Electoral bonds must be scrapped

A report compiled and released by the Association for Democratic Reforms on the payments made to political parties through electoral bonds has again confirmed the validity of the criticism of this method of political donations. Maximum donations to political parties were made via electoral bonds between 2016-17 and 2021-22. They accounted for over 53 per cent of the total donations received by the national parties and over 65 per cent of donations received by regional parties. Over 52 per cent of all donations went to the BJP. The donations received by the party were three times more than those received by six other national parties combined. Over 28 per cent of the donations were made by the corporate sector. That raises the question as to which individuals made the other 70 per cent of donations, most of which are in the Rs 1 crore denomination bond. The figures reveal how electoral bonds have distorted the country’s politics and policies.

Also Read | What are electoral bonds?

The report shows that the BJP has got the lion’s share of all political donations in the past six years and other parties do not come anywhere near it. This is not only because the ruling party has a natural advantage as a recipient but because it has access to information that others do not have. The donations are made through government-controlled banking channels. Though other parties do not know the source of donations, the government, and thus the ruling party, has access to it. It can persuade or even coerce donors against making donations to other parties. Lack of transparency is the biggest flaw of the electoral bonds system. In a democracy, people have the right to know, and must know, who makes payments to which political party and how much, and whether those donations impact the policies of governments and parties. 

The accounts of shell companies can be used by corporates to make donations. There is no limit on the donations that can be made by individuals and companies through electoral bonds. Money is a major factor in elections and so the salient features of the electoral bonds scheme can well be used to distort elections. Any system of political donations should be transparent, simple, and fair and should give equal treatment to all parties. The argument that the bonds do not involve black money is meaningless because its impact, given the amounts involved and the anonymity, is the same as that of black money in elections. It facilitates corruption. Both the Election Commission and the Reserve Bank of India have expressed concern over them. It is unfortunate that the Supreme Court has not been able to take a view on electoral bonds, though it involves issues that are basic to electoral democracy.