Political Economy

Electoral Bonds Worth Over Rs 3,600 Crore Sold in March, April 2019: RTI Response

SBI said that bonds worth Rs 1,365.69 crore were sold in March 2019. In April, sales shot up by 65% in, with bonds worth Rs 2,256.37 crore being purchased.

New Delhi: Electoral bonds worth over Rs 3,500 crore were sold to the donors of India’s political parties in just the last two months, a right to information (RTI) response from the State Bank of India (SBI) has noted.

The public sector bank, which is the only entity authorised to sell the financial instruments in the country, has said that bonds worth Rs 1,365.69 crore were sold in March 2019.

Sales then shot up by 65% in April 2019, with bonds worth Rs 2,256.37 crore being purchased, making it a total  Rs of 3,622 crore.

This data comes from a RTI application filed by Pune-based activist Vihar Durve.

According to the response, SBI’s Kolkata branch sold bonds worth the most money (Rs 417.31 crore), followed by its New Delhi office (408.62 crore).

The electoral bond scheme – which was introduced by the NDA-II government from January 2018,  and purportedly aimed at improving transparency and cleaning up black money – has been criticised by the Election Commission and a range of non-governmental organisations.

Also read: Why Jaitley’s Defence of Electoral Bonds Doesn’t Hold Water

The bonds themselves are similar to mobile phone recharge coupons. They are bought by a donor, who can be either a company or a person, and are then given to a political party which must encash it within 15 days.

Critics, however, have pointed out that because the bond doesn’t carry the name of the buyer or the payee – indeed this information is supposed to be confidential under the contours of this scheme –  it actually results in the campaign financing system becoming more opaque.

In 2018, the ruling Bharatiya Janata Party was recorded as having been the biggest beneficiary of the scheme – over Rs 220 crore in bonds that were purchased as of March 2018 went to the right-wing saffron party.

The Wire’s in-depth examination of the bond scheme has also shown how it hasn’t resulted in greater transparency: In FY 2017-2018, the BJP’s income from hidden sources was Rs 553.38 crore, more than half of its country-wide collections.

A clutch of petitioners, including the Association for Democratic Reforms (ADR), have filed an application in the Supreme Court, seeking a stay on the sale of electoral bonds.

The legal challenge before the apex court contends that the Modi government’s legislative changes to campaign financing have “opened the floodgates to unlimited corporate donations to political parties and anonymous financing by Indian as well as foreign companies which can have serious repercussions on the Indian democracy”.

Also read: Finance Ministry ‘Misled’ Parliament About Electoral Bonds

The government on its part has defended the scheme, saying that the bonds have digitised and brought order to the earlier haphazard method of funding political parties in India.

During the hearings, attorney general K.K Venugopal drew criticism when he stated that it was not the “voter’s concern” to “know where the money comes from”.

“Transparency cannot be looked as a mantra. What is the realities of the country. This is a scheme that will eliminate black money from the election,” Venugopal was quoted as saying.

In April 2019, the court declined to order an interim stay, saying that a more detailed hearing was required. It, however, ordered that details of donors be furnished in a sealed envelope to itself and the Election Commission by May 30.

(With inputs from PTI)