Last Monday, the State Bank of India sparked considerable debate following its request for additional time to comply with the Supreme Court’s directive striking down the scheme as unconstitutional, mandating the immediate discontinuation of the issuance of these bonds and disclosing details of all bond transactions since April 2019.
The apex court’s order sought a detailed account of the electoral bond transactions, after the petition against the Electoral Bonds Scheme was filed by the Association for Democratic Reforms (ADR). The move aims to peel back layers of invisibility covering political contributions.
Introduced in 2018, Electoral Bonds were designed to be an anonymous method for making political donations. These bonds, which function like agreement notes, are available for purchase by Indian citizens or companies in denominations ranging from ₹1,000 to ₹1,00,00,000 at designated SBI branches. To encash these bonds, any political parties that are beneficiaries must be registered under the Representation of the Peoples Act, 1951, and have at least 1% of the votes in the most recent national or state elections.
The total value of Electoral Bonds purchased from SBI is about ₹16,518 crores to date. A substantial number of these, over 18,000 bonds worth over ₹9,800 crore, were sold by SBI in 20 allotments as of April 2022.
The total number of electoral bonds issued between April 12, 2019, and February 15, 2024, stands at 22,217. It is important to note that there is no cap on the number of electoral bonds that an individual or company can purchase.
The Bharatiya Janata Party (BJP) has been the predominant beneficiary of this scheme, receiving nearly 90% of the corporate donations made through electoral bonds. The Congress party, as a sig
According to the declarations to the Election Commission, the Congress received ₹1,123 crore through electoral bonds from 2017-18 to 2022-23. The Aam Aadmi Party (AAP), which has gained prominence in Delhi and Punjab and became a national party in April 23, declared receiving contributions of ₹94 crore over the years in the category of “electoral bond/electoral trust”. However, it is not clear how much of this amount is specifically from electoral bonds alone.
The Supreme Court’s directive, ordering the State Bank of India to disclose comprehensive details of the bonds to the Election Commission, was seen as a step towards greater transparency. Specific companies that have made donations through electoral bonds have not been disclosed publicly as of now. However, the bank’s plea for an extension till June 30, 2024, citing the violation of data and logistical hurdles, has stirred political complications.
Opposition parties have taken this issue as an opportunity to voice their concerns over the murkiness of the scheme, alleging that it paves the way for unchecked, anonymous donations that could cut or turn the democratic process. They have also urged the scheme’s cancellation, recommending for reforms that promise more transparency and accountability in political funding. S. Y. Quraishi, ex-Chief Election Commissioner of India and the man who filed the petition for ADR, criticized the Electoral Bonds Scheme for opacity and risks to democracy. He lauded the Supreme Court’s voiding of the scheme, affirming it as a win for transparency in political funding.
In the list of national parties, the Communist Party of India (Marxist), stands as an exception, having declined to accept Electoral Bonds in favor of a more transparent funding model.
The Supreme Court, in its judgment, expressed concerns over the potential for “quid pro quo” arrangements facilitated by the anonymity of electoral bonds, which could result in favorable policy changes and government licenses. As the discussion around electoral bonds continues to evolve, the nation’s attention is fixed on the players affected by the Supreme Court’s verdict. The outcome of this legal battle could redefine the shape of political funding in India, potentially setting an example for future electoral finance reforms.
