Status of FCRA Bill of 2006

Growing threat to the internal security and quantum jump in the foreign contribution
were some of the reasons cited by the Home Ministry in the year 2004 when it decided to
amend the existing Foreign Contribution (Regulation) Act 1976. The Ministry was of the
opinion that this large sum of money coming through foreign sources should not fall into
wrong hands i.e. those who are working against the interest of the country. The ministry
later organised a consultation in June 2005 to discuss the proposed amendments in light
of the existing scenario.

The amendments proposed by the Ministry were later referred to the cabinet. Fortunately
the cabinet felt the need to have a wider debate on the bill and further referred it to the
Group of Ministers (GoM), consisting of heavyweights such as Shri. Sharad Pawar, Shri.
Shivraj Patil, Shri. Arjun Singh, Smt. Meera Kumar, Shri. Hansraj Bharadwaj, Shri. PR
Kindia and a representative from the Planning Commission.

On June 24 and 25 (2005), Ministry of Home Affairs and The Institute of Chartered
Accountants organised first ever seminar on FCRA, 1976. The Seminar appeared to be a
curtain raiser on FCMC Bill, 2005. In the seminar Dr. Rajesh Tandon, Chairperson
VANI, emphatically expressed the concerns of NGOs and appealed to the government to
be equally liberal with the NGOs and facilitate their smooth functioning. Mr. Vijay
Mahajan, CEO, BASIX in his deliberations seconded Dr. Tandon and explained the
practical problems NGOs face due to cumbersome FCRA provisions. Hon’ble Finance
Minister applauded the kind of work NGOs are doing and appealed for their support. The
seminar was on the issue of FCRA that concerns the NGOs. But the very fact that it
included only two speakers from the sector shows the diminutive respect shown by the
organisers.

After hearing from the ministry of home officials that the government has referred the
matter to a GoM which will look into the issues, repeal the existing FCRA Act and bring
out another Act that will be known as Foreign Contribution Management and Control Act
(FCMC), VANI approached all concerned stakeholders including parliamentarians,
media, think-tanks, foundations, religious and minority communities, inter-governmental
organizations etc to impress upon the government about the need to have an
institutionalized dialogue with the voluntary sector in the process of making the law.

In the meantime the process to evolve a policy on voluntary sector was under way. The
whole policy on the sector was being facilitated by the Planning Commission and written
by the voluntary sector representatives. It was suggested that as the policy on the
voluntary sector is underway and a result the sector should first have a policy on the
sector and later on FCRA. This has also been the position of the Planning Commission all
through. Four task forces constituted to frame the national policy were put in place and
now the policy is at the advanced stage of finalization.
Meanwhile on behalf of the civil society, VANI continued meeting ICAI and High
Commissioners of various Embassies’ advocating for complete withdrawal of some of
the proposed draconian amendments in the said Bill. National Human Rights
Commission, NRI and various associations like – FICCI, CII, Assocham were also
contacted. Think tanks of various universities, organisations like Center for Policy
research, Common Wealth Foundation, Rajiv Gandhi Foundation, NHRC and senior
bureaucrats were also contacted to talk to the ministry officials and the government
regarding the issue and they all supported us in terms of taking the issue at the highest
levels.

VANI also mobilized its state partners to launch active advocacy campaign nation wide.
Parliamentarians were also approached in order to gather their support. A total of 37
meetings took place and state networks and organizations also wrote to the ministry. In
response to a question raised by an M.P from Maharashtra on the floor of the house, the
minister of state for home admitted getting about 700 representations from various
voluntary associations and the ministry was looking into each one of those. He also
assured the house that every care will be taken to capture the sentiments of the sector and
then only a law will be enacted.

Amidst all this, ministry of home affairs prepared a Cabinet note for passing Ordnance on
FCMC. However, the Cabinet after considering all the pros and cons decided to scuttle
the move of MHA for Ordnance. Every action taken by the ministry was justified in the
name of security. VANI’s efforts also proved fruitful as it could act in time and the
Ordnance was scuttled on legal grounds as the move was made after the dates for the
Parliament session had been announced by the government.

Due to our consistent efforts, the government decided to drop FCMC and agreed to
amend the existing FCRA. This was disclosed by the then joint secretary (foreigner)
during his address to VANI members during our national convention that took place
during 28-29 the August, 2006.

Meanwhile, the winter session of the Parliament was approaching (22 Nov – 19 Dec
2007). On 16 December 2006 it was learnt that the FCR Bill was likely to be introduced
in the parliament in the winter session itself. When this news was confirmed, VANI did
the appropriate advocacy and lobbying and the process gathered heat. Parliamentarians
were contacted and convinced that the FCRA Bill, if introduced and passed, will be
difficult for the voluntary sector. After a high drama advocacy, it was decided that the
Bill should be referred to the standing committee after it is introduced in the Rajya Sabha.
It may be noted that FCRA bill is amongst a few bills that was introduced in Rajya
Sabha. A department related Parliamentary Standing Committee has been set up with
Smt. Sushma Swaraj as its chairperson and 30 M.P’s from both the houses of parliament.
(A list of the Parliamentary Standing Committee members is enclosed as Annexure
–I). The standing committee will look into the issues, consult the stakeholders, prepare its
report and submit to the cabinet for their consideration. Once the cabinet clears it, the
same will go to the parliament for final passage of the bill. Before the bill becomes an
act, it will need President’s approval. As such, the process is expected to take about 10
months and senior observers in the government opine that the bill should be ready by the
next winter session of Parliament that usually takes places during last week of November
to third week of December.

VANI in the meantime also facilitated signing of a petition by fifty leading civil society
representatives and sent the same both to the Prime Minister and to Mrs. Sonia Gandhi on
18 December 2006, listing the concerns of the voluntary sector arising out of the
proposed FCRA bill of 2006.

Following our intense advocacy, VANI representatives were invited by the Hon’ble
union minister of home affairs Shri. Shivraj Patil to share our concerns with him. A small
delegation of VANI working committee met with the Home Minister Shri Shivraj Patil
on 9 January 2007 to share the concerns of the civil society. Later a meeting was held at
VANI’s office on 13 January 2007 to discuss the FCR Bill and develop plan of action. In
the meeting it was decided that a critique of the Bill as well as section wise analysis of it
should be submitted to the Home Minister. The Hon'ble minister was sympathetic to our
concerns and advised us to send a memorandum on issues that the sector is not
comfortable with. He also assured the VANI delegation that VANI will be invited to
make a physical deposition on FCRA before the Parliamentary Standing Committee once
the process of doing so goes underway.

On 18 January 2007, a meeting was called by the Joint Women’s Programme at All India
Women’s Conference to discuss the provisions of the FCR Bill 2006 and plan of action.
The group was briefed about the history and provisions of the bill by the CEO – VANI. It
was decided that a meeting at a wider scale will be organised in the last week of February
to discuss the future course of action. Networking and lobbying at a much larger scale
was suggested during the course of the discussion.

In the meantime, we also have written to our members to start holding meetings in their
region, area and locality to sensitise the local FCRA registered associations about the
developments on the FCRA and provide their feedback to VANI as soon as possible.
Meetings in U.P, Maharasthra, Jharkhand, Chattisgarh, Tamil Naidu have already starting
taking place. States in the North east and Goa are also holding the meetings on FCRA.
We also request our members from their concerned locations to also contact their local
M.Ps and advocate the FCRA issue with them. This will help us build a fair deal of
negotiating space from different parts of the country.

Policy process: How it moves and happens

1. The issue/s are decided and taken up by the concerned ministry and considered by
a core committee.
2. Recommendations of the core committee are sent to the Cabinet for its
consideration
3. Cabinet may refer the matter to the Group of Ministers (GoM) for its considered
opinion and advice.
4. GoM after considering the matter in detail (including consideration of the issue by
concerned ministries and departments), sends the same to Cabinet.
5. Cabinet considers the matters and presents before the parliament.
6. The process may go through either the lower house or upper one and has to pass
through a three tier stage – introduction, consideration and passage. Many a times,
three processes take place at one go.
7. When the matter does not go through all of the above process may get referred to
the Parliamentary Standing Committee for more considered approach. This
standing committee has a chairperson and M.Ps from both the lower house and
upper house. The committee considers various aspects related to the matter,
invites suggestations and recommendations both in writing and also inviting a
select group of organizations to depose and finally puts its note to the cabinet.
8. The Cabinet once again considers the same and being satisfied send the matter to
the Parliament again for its passage.
9. Once passed, the matter awaits the approval of the President and becomes an Act.
10. The Act may still be challenged in court of law.