Another round of electoral bonds were sold ahead of the 2020 Bihar Assembly elections, once again routed through select branches of the State Bank of India (SBI) in October. Information gathered under the Right to Information (RTI) reveals that SBI sold electoral bonds worth Rs 282 crore in a span of 10 days (19 to 28 October).
Interestingly though, while the elections were in Bihar, electoral bonds worth a paltry Rs 80 lakhs were bought within Bihar, less than 0.3% of the total amount donated!
Close to 68% of political donations for the Bihar Elections via electoral bonds came from Mumbai and Chennai.
This clearly indicates that donations are not being contributed by common people or the local voters of the state. Most likely, corporate houses continue to infuse large sums of money into the election process anonymously via electoral bonds.Anjali Bhardwaj, Transparency Activist
As we know, the electoral bond scheme does not allow revealing the identity of the donor.
Former finance minister, late Arun Jaitley, defended the electoral bonds scheme and its opacity, saying, “If you ask donors to disclose their identity, then I am afraid the cash system will be back.”
But former Chief Information Commissioner Wajahat Habibullah says, "Political donations via anonymous electoral bonds allow unaccounted money to be used to fund elections, and this goes against the principles of genuine democratic elections”.
Jaitley had also said that political donations “come from a range of sources from political workers, sympathisers, small business people and even large industrialists.” However, the figures of electoral bonds sold in last two years clearly show that only big corporates and industrialists are making donations. RTI replies reveal that 99% of electoral bonds printed in the smaller denominations of Rs 1,000 and Rs 10,000, remain unsold.
People who give big donations are also given favours in return by political parties. Therefore, the political parties and donors do not want donations to be known to the public so that their connections are not established.Jagdeep Chhokar,
Electoral bonds are issued in five denominations by the SBI, Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh and Rs 1 crore.
RTI replies received by transparency activist Commodore Lokesh Batra (Retd) and Vihar Durve reveal that close to 98% of the electoral bonds sold were of the Rs 1 crore denomination.
Denomination-wise Details of Electoral Bonds Sold Before 2020 Bihar Elections:
Patna Bought Bonds Worth Just Rs 80 Lakhs
The sale of electoral bonds in October 2020, timed around the Bihar Assembly polls, took place at nine SBI branches. As mentioned earlier, of the total value of Rs 282 crores of the electoral bonds sold, bonds worth just Rs 80 lakhs were bought in Patna. It is not clear whether the money spent on bonds purchased, for instance, in Mumbai or Chennai, that accounted for close to 68% of the value of the bonds sold, was even destined for use in the Bihar elections.
From the concentration of electoral bonds purchases in the biggest metros, it’s clear that the bonds are being bought by big corporates. If they were specific to Bihar then far more bonds would have been bought in Patna. Common or local people are not donating at all for the elections.Jagdeep Chhokar,
An analysis of electoral bonds by the Association for Democratic Reforms (ADR) shows that the five top cities in terms of value of bonds purchased, between March 2018 to January 2020, are; Mumbai, Kolkata, New Delhi, Hyderabad and Bhubaneshwar.
The sale of bonds before Bihar elections continues to show the dominance of these same big metros.
After the sale of this, the fourteenth tranche of electoral bonds, the value of bonds purchased for political donations stands at Rs 6,493 crores.
The electoral bonds scheme was introduced by the BJP-led government in 2018 with the promise of making the political funding process transparent.
The Quint has published a series of reports raising questions about the electoral bonds scheme, repeatedly flagging the threat they pose to democracy.
The articles have even highlighted concerns about electoral bonds that were shared by the EC and the RBI with the central government, including fears of benami transactions, money laundering, and also about the information asymmetry in favour of the ruling party that the presence of secret numbers embedded in the bond certificates.
In 2018, a petition was filed in the Supreme Court by NGOs Common Cause and Association for Democratic Reforms, citing The Quint’s article revealing the opacity of the scheme, but the matter is still pending in the court.
“It is extremely unfortunate that the challenge to electoral bonds in the Supreme Court continues to languish while the instrument is used repeatedly to influence electoral outcomes. Voters are left in the dark about who are funding political parties and are therefore going to enjoy the patronage of these parties once they come to power,” said Anjali Bhardwaj, transparency activist.