In recent years the Indian political scene is being shaken by a series of intriguing issues or events. Of these, a conspicuous one is the scheme of electoral bonds. The scheme was planned with the last Loksabha election in view. And quite expectedly it paid the overwhelmingly greatest dividend to the BJP, the ruling party, which introduced the scheme in the 2017 Budget. The other parties in the fray had to remain content with crumbs. They cried hoarse against the scheme now and then, but did not come out in strident vocal opposition when it was passed in the Loksabha as part of the Finance Bill to avoid the Rajya Sabha route. In any case, the annual audit report for the financial year 2017-18 from the greatest beneficiary, the BJP, has revealed that in March 2018 the party received 95% of the total electoral bond political donations. Of bonds worth Rs 228 crore sold in March 2018, the BJP received Rs 210 crore. Subsequntly as report goes, both the figures crossed the mark of thousands of crores. It thus proved BJP the most-favoured, the most trusted subservient party of the corporate, the monopolists and their cohorts, at present.
Besides funding through electoral bonds, the vote-oriented political parties also received corporate donations through Trusts created by the industrial houses for the purpose during the rule of the Congress-led UPA government. As per submitted reports to the Election Commission, here too the BJP received the largest donations worth Rs 473 crore during 2018-19. 75% of this amount was from the Tata group’s Progressive Electoral Trust.
Electoral Bonds
Let’s come to what these electoral bonds are. Mooted in the 2016-2017 Budget speech, the BJP-led Union government notified the Electoral Bond Scheme 2018 on 2 January 2018. Only the State Bank of India (SBI) issue these bonds against KYC (Know Your Customer) details of the buyers. So the SBI knew who bought the bonds. From SBI, the Reserve Bank of India (RBI) could get hold of the information in no time. From the RBI, with equivalent ease, matching the serial number of the bond with the KYC details, the finance ministry of the union government, which also means the political party in power, could come to know who had bought bonds of what worth. The latter, the party-in-power, could then exert and had certainly exerted pressure through various means, not least enforcement agencies, on the buyer of electoral bonds to donate the bonds to itself and not to others, particularly the opposition parties. Thus the electoral bond scheme is nothing but a means to get favour channelized to the ruling party of the day. Or else it could be that the corporates purchased the bonds mostly for funding the party-in-power anyway while others also received a bit. It is also for this reason that no vote-oriented political party really opposed the Electoral Bonds legislation in Parliament. After all, they all aspire to ride to power by currying favour with and being funded adequately by the corporate houses some day or other.
There is more to say on electoral bonds. Around 97 per cent of the bonds purchased so far were in denominations of Rs 10 lakh and Rs 1 crore with no demand for bonds of smaller denominations. It then means that only the super-rich, the corporate behemoths owned by the monopolists could afford to buy these bonds. A central issue is whether a winning candidate or party receiving so huge donations from one or more corporate houses will work for the donors or for the common people. With such high-valued bonds changing hands, if a big corporate house donates a huge amount of money to a particular political party, will it just be a charity or with strings attached? Will not that corporate house expect that on coming to power, the political party will look after its interest, write and rewrite the rules, as and when necessary, to the benefit of that house?
Transparency and anonymity
It is being argued by the ruling circle that the corporate house will remain an anonymous donor and hence the question of transparency about its identity does not arise. Is it so or just the reverse? Rather, such anonymous donors whose identity would anyway be known to the recipient party, (though not to the public) would expect quid pro quo, in the form of contracts, licences, loans, waivers, special favours, even revision of rules etc., to buttress their business interests. “Electoral Bonds will make the whole system quite opaque and will create vulnerabilities in campaign finances (donations), making the democratic system vulnerable to manipulation”, opined a former Chief Election Commissioner of India. (Bloomberg Quint 22-03-19)
Thus the BJP-led union government’s claim while introducing these bonds, that these would ensure maintaining transparency in political funding through donations, by keeping the identity of donors anonymous, is clearly a hoax. We have just seen what this so called transparency and anonymity boil down to in reality. Transparency implies that everything is open to people for their knowledge-scrutiny and judgement. Here, rather the fact behind this ridiculous claim is just the opposite. It was claimed that anonymity would protect donors from harassment from law enforcement agencies — police, the Central Bureau of Investigation, the Intelligence Bureau, the Enforcement Directorate and so on. The claim is complete bogus. Such harassment can only come through the party-in-power! As shown above, the latter can easily take care of the list of donors via the SBI- RBI-Finance Ministry route and put pressure on them be it directly or precisely through the law enforcement agencies! Even the RBI could not but admit that the BJP will be able to ‘extort’ from various corporates using the threat of unleashing ‘ICE’ (the IT Department, the CBI and the ED) on them. So, has anyone heard anywhere in the world that transparency and anonymity be considered synonymous?
Anonymity serves the donors and the donee
Anonymity serves the donors, too, with a lucrative situation before them. One major claim among those made by the government was that the electoral bonds would prevent black money from entering the election scene. This is another bogus claim. Remaining anonymous, the donors could channelize any amount of their unaccounted money into the bond-fund. For the BJP, the manufacturer of this clever scheme, there are multiple benefits. Of late, gone is its boastful claim for unearthing black money. Rather, instead of putting a check on black money, the electoral bonds scheme is a cunning ploy for allowing the donors to use their black money for reaping commercial and political advantage. Black money is only made white through these bonds. Also the donee, the party receiving such hefty sums can use it for any ‘greater’ cause like alluring the voters with freebies or for simply bribing them. Or else these can be used, as and when required to purchase elected representatives of other parties freely. The list is endless. The singular fact is that this black money funnelled through electoral bonds is used for anointing parliamentary parties simply by way of purchasing their loyalty to the donors. Thus, these vote-oriented parties virtually sell themselves to the holders of black money for enjoying pelf and power and return favours by making their governments pliant to the dictates and wishes of the donors.
Only people stand losers
So it is money and money everywhere in hundreds and thousands of crores ! As even the bourgeois columnists could not but admit, in the 21st century money plays an increasingly larger role in elections, while having no money is guaranteeing defeat. And this time the ruling party, the BJP, carefully designed a process by which a large chunk of this money can be pipelined through electoral bonds. As said above, there is no transparency. The donors remain anonymous, yet money floats in surges. It is the common people who are the losers in more ways than one. First shattered by the ruthless capitalist exploitation and oppression, they are dragged into elections. There too, they totally remain in the dark about the process going on underneath this money changing hands, about who donates to which party and wherefrom the huge amount of money being spent in elections is coming. Holding brief for the government, the Attorney General audaciously asserted that “the public has no right to know who funds political parties, as long as the funding is legitimate.” (Hindustan Times-13-04-19) Thus greed, fraudulence, cunning scheming behind the electoral bonds are topped up with arrogance as well.
The entire electoral bonds scheme thus fits the ruling monopolists, the corporate barons and the ruling bourgeois party or parties, till the time it earns palpable unpopularity as to lose the favour of the ruling class. It simply turns the bourgeois parliamentary election system once acclaimed as truly representing the will of the people, or the system “of the people, by the people, for the people”, to become a system “ of the corporates, by the corporates and for the corporates.” And in the blinding media glare the unaware, unheeded, uncared for masses, stand as people befooled by the high-tech and liberally cash-lubricated election machinery which untiringly tries to blow the wind in favour of this or that party of the ruling monopolists’ choice in order to drag people into that vortex.
It really is not difficult to realize that the corporate control over parliamentary elections is a universal phenomenon in this decadent stage of the world capitalist-imperialist system. One well-known example among many, is the case of American politicians voting against gun regulation reportedly having been funded by the National Rifle Association of the USA. But still no other country could invent such an obnoxious scheme as the electoral bond scheme in India.
Even sections of establishment were critical
So retrograde and dangerous is the scheme that even quarters of establishment could not but criticize it. A number of former chief election commissioners, the RBI officials and economists and columnists, have unambiguously spelt out that the scheme would reduce transparency instead of increasing it. They clearly pointed out that it was important to reveal to the public the source of the political donations in a democratic system so as to keep a check on the fund routed in electoral arena. In fact the Election Commission of India (ECI) and the RBI had expressed reservations about the Electoral Bonds in 2017 only. Objections were overruled and the scheme was passed in the Lok Sabha as part of the Finance Bill (as mentioned) so that it did not have to go through the Rajya Sabha where the then BJP government lacked a majority. This was the unique process through which a scheme was introduced which has no parallel in the world.
Technically speaking, the electoral bond, as conceived and issued, is a bearer instrument. A buyer gets it from the SBI and deposits it to the political party of his or her choice. Money flows from the SBI to the donee, the political party. This goes against the RBI’s sole authority to issue bearer instruments in the country. So the RBI had to write to the government that “Bearer instruments have the potential to become currency and if issued in sizable quantities can undermine the faith in banknotes issued by the central bank.” As the EC warned even foreign money could get into the scene by this route. To smoothen the process, the government amended Section 31 of the RBI Act, which, the said RBI letter pointed out, “would seriously undermine a core principle of central banking legislation and doing so would set a bad precedent”. (The Telegraph 19-11-2019) This is unthinkable even in many capitalist countries.
To help bring in the electoral bonds, the government had made changes, that is amended, the Income Tax Act, Finance Acts of 2016 and 2017, the Representation of the People Act (RPA), 1951, and the Companies Act. Even the ECI, which acted virtually as an appendage of the government in the last election, did have no option but to write to the union government in May 2017 about the dangerous consequences of the amendments as ‘serious repercussions/impact on the transparency aspect of political finance/funding of political parties’. (Frontline-10-05-2019)
The ECI also criticised the move for removing the cap of 7.5% of net profit in the preceding three financial years for companies to donate to political parties. With the 7.5% limit and the disclosure requirement removed, it was perfectly possible for any dubious entity to set up a company, or a shell company, and route money to political parties remaining completely unknown to anyone except the State Bank of India. There was relaxation in other regulations too such as revealing donations in corporate profit and loss statements etc.
Here it must be placed that our Party, SUCI(C) in its analysis of the Budget proposal of the Union government on the pages of the Proletarian Era, 1 March 2017 raised the issue. There we brought into focus that the claim of bringing “greater transparency and accountability in political funding, while preventing future generation of black money” through measures like electoral bonds was nothing but a hoax. Our apprehension is corroborated now.
Electoral bonds burial of last vestiges of democracy
The entire issue of electoral bonds then boils down to the following. A carefully designed scheme is manufactured by the BJP since 2017 to help the monopolists freely donate to the party of their choice and the favoured, subservient party to sail through the election process standing upon the solid foundation of funds. For the purpose vital laws and Acts are amended even ignoring objections and criticisms from different quarters of the bourgeois state machinery. Ultimately the electoral bond scheme was produced and used as the latest unique design to decorate the bourgeois parliamentary election. It simply brings out the rickety skeleton of parliamentary democracy and tends to put the last nail into the coffin of any kind of democratic norms and values which may still be found as vestiges even here and there in the capitalist world.
