Govt bid to allow foreign funding of parties

At a time when the Narendra Modi government has clamped down on non-governmental organisations (NGOs) over foreign funding, it has proposed an amendment with retrospective effect that will allow political parties to accept donations from overseas companies whose ownership of Indian entities is within the foreign investment limits prescribed for the sector.
Until now, the Foreign Contribution (Regulation) Act, 2010, or FCRA, banned political parties from receiving funds from any foreign source. The original law defines "foreign source" to include any company with foreign investment of above 50 per cent.
Finance Minister Arun Jaitley proposed the amendment to this, which had until now gone unnoticed, in the Finance Bill as part of the Union Budget of 2016-17 that he presented on February 29. The amendment is retrospective and will come into effect from 2010, when the FCRA was introduced.
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