What Is The FCRA 2020 Bill Recently Passed In Lok Sabha?

What Is The FCRA 2020 Bill Recently Passed In Lok Sabha?

The Lok Sabha passed the Foreign Contribution (Regulation) Amendment (FCRA) Bill 2020 on 21 September, changing rules regarding funds for Indian NGOs from foreign while tightening the existing laws.

Crux of the Matter

If you want to know how NGOs function in India, read this interesting and simplified piece on NGOs in India: Understanding NGOs In India

Passed Bills
On 21 September 2020, the Foreign Contribution (Regulation) Amendment (FCRA) Bill 2020 was passed in the Lok Sabha. The bill would amend the Foreign Contribution (Regulation) Act, 2010. In its statement, the Government claimed that the laws are “not against NGOs” and only seek to “stop misuse of foreign contributions by people”.

Features
The Bill would do the following if passed by the Rajya Sabha and the President:

  • Prohibit “public servants” and “corporations owned or controlled by the government” from receiving funds from outside India.
  • Reduce the maximum limit for expenditure on administration to 20% of the total foreign funding from the earlier limit of 50%.
  • Allow the Government to stop the use of funds for offenders by holding a “summary inquiry”. Previously, the action was taken only after the entity was “found guilty” of breaching the laws.
  • Ban the transfer of “grants” obtained under FCRA to “any other person or organisation”.
  • Foreign funds would be transferred only to ‘‘FCRA Accounts” in SBI Banks in New Delhi for people granted permission under section 12. However, provision to open more accounts in other banks to utilize the funds is present in the bill.
  • Aadhaar cards would be made compulsory for “all office-bearers, directors and other key functionaries of NGOs or associations eligible to receive foreign donations”.
  • Allow Government to cancel the FCRA certificate of an entity for more than 180 days (earlier limit).

The Home Ministry noted the alleged misuse of foreign funds by organizations like Greenpeace, Amnesty International, Citizen for Justice and Peace (CJP), etc. In the amendment, it has been claimed that the “annual inflow of foreign contribution has almost doubled between the years 2010 and 2019, but many recipients of foreign contribution have not utilised the same for the purpose for which they were registered”.

Criticism

  • Critics claim that the Bill is designed to discourage foreign funding for social work in India by making the process more complex and binding.
  • They also brought the issue of the PM Cares Fund which has been exempted from FCRA.

The most severe criticism of the decision has come for political parties which are still exempted from the FCRA.

  • 2014: Delhi High Court found BJP and Congress guilty of receiving foreign funding.
  • 2016: Government changed the definition of Foreign companies – claimed that any firm having less than 50% of “share capital” held by foreign entities would be Indian.
  • 2018: Foreign Contribution (Regulation) Act (FCRA) was amended with a ‘retrospective effect’, with the foreign funds received by political parties since 1976 being freed from supervision.

Curiopedia
  • Advocacy groups, also known as special interest groups, use various forms of advocacy in order to influence public opinion and ultimately policy. They play an important role in the development of political and social systems. Groups such as these have secured the nature of their influence by gaining status as nongovernmental organisations (NGOs). 
  • The Servants of India Society was formed in Maharashtra, in 1905 by Gopal Krishna Gokhale. The Society organized many campaigns to promote education, sanitation, health care and fight the social evils of untouchability and discrimination, alcoholism, poverty, oppression of women and domestic abuse.
  • Ashoka is an international organization that promotes social entrepreneurship by affiliating individual social entrepreneurs into the Ashoka organization. Each Ashoka fellow receives a financial stipend that the fellow can use to pay for their personal expenses so that they can fully devote their time in pursuit of innovative social ideas.

Understanding NGOs In India

Understanding NGOs In India

Lok Sabha recently passed the Foreign Contribution (Regulation) Amendment (FCRA) Bill 2020, changing rules regarding funds for Indian NGOs from foreign while tightening the existing laws. Before we get into the details of the Bill, let’s understand definition of non-governmental organizations in India, what are their types, difference between NGOs and non-for-profit organizations, and see some interesting stats around it.

Crux of the Matter

What Are Non-Governmental Organizations (NGOs)?
There is a lack of clear definition of Non-Governmental organizations (NGOs) since it represents a variety of different interests and a multitude of not-for-profit activities. However, the general definition says that NGOs are organizations formed by people on a voluntary basis working independently of government intervention in India.

The term NGO is used to denote an umbrella of not-for-profit organizations. NGO may be a non-governmental, quasi or semi-governmental, voluntary or non-voluntary, partisan or non-partisan, formal or informal, non-profit, or profit-oriented bodies, with legal status and registered under different Acts.

NGOs V/S NPOs
Non-for-Profit Organizations (NPOs) are formed as a legal entity working for welfare but no working member takes part in part in profit or loss. NGOs can be trust, society, or non-profit making company but NPOs can only be non-profit-making companies, i.e. NPOs are a category of NGO.

The working spectrum of NGOs is very wide i.e. betterment, upliftment, and development of society and economy as well, bringing awareness of human rights, women empowerment, etc. Whereas, NPOs work in particular fields like promoting art, science, research, commerce or any other useful purpose.

Types Of NGOs On Legal Basis

  • Trust – Trusts, private or public, can be charitable organizations registered under the Indian Trust Act, 1882; Public charitable trust is exempt from Income Tax.
  • Society – It is another form of NGO that can be registered under the Societies Registration Act, 1860. It may be entitled to Income Tax exemption if it falls under certain charitable aspects as directed by the Income Tax department.
  • Section 8 Company – Not-for-profit organizations (NPOs) can be formed under Section 8 of the Companies Act, 2013.

Section 8 companies, trust, and societies are exempt from income tax if registered under 12AA (tax exemption) of the Income Tax Act. To get fund from abroad NGOs are required to register under the Foreign Contribution Regulation Act (FCRA) with the Ministry of Home Affairs.

Misuse
NGOs can be misused to convert black money to white or legal money. To do so, black money is donated to NGOs and later NGOs return it as payment for goods or services it was supposed to purchase. By doing so, a taxpayer gets tax exemption for the “contribution” and trust gets tax exemption for the money received. The government can reject an NGO’s permit if it is found guilty or can also charge it with a hefty fine.

To know about the recently passed FCRA 2020 Bill, read this story: What Is The FCRA 2020 Bill Recently Passed In Lok Sabha?

Curiopedia
  • International non-governmental organizations date back to at least the late 18th century, and there were an estimated 1,083 NGOs by 1914. International NGOs were important to the anti-slavery and women’s suffrage movements, and peaked at the time of the 1932–1934 World Disarmament Conference.
  • Social entrepreneurship is an approach by individuals, groups, start-up companies or entrepreneurs, in which they develop, fund and implement solutions to social, cultural, or environmental issues. For-profit entrepreneurs typically measure performance using business metrics like profit, revenues and increases in stock prices. Social entrepreneurs, however, are either non-profits, or they blend for-profit goals with generating a positive “return to society”.
  • The International Red Cross and Red Crescent Movement is an international humanitarian movement with approximately 97 million volunteers, members and staff worldwide which was founded to protect human life and health, to ensure respect for all human beings, and to prevent and alleviate human suffering.

Feluda Covid-19 Test Approved, To Enter The Market Soon

Feluda Covid-19 Test Approved, To Enter The Market Soon

The launch of India’s first indigenous, paper-based, Covid-19 testing kit, Feluda has been approved for commercial launch by the Drugs Controller General of India (DCGI). How does it work? What about its availability and cost? Will it be a gamechanger? Let’s find out.

Crux of the Matter

What Is Feluda?
Feluda, an acronym for FNCAS9 Editor-Limited Uniform Detection Assay, is a paper-based test strip to identify the presence of Coronavirus in a sample. The name gets its inspiration from the famous Bengali fictional detective character, Feluda penned by Satyajit Ray.

It was developed by the TATA group and the Institute of Genomics and Integrative Biology (CSIR-IGIB), New Delhi by Dr. Souvik Maiti, and Dr. Debojyoti Chakraborty.

What Is The Test Based On?
This indigenous test is based on CRISPR or Clustered Regularly Interspaced Short Palindromic Repeats, a gene editing technology. It is used in correcting genetic defects and preventing the spread of diseases, by detecting all the pathogens responsible for them.

This is because it can detect specific sequences of DNA within a gene and use an enzyme functioning as ‘molecular scissors‘ to snip it. The US had approved the emergency-use of the world’s first CRISPR-based test for Covid-19, developed by MIT and Harvard, earlier this year, in May.

What About FNCAS9?
It is a protein used by researchers to edit our DNA and is derived from a bacterium, Francisella novicida. In Feluda test, FNCAS9 has been coded to interact with SARS-COV-2, which makes detection and confirmation speedy.

So How Will Feluda Know?
Similar to a pregnancy detection test, Feluda paper kit will change colours, if a positive diagnosis is identified. It shall carry two lines on the kit – one control and a test line to interpret results.

What About Its Accuracy?
As per the Ministry of Science and Technology, Feluda has 96% sensitivity and 98% specificity for detecting Covid-19. Test sensitivity is the ability of the test to correctly identify those with the SARS-COV-2 virus (true positive rate), whereas test specificity is the ability of the test to correctly identify those without the virus (true negative rate).
To know more, check out this piece.

Positive Step For India
The commercialization of Feluda would be an important step for us as it would be a “Made in India” initiative, that would highlight the increasing R&D talent in the country.

Girish Krishnamurthy, CEO, TATA Medical and Diagnostics Ltd, said, “We can then collaborate and contribute to the global healthcare and scientific research world.”

Curiopedia
  • Feludar Goendagiri is a short story written by Satyajit Ray featuring Feluda. It was the very first among the total 35 complete stories/novels of the Feluda series.
  • The Apu Trilogy comprises three Indian Bengali language films directed by Satyajit Ray. They are frequently listed among the greatest films of all time and are often cited as the greatest films in the history of Indian cinema.
  • Sandesh is a Bengali children’s magazine. It was first published by Upendrakishore Ray in 1913. In 1961, the magazine was revived under the editorialship of Satyajit Ray. Ray introduced Feluda in short stories he wrote for Sandesh.

New Farm Bills In India: Features And Impact

New Farm Bills In India: Features And Impact

With the Rajya Sabha passing two major bills related to farmers and their business, let us look at the salient features of the farm bills while noting their impact on the farmers.

Crux of the Matter

Passed Bills
On 20 September, 2020, the Rajya Sabha passed two farm bills passed in the Lok Sabha previously –

  • The Farmers Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020.
  • The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020.

On 21 September, the Essential Commodities (Amendment) Bill was to be put in the Rajya Sabha.

Features Of The New Bills

The Farmers Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020

  • Allows farmers to sell their produce to buyers other than ‘mandis’ (market) regulated by Agricultural Produce Market Committee (APMC) – farmers can sell to private buyers too.
  • Adds the option of selling outside the state of the farmer.
  • Prohibits state governments from imposing market fee on “farmers, traders, and electronic trading platforms” for trading outside the ‘trade area’ or with a buyer other than the mandi.

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020

  • Allows agreement between farmers and buyers before the production.
  • Fixes a price before the production for the produce to be sold at.

The Essential Commodities (Amendment) Bill

  • Removes cereals, pulses, onion, potatoes, etc from the “list of essential commodities”.
  • Removes restrictions on storing – earlier, traders could be prosecuted for “hoarding” essential items.
  • Government intervention to occur only in cases of famine, war, or any extraordinary calamity.

Impact

  • Farmers would be freed from the middlemen who would lose ‘commission fees’ if the former move outside APMC.
  • Marketing prices would be reduced for the farmers.
  • The risk of market volatility would be transferred from farmers to buyers and sponsors.
  • Contract farming with a proper legal network would increase.

To put in perspective, 86% of “land holdings” by farmers are of less than 2 hectares according to Agriculture Census (2015-16). Consequently, these farmers with small lands end up as ‘net buyers’ of food and essential crops. Moreover, the MSP hikes distress these farmers the most.

  • Farmers would have more options for selling, now having a provision to sell to the private sector if better price is offered.
  • Farmers would be free from ‘mandi tax’ levied by the state.
  • APMC mandis would not be shut, with only an option of private sector being added for farmers.

PM Modi clarified on Twitter that the Minimum Support Price (MSP) and the Government Procurement would continue.

MSP – minimum price for a crop fixed by the Government before farming season – ensures that farmers don’t face loss in case of drastic price decline. The MSP is applicable to APMC only.

Also Read: New Farm Bills In India: Opposition And Reactions

Curiopedia
  • A price floor is a government- or group-imposed price control or limit on how low a price can be charged for a product, good, commodity, or service. Governments use price floors to keep certain prices from going too low. 
  • eNAM is an online trading platform for agricultural commodities in India. The market facilitates farmers, traders and buyers with online trading in commodities. The market transactions stood at ₹36,200 crores by January 2018, mostly intra-market. 
  • Jai Jawaan Jai Kisaan was a slogan by the second Prime Minister of India, Lal Bahadur Shastri, in 1965 at a public gathering in Delhi. In 2015, a film based on Shastri’s life was released which was named after this slogan.

New Farm Bills In India: Opposition And Reactions

New Farm Bills In India: Opposition And Reactions

The new farm bills passed in the Rajya Sabha have generated differing reactions to them, with opposition ranging from creating a ruckus in the Parliament to particular members supporting it.

To know about these bills, what changes they bring, and what can be their impact, immediate and long-term, read this story: New Farm Bills In India: Features And Impact

Crux of the Matter

Opposition Points
Following are the major points raised by the Opposition leaders against the new bills:

  • State Governments would lose revenue.
  • MSP is not applicable on private buyers, which might make farmers prone to corporate monopoly.
  • The move would mainly benefit the “Big Corporations” instead of farmers.
  • Lack of storage capacities (like cold storage), transport capacities, and lack of awareness regarding laws and bargain might bring more loss for farmers when dealing with corporations.

One such example used by the opposing faction was the recent ban on exporting Onion as the prices soared in the country. Critics have claimed that such moves in the future would affect farmers even more with private sector involvement.

Reactions

  • Harsimrat Kaur Badal of the Shiromani Akali Dal (SAD), one of the allies of the BJP, resigned from the post of Food Processing Industries Minister.
  • Ruckus was created in the Parliament as Rajya Sabha Deputy Chairman Harivansh extended the time of the House beyond 1 PM till a decision on the bill was reached, against which the Opposition demanded to adjourn the House on the scheduled time.
    Opposition leaders then broke the mics (including that of the Chairman) and threw papers in the air. 8 MPs including Derek O’Brien from TMC have been suspended for 1 week for the ruckus.
  • Farmer groups from Haryana, Punjab, and Maharashtra have been protesting against the Bills since weeks.
  • States like Bihar and Kerala have not implemented APMC.

Congress And Mixed Reaction
Congress has been a leading opponent of the farm bills. Spokesperson of the party Jaiveer Shergill claimed that “the Congress manifesto never promoted the idea of abolition of the Minimum Support Price (MSP), unlike the present bills passed by the BJP”.

However, suspended Congress leader Sanjay Jha favoured the Bills. In his tweet, Jha claimed that the “Congress Manifesto for 2019 Lok Sabha elections… had proposed abolition of APMC Act and making agricultural produce free from restrictions. This is what the Modi government has done in the farmer’s bills”.

Curiopedia
  • price floor is a government- or group-imposed price control or limit on how low a price can be charged for a product, good, commodity, or service. Governments use price floors to keep certain prices from going too low. 
  • eNAM is an online trading platform for agricultural commodities in India. The market facilitates farmers, traders and buyers with online trading in commodities. The market transactions stood at ₹36,200 crores by January 2018, mostly intra-market. 
  • Jai Jawaan Jai Kisaan was a slogan by the second Prime Minister of India, Lal Bahadur Shastri, in 1965 at a public gathering in Delhi. In 2015, a film based on Shastri’s life was released which was named after this slogan.