National Herald
Nitya Chakraborty

Electoral Bonds scheme institutionalises a unique system of quid pro quo between Indian business world and the government never seen before in India’s history since independence

The 21st tranche of Electoral Bonds (EBs) is on sale from July 1-10 this year, following the last edition held for ten days from April 1-10. Chief Justice of India N V Ramana had indicated at the time that the Supreme Court would be taking up the pending petition challenging the EB scheme which has been in limbo. However, even three months after this assurance, the petition has not been taken up.

Meanwhile, the bonds continue to fill the coffers of the ruling party, the BJP, further boosting its financial heft which, as is well-known, helps fuel its mega election campaigns and perhaps even comes handy in toppling democratically elected governments such as the one in Maharashtra recently by luring away MLAs.

Most of the major recognized national and state parties have submitted their ‘Annual Audit Reports’ for the year 2020-21. Data from 2017-18 indicates that the number of EBs purchased and redeemed was the lowest in 2020-21. While three regional parties – YSRCP, DMK & BJD –accounted for 75 percent of the EBs redeemed in 2020-21, the BJP retained its position as the largest beneficiary with 65 percent EBs redeemed till 2020-21. The total amount received by the BJP would be around Rs. 6900 crore during this period.

As per information received from State Bank of India (SBI) in response to an RTI application, a total of 811 EBs worth Rs. 648.49 crore were sold during the 20th Phase i.e., between April 1 and April 10, 2022; all the EBs purchased were redeemed. This was about 53 per cent of the EBs sold in the immediately preceding phase in January 2022 when EBs worth Rs. 1.21 thousand crore were sold by SBI during the 19th phase.

The 19th phase of sale was prior to the Assembly elections held in five states during February-March 2022, including the key state of Uttar Pradesh. Now, the next Assembly elections are scheduled by the end of 2022 and before that another tranche of bonds may well be released for sale.

Out of the 811 EBs purchased in the latest phase, 640 EBs i.e., 79 percent of the total bonds, were of Rs. 1 crore denomination. Comparatively, the share of EBs of Rs 1 crore denomination bonds in the 19th Phase were 56 percent.

In line with the earlier trends, EBs of lower value have a lower share. During the 20th phase, 79 EBs of Rs. 10 lakh, 55 of Rs. 1 lakh and 37 EBs of Rs.10000 denomination were purchased.

Earlier, on March 24 last year, the Supreme Court in its hearing on the Electoral Bonds petition expressed concern about the misuse of EBs, but dismissed a plea by Association of Democratic Rights (ADR) to stay fresh sale of the EBs. As a result, the sale of EBs continued and the BJP went on to mobilise huge funds in the run up to the Assembly elections to the five states held in February/March 2022.

The important point which the learned judges, especially the then CJI S A Bobde, missed in the 2021 hearing was that the EB issue is a part of the BJP government's systematic efforts since coming to power in 2014 to steamroll the opposition parties through sheer financial muscle and thereby ensure its continued governance through funding by the big corporates.

In the process, a unique system of quid pro quo has been institutionalised in the Indian business world which has never been seen in this country's history since independence.

The functioning of democracy in the states in India as also at the Centre is under threat due to this brazen show of money power. The level playing field has been lost for the non-BJP parties. BJP has garnered huge resources through corporate donations, active support of the big traders and the big funds supply by overseas Indians close to the BJP as also the VHP-dominated overseas religious bodies.

The use of Central agencies like ED, CBI and the IT department has been so blatant that no corporate takes any risk to be involved with the Congress, the main opposition party in the country.

The Electoral Bonds can be purchased by corporates, but the names remain known only to the issuer, i.e. the State Bank of India and not the Election Commission. This means the names will be known to the Central government, and thus, those who remitted some funds to opposition parties are likely to be blacklisted.

While most big corporates houses tend to side with the ruling party, many of them also sense the decline in democratic values in the country and like to fund non-BJP parties to keep the playing field level. But with the EB scheme, such an arrangement becomes increasingly risky for the businessmen in question.

Nobody will take the risk of doing such transactions in favour of any opposition party since it will be known to the Union Finance Ministry through SBI. The EB scheme is, thus, a clear and present danger to Indian democracy.

Attorney General KK Venugopal in last year’s hearing presented a misleading picture in reply to the CJI’s query when he said that the EBs have ensured white money, not black money through cash. The issue is really not that; the issue is transparency.

Why should the Central government and through that the ruling party be pricy to the information about who has bought the bonds and in whose favour? Further, EBs can be repurchased, which opens up the possibility of dubious transactions, a double benefit for the ruling party.

Recently, in a public address at San Francisco, CJI Ramana said that the apex judiciary of the country is bound to the Constitution and the Constitution only. That is the right spirit which should guide the Supreme Court to hear the pending petition early so that the ruling party is unable to take undue advantage by subverting the process of democracy by tweaking laws and procedures in its favour.

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