Oxfam India says restrictions on its access to international funds will have severe consequences for its humanitarian work and hinder provision of vital medical equipment to fight the Covid pandemic.
The charity group's local arm said a decision by the country's home ministry meant that from January 1 it was no longer able to receive foreign funding to finance relief work.
It comes just a week after India imposed the same restrictions on the Missionaries of Charity, founded by the late Catholic nun Mother Teresa.
Oxfam India chief Amitabh Behar said his organisation had worked closely with local partners to "provide life-saving equipment and support" during the pandemic.
The ministry's decision "will severely hamper these collaborations which were providing relief to those who needed it the most during times of crisis", he said in a Sunday statement.
Charities and non-profit firms in India need to register under the Foreign Contribution Regulation Act (FCRA) to receive money from abroad.
Prime Minister Narendra Modi's government has been accused of cutting off access to funding for rights groups and charities based in the country.
Mother Teresa's Missionaries of Charity, which runs shelter homes across India, had its permission revoked last week for "not meeting the eligibility conditions", according to the home ministry, which did not give further details.
In total the ministry refused to renew FCRA registration for 179 non-government organisations, according to The Hindu newspaper.
Amnesty International announced it was halting operations in India after the government froze its bank accounts in 2020.