Kerala Assembly passes resolution urging Centre to withdraw amendments to FCRA rules

The Kerala Legislative Assembly on Wednesday, July 1, 2026, passed a resolution urging the Union government to repeal the amendments to the Foreign Contribution (Regulation) Act and Rules, terming it a “violation of the provisions of the Constitution and federal principles”.

Chief Minister VD Satheesan submitted the resolution stating that the Foreign Contribution (Regulation) Amendment Bill, 2026 and Foreign Contribution (Regulation) Amendment Rules, 2026 will throw voluntary organizations operating in the country into crisis.

The resolution was then put to a vote and passed in the Parliament; 111 members voted in favor and two members voted against.

The opposition CPI(M)-led Left Democratic Front (LDF) supported the Congress-led UDF government’s decision. The amendment proposed by BJP member V. Muraleedharan was rejected on the grounds that it was contrary to the content and spirit of the decision.

Mr. Satheesan said that the Foreign Contribution (Regulation) Amendment Rules, 2026, notified by the Center on June 22, 2026, has adversely affected voluntary and charitable organizations operating in the social, health, education and charity sectors of the country, especially in Kerala. The resolution stated that for decades, these registered organizations have been assisting the government machinery in ensuring the welfare of marginalized communities and providing support in the fields of education, healthcare, rehabilitation of the disabled and disaster management.

In the decision, it was stated that the provisions included in the Foreign Contribution (Regulation) Amendment Draft dated 2026 eliminated the autonomous character and democratic operating rights of these organizations in order to ensure transparency.

With the changes, the activities of the organizations are limited to 105 areas in five categories. Additionally, an organization registered in one State must obtain a new organization if it operates in another State. The rules impose strict penalties and create practical difficulties for voluntary organizations and non-governmental organisations. The judgment stated that stringent provisions such as provisions on ‘key officials’ and sub-allocation of funds hinder the functioning of NGOs and also deter individuals and organizations from participating in the activities of NGOs.

Additionally, the ruling stated that the provision that the government can seize assets created by an organization through foreign assistance using a ‘designated authority’ without court approval or judicial review if its FCRA license is cancelled, suspended or not renewed is a violation of natural justice and contrary to the fundamental concepts of the rule of law.

He also objected to the use of the term ‘religious propaganda’ in the program regarding religious activities, stating that this term could be misused to revoke the licenses of organizations.

Mr. Muraleedharan of the BJP proposed four amendments; one of them described the resolution opposing the bill passed by Parliament as a “politically motivated” move by the State Legislature and contrary to federal principles. The changes were rejected.