The government has tightened the funds regulations on the Non-Governmental Organisations (NGOs) as according to the new regulations, any organisation seeking registration under the Foreign Contribution (Regulation) Act (FCRA) must have operated for at least three years and spent “a minimum amount of Rs 15 lakh on its core activities for the benefit of society during the last three financial years”.

As per the new rules, 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 indicating the amount of foreign contribution and the purpose for which it is proposed to be given.

If the value of the foreign contribution is over Rs 1 crore, it may be given in instalments provided that the second and subsequent instalment shall be released after submission of proof of utilisation of 75 per cent of the foreign contribution received in the previous instalment and after field inquiry of the utilisation of foreign contribution.

The government has relaxed the rules for declaring an organization as political organization. Student, farmer, worker and youth organisations being exempted unless they participate in “active politics or party politics”.

Centre has also made an insertion in Rule 9 – which deals with obtaining registration or prior permission to receive foreign funds – which makes the process more cumbersome for NGOs.

The new rules are a follow-up on the amendments to the FCRA that the Centre pushed through in the last session of Parliament.