Certain Amendments to FCRA

Certain Amendments to FCRA

News: The Union Home Ministry has amended certain rules related to the Foreign Contribution(Regulation) Act (FCRA), allowing Indians to receive up to ₹10 lakh in a year from relatives staying abroad without informing the authorities. The earlier limit was ₹1 lakh.

What are the new rules?
• It allows Indians to receive up to ₹10 lakh in a year from relatives staying abroad without informing the authorities. The earlier limit was ₹1 lakh.
• In a notification, the Ministry also said that if the amount exceeds it, the individuals will now have 90 days to inform the government, instead of 30 days earlier.
• It made five more offences under the FCRA “compoundable” instead of directly prosecuting the organizations or individuals. Earlier, only seven offences under the FCRA were compoundable.
• The amended rules have given individuals and organizations or NGOs 45 days to inform the home ministry about the bank accounts that are to be used for the utilization of such funds.
• The government has also ‘omitted’ provision ‘b’ in rule 13, which dealt with declaring foreign funds.
• Now, anyone receiving foreign funds will have to follow the existing provision of placing the audited statement of accounts on receipts and utilization of the foreign contribution, including income and expenditure statement, receipt and payment account, and balance sheet, within nine months of the closure of the financial year on its official website or on the website as specified by the Centre.

Importance of Recent Amendments:
• Improves Remittances
• Stable Forex Reserve
• Reduces Trade Deficit