures prescribed by law. The proposed amendment introduces non-renewal itself as a circumstance capable of resulting in the cessation of registration.
The subsequent consequences become particularly significant when read alongside proposed Section 16A.
When foreign-funded assets enter the equation
The proposed Section 16A provides that foreign contributions and assets created from foreign contributions belonging to an organisation whose registration has been cancelled, surrendered or ceased may provisionally vest in a Designated Authority, unless and until the registration is deemed to have been renewed.
This provision raises a number of practical and legal questions.
Consider an organisation that has gradually become financially self-sufficient. Having decided that it no longer needs foreign contributions, it may choose not to continue seeking renewal of its FCRA registration.
The question then becomes whether voluntary cessation of foreign funding should have any connection with the treatment of assets that the organisation has lawfully accumulated over decades.
The distinction between an organisation voluntarily discontinuing its reliance on foreign contributions and the government cancelling its registration because of statutory violations is therefore critical.
A regulatory framework designed to control foreign contributions should not, in principle, automatically transform the decision to stop receiving such contributions into a mechanism for transferring control over an institution’s accumulated property.
The problem of mixed-funded assets
Perhaps one of the most difficult practical issues arises under proposed Section 16A (2).
The provision contemplates circumstances in which an asset has been created partly from foreign contributions and partly from other sources. In such circumstances, the entire asset may initially vest in the Designated Authority. The organisation may then seek the return of the portion attributable to non-foreign sources, provided that such portion is “distinct or ascertainable.”
This is where the practical difficulty becomes apparent.
Imagine a Christian charitable organisation operating a hospital constructed and developed over several decades through multiple sources of funding:
- ₹3 crore from foreign Catholic donations;
- ₹5 crore from Indian Catholic donations;
- ₹1 crore from diocesan funds; and
- ₹1 crore raised through local fundraising.
The hospital is not necessarily divided into physically identifiable sections according to the source of every rupee spent on its construction.
Its land may have been purchased with one source of funding, the original building constructed with another, subsequent extensions financed through different donations, and medical equipment acquired through yet other sources. Renovations, maintenance, repairs and infrastructure improvements may have been funded through still other contributions.
In such circumstances, how does one determine which physical or legal portion of the hospital represents the foreign-funded component?
This is where the phrase “distinct or ascertainable” becomes particularly important.
If the organisation cannot clearly identify the portion attributable to non-foreign contributions, the practical ability to reclaim that portion may become considerably more complicated.
And the consequences may extend even further.
If the organisation fails to complete the required renewal, restoration or fresh application within the prescribed period, the foreign contribution and assets created from it could ultimately vest permanently in the Designated Authority.
The issue, therefore, is not simply about accounting for foreign donations. It potentially involves determining the ownership and control of physical assets that may have been created through decades of blended funding.
The devil is in the details.
Why the distinction matters
This is precisely why the proposed amendment deserves careful examination beyond the political arguments surrounding foreign funding and religious conversion.
It becomes a question of how the contribution can be traced, how the resulting asset can be identified, and what happens when the asset cannot be physically or legally separated into foreign-funded and domestically funded portions.
What happens next?
A JPC can examine a proposed law in considerable detail. It may scrutinise individual clauses, hear representations from the government and relevant stakeholders, examine concerns raised by affected organisations and recommend amendments. Its recommendations, however, are advisory rather than binding on the government.
If the proposed referral is formally moved and approved, the process could provide additional time for Parliament and the government to examine the concerns surrounding the asset-vesting provisions and their possible consequences for charitable, educational and religious institutions.
India’s democratic framework depends not only upon effective regulation but also upon an independent and vibrant civil society. Regulatory mechanisms must therefore be designed and implemented in a manner that protects national interests without inadvertently turning compliance requirements into a means of excessive executive control over institutions and assets.
The debate over the 2026 FCRA amendments should ultimately be about finding that balance.
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Author’s note: This article has been researched and prepared by the author, drawing upon the Press Information Bureau’s, Delhi most recent press statement concerning the proposed amendment and the 2026 draft amendment Bill. The legal provisions discussed above are based on the draft text and should be read in that context.
Source: Press Information Bureau, Government of India.