Yeh Jo India Hai Na | Electoral Bonds Need Transparency: The Voter Must Know

The ruling BJP may have envisaged itself as the biggest beneficiary of the electoral bonds system.

5 min read

Yeh Jo India Hai Na, here, why should the discussion around electoral bonds interest us? Why do they matter?

Here are some figures:

According to the Association of Democratic Reforms (ADR), political donations worth Rs 16,437 crore were received by seven national parties and 24 state parties in India between 2016-17 and 2021-22. Of this amount, Rs 9,188 crore, well over half, came to these parties via electoral bonds.

Significantly, the Bharatiya Janata Party (BJP) has benefitted the most from donations via electoral bonds, since they were launched in 2018.

Of the roughly 9,200 crore donated until 2022, the BJP got Rs 5,272 crore. That is more than all the other 30 political parties who have received donations via these bonds, put together.

For the record, the Congress is at a distant second, having received Rs 952 crore. The Trinamool Congress got Rs 768 crore, Biju Janata Dal Rs 622 crore, Dravida Munnetra Kazhagam Rs 431 crore, and so on.


The Right To Know About Political Donations

Yes, it’s a lot of money. And so, don’t we, the people, need to know who is giving all this money to our 'Netas’? Should the identities of these people who are donating hundreds of crores, remain hidden from us citizens? Also, what is it about the nature of the electoral bonds scheme that allows the BJP to walk away with the lion’s share of the money donated? We should want these answers.

But, guess what, the Central government thinks otherwise. Responding to a petition in the Supreme Court, being heard by five-judge bench, led by Chief Justice of India DY Chandrachud himself, the government has argued that India’s citizens do not have the 'right to know’ the identity of political donors under the electoral bonds scheme.

The SC has yet to rule on the matter, but during hearings, Chief Justice Chandrachud has already aired his misgivings. He has indicated that the ‘need for transparency’ is not being addressed. He has also said that electoral bonds should not ‘become a legitimisation of quid pro quo between power centres.. and people (the ‘unknown’ donors) who are.. benefactors of that power.’ He said there may be a need to ‘design another system which does not have the flaws of this system’.

It’s also worth noting that 92.6 percent of the electoral bonds sold are of the highest Rs 1 crore denomination, while 7.1 percent are of the Rs 10 lakh denomination.

No donor buys the lowest Rs 1,000 bond. This clearly indicates that there are entities with deep pockets that buy these bonds and donate to political parties. It would be naïve to assume that these donors expect nothing in return. So, at the very least, shouldn’t ordinary voters know who these people are?


Tracking Electoral Bonds With Hidden UIDs 

Justice Khanna, who is part of the SC’s five-judge bench on the matter, was quite direct in his observation – ‘Your contention that voters do not have the right to know… is slightly difficult to accept’.

What’s ironic is that while introducing the concept of electoral bonds, the then Finance Minister, the late Arun Jaitley, claimed that it would be a system of anonymous political donations and that since donors would buy the bonds from the State Bank of India, it would reduce the role of ‘black money’ and cash in election funding.

Unfortunately, the claims above were shown to be untrue in 2018 itself. An investigation conducted by The Quint, in which two electoral bonds worth Rs 1,000 each were purchased by our reporter Poonam Agarwal, came up with a damning revelation.

It emerged that every Electoral Bond had a 'hidden’ Unique Number, that was visible only under ultra-violet light. This meant that the bank could track the name of the donor via these hidden unique numbers.

The ruling BJP may have envisaged itself as the biggest beneficiary of the electoral bonds system.

Tracing hidden unique numbers on electoral bonds by placing them under ultra-violet light. 

(Photo: The Quint)

The Quint also showed that the State Bank of India, the only bank authorised to issue electoral bonds, was told by the Finance Ministry to make a note of these numbers. It emerged that SBI was also obliged to share donor details with enforcement agencies if needed. This led to a second damning revelation – that the government could access the identity of the donors.

The ruling BJP may have envisaged itself as the biggest beneficiary of the electoral bonds system.

Finance Ministry's instruction to SBI to make a note of the hidden numbers. 

(Photo: The Quint)

The Quint also found out that both the Reserve Bank of India and the Election Commission had raised formal objections to various aspects of the electoral bonds scheme. You can read about them here and here.

Is BJP the Biggest Beneficiary of the Electoral Bonds Scheme?

The question is, why did the Modi government ignore these objections? The answer could be that the ruling party may have envisaged itself as the biggest beneficiary of the electoral bonds system, and so, pushed it through. The numbers bear out that the BJP was by far, the biggest beneficiary.

These revelations have serious implications. First, the BJP may well know the names of those who had donated money to it, lending credibility to Justice Chandrachud’s fear of ‘quid pro quo’ deals being struck between the BJP and its donors.

Imagine a mining company seeking mining rights in a district, being objected to by local residents on environmental grounds. Could a political donation of several crores from the mining company swing matters in their favour? Yes, it could. Can the local residents donate crores? No. So, the mining baron has 'One Vote + One Crore’, while the local resident has only ‘One Vote’. Is that what our Constitution envisaged as ‘fair’ elections? No.

The second implication is that the ruling party, at present the BJP, can also access the identities of those making political donations to Opposition parties as well. That could well intimidate many well-meaning donors. And it seems to have worked. Look at the amounts collected by Opposition parties as electoral bonds – they compare poorly against the BJP’s donations.

And this brings us back to our original question. Yeh Jo India Hai Na, here, if the Bank knows, and the Sarkar knows, and the BJP knows who buys Electoral Bonds, then why not the VOTER?

What is democracy without transparency?

(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)

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Topics:  Corruption    Supreme Court   SEBI 

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