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Curbs on Financing of Civil Society Bodies


In less than a year after suspending the Foreign Contribution (Regulation) Act (FCRA) license of the Centre for Policy Research (CPR), the Government of India has now revoked its FCRA license. The rationale behind this action—associating CPR’s publications with current affairs programming, which is prohibited for an entity using FCRA funds—seems absurd.



  • Government Policies and Interventions
  • Non-Governmental Organisations (NGOs)

Mains Question:

“Curbs on financing of civil society bodies denote eroding civil liberties.” Analyse in the context of the recent suspension of the Foreign Contribution (Regulation) Act (FCRA) license of the Centre for Policy Research (CPR). (10 Marks, 150 Words).

Centre for Policy Research (CPR):

  • The Government of India acknowledges CPR as a non-profit society, and contributions made to the Centre are eligible for tax exemptions, as stated on its website.
  • CPR is a recipient of grants from the Indian Council for Social Science Research (ICSSR) and is recognized as an institution by the Department of Science and Technology.
  • CPR obtains grants from diverse domestic and international sources, encompassing foundations, corporate philanthropy, government entities, and multilateral agencies.
  • As a prominent think tank with a history spanning more than half a century, CPR has served as a model of public-spirited scholarship contributing to a governance and policy-making ecosystem.
  • This environment involves multiple stakeholders with often divergent interests that necessitate consensus-building through informed debates—an essential characteristic of a democracy.

Foreign Contribution (Regulation) Act (FCRA):

  • The Foreign Contribution (Regulation) Act (FCRA) was enacted during the Emergency in 1976, prompted by concerns that foreign powers were interfering in India’s affairs by channeling funds through independent organizations.
  • The primary objective of the law was to regulate foreign donations to individuals and associations.
  • In 2010, an amended version of FCRA was introduced to “consolidate the law” regarding the utilization of foreign funds and “to prohibit” their use for activities deemed detrimental to national interest.
  • Subsequently, in 2020, further amendments were made, granting the government increased control and scrutiny over the receipt and utilization of foreign funds by NGOs.
  • FCRA mandates that any individual or NGO seeking to receive foreign donations must:
  • Be registered under the Act.
  • Open a bank account for the receipt of foreign funds in the State Bank of India, Delhi.
  • Utilize those funds solely for the purpose for which they have been received, following the stipulations in the Act.
  • The Act expressly prohibits the receipt of foreign funds by candidates for elections, journalists or entities involved in newspaper and media broadcast, judges, government servants, members of the legislature, political parties, or their office-bearers, as well as organizations of a political nature.
  • Upon the enactment of the latest amendments in 2020, the International Commission of Jurists condemned them as “incompatible with international law” and cautioned that they would “impose… extraordinary obstacles on the capacity of… civil society actors to carry out their important work.”
  • It seems the government has been actively validating the concerns raised by the ICJ. Even before the dust could settle on the FCRA cancellation of CPR, World Vision India, an organization focused on children, has also faced FCRA cancellation.

Analysing the Government’s Recent Move:

  • Opting to essentially shut down such an institution by undermining its financial stability sends a message that India may no longer be receptive to the free flow of knowledge and ideas.
  • This move aligns with a recurring pattern wherein the state employs the FCRA as a tool to stifle entities whose work it disapproves of, typically those focused on environmental issues, civil liberties, and human rights.
  • The use of the FCRA to target civil society for political or ideological reasons appears to be ingrained in its history.
  • The legislation originated during the Emergency, enacted by a regime concerned about foreign governments interfering in India’s internal affairs by channeling funds through NGOs. Since then, it has undergone amendments by successive governments, with the provisions becoming increasingly stringent.

Democracy and Civil Liberties:

  • On one hand, India aspires to be recognized as a ‘Vishwaguru,’ and it proudly claims the title of the ‘Mother of Democracy’ as the host of the G-20.
  • The government displays hypersensitivity to international rankings while simultaneously refusing to acknowledge the interconnectedness of perception and reality.
  • When the U.S.-based non-profit, Freedom House, downgraded India to an “electoral autocracy” in its Democracy Index, it cited the erosion of civil liberties as one of the reasons.


The act of cutting off the finances of civil society organizations on unsubstantial grounds serves as a clear instance of the erosion of civil liberties, likely to intensify the narrative of democratic regression. It becomes futile to complain about bias or invoke “conspiracies” to tarnish India’s image when these actions contribute to India’s decline in global indices measuring freedom and democracy.

March 2024