India's Overhaul of Its Foreign Funding Law Could Give the Government Control of LGBTQ+ Groups' Assets

Many of India’s LGBTQ+ organizations survive on foreign grants — funding from international human rights foundations and overseas donors that domestic Indian philanthropy, still wary of the topic, rarely provides. A bill moving through India’s Parliament could put that funding model, and the organizations that depend on it, in serious jeopardy.

The Foreign Contribution (Regulation) Amendment Bill, 2026, was introduced in the Lok Sabha in March and returned to the spotlight this month as the government prepared to push for its passage during Parliament’s monsoon session. It has drawn opposition from an unusually wide coalition — political parties, secular civil society groups, and religious organizations alike, all of which rely on foreign contributions in one form or another and would be affected by the bill’s new enforcement powers.

What the bill would actually do

The provision drawing the most alarm from advocacy groups is straightforward and severe: the bill would let a government-appointed “Designated Authority” take control of an organization’s foreign-funded assets — bank balances, equipment, in some cases even property — the moment its FCRA registration is cancelled, surrendered, or simply allowed to lapse. Under the current draft, that seizure happens through an administrative process, without prior judicial review. An organization could lose access to its own accounts before it ever gets the chance to argue its case in front of a judge.

India’s Home Ministry has defended the bill as a technical fix, saying it’s meant to close gaps in how foreign-funded assets are managed once an organization’s registration ends, rather than a tool aimed at any particular sector of civil society. But FCRA registration cancellations in India have a well-documented recent history of falling disproportionately on human rights groups, government critics, and organizations working on politically sensitive issues — and LGBTQ+ rights, in a country where the subject remains genuinely divisive in Parliament and among religious and social conservatives, has often fallen into that category.

Why LGBTQ+ groups specifically are worried

Souvik Saha, founder of People for Change and Jamshedpur Queer Circle, told the Washington Blade that three provisions in the bill worry organizations like his most directly, with the asset-seizure power topping the list. The concern isn’t abstract: many of India’s LGBTQ+ organizations operate on thin margins already, running shelters, legal aid clinics, and health outreach programs for a population that continues to face family rejection, workplace discrimination, and — outside India’s major cities — limited access to affirming healthcare or legal support.

For groups whose FCRA registration lapses for entirely bureaucratic reasons — a missed renewal deadline, a paperwork dispute, a delay in the government’s own review process — the prospect of having their bank accounts and equipment placed under government control before any court weighs in represents an existential threat, not a compliance headache. Amnesty International, in research published in July, warned more broadly that the new rules would tighten government control over civil society and undermine the constitutional right to freedom of association, a concern echoed by the International Center for Not-for-Profit Law’s analysis of the bill for civil society groups and donors.

The broader Indian context

The FCRA fight is unfolding against a backdrop that’s already difficult for LGBTQ+ Indians. The country’s Supreme Court declined in 2023 to extend marriage rights to same-sex couples, leaving that question to Parliament, which has shown little appetite to act. Earlier this year, India’s Parliament passed the Transgender Persons (Protection of Rights) Amendment Act, which advocacy groups criticized as a step backward — it removed the self-perceived gender identity standard that had been a hard-won protection, replacing it with a verification process that requires transgender people to have their identity approved by government authorities.

Against that backdrop, foreign funding has functioned as one of the few remaining resources LGBTQ+ organizations in India have been able to rely on independent of domestic political pressure. A bill that lets the government freeze or seize that funding through an administrative process, without a judge’s sign-off, would remove a layer of independence civil society groups have used for years to operate somewhat outside the reach of shifting political winds.

What happens next

The bill’s fate depends on the monsoon session, where the government holds enough of a majority to pass it if it chooses to push forward despite the opposition. Civil society groups, including LGBTQ+ organizations, have been lobbying for amendments that would require judicial review before any asset seizure — a change that would address their core objection without gutting the government’s stated goal of closing loopholes in how foreign funds are managed. Whether Parliament is willing to make that distinction, or whether the bill passes largely as written, will shape how much independent space India’s LGBTQ+ civil society has to operate in for years to come.