However, the Foreign Contribution (Regulation) Amendment Bill, 2026 raises a different question altogether. It is hard to deny that the state has a legitimate concern in regulating foreign contributions in India, as foreign donations raise issues concerning national security, transparency in democracy, and public accountability. For decades, the Foreign Contribution (Regulation) Act has been the instrument through which this interest has been pursued. It goes beyond regulating foreign contributions, to the extent to which the state may intervene in assets and institutional activities associated with them.
The Bill’s most important aspect is a statutory framework for the vesting, supervision, management and disposal of foreign contributions and assets through a ‘Designated Authority’. The measure is framed as an accountability mechanism to prevent the diversion or abuse of such properties. In case of cancellation, surrender, or cessation of registration, the government may, through the Designated Authority, take possession of and manage assets created from foreign contributions and, where considered necessary or expedient in the public interest, undertake the management of the concerned organisation’s activities. This is not merely a change in administrative policy; it raises a constitutional question about the extent to which a statute regulating foreign contributions may permit executive authorities to assume possession and, in specified circumstances, management of institutional assets and activities. This is where the doctrine of constitutional proportionality may be relevant. The Supreme Court has repeatedly held that even where the state pursues a legitimate objective, the means it adopts must bear a reasonable connection to that objective and must maintain an appropriate balance between the public purpose and the burden imposed on rights. Its objective is not in doubt, but proportionality demands more than a legitimate end. It demands carefully calibrated means. If the consequence of losing FCRA registration is the provisional vesting of assets in, and potentially the management of institutional activities by a government-appointed authority, the safeguards attending that transfer must be commensurately robust. None of this suggests that the government lacks the authority to strengthen financial oversight or ensure that funds from abroad are used for lawful and proper ends. But in a constitutional order, any regime that reaches into the management of civil society’s institutional infrastructure must operate within clear legislative standards and adequate safeguards. Ultimately, the constitutional question posed by the FCRA Amendment Bill is not whether foreign contributions should be regulated, but how far the state may go in regulating institutions and their assets. The Bill may pursue a legitimate end, but the question Parliament must now carefully consider is whether the means are sufficiently proportionate and safeguarded to ensure that accountability does not become control. It is worth noting that The Bill has now been referred to a Joint Parliamentary Committee (JPC) for wider scrutiny following strong backlash from opposition parties and minority groups.
Where an organisation’s FCRA certificate is cancelled, surrendered or ceases to exist, including due to non-renewal, the Central government may appoint an authority to which the foreign contribution and assets created from it may vest provisionally.
The amendment raises difficult questions when measured against the said rationale.
