Investing in India’s political funding measures, the Central Government introduced Electoral Bonds in 2018. Issued by the State Bank of India (SBI) in denominations ranging from Rs. 1,000 to Rs. 1 crore, these bonds are valid for fifteen days from the issue date and can only be redeemed by a registered political party. Open for purchase by any Indian citizen during specified ten-day periods in January, April, July, and October, the bonds can either be purchased individually or jointly with other individuals. Importantly, donor anonymity is maintained as the donor’s name isn’t mentioned on the bond, and those who contribute less than Rs. 20,000 need not provide identity details.
Electoral bonds were conceived as a method to imbibe transparency in electoral financing. The government labelled the scheme an “electoral reform,” aligning with the country’s shift towards a “cashless-digital economy”.
Criticism Surrounding Electoral Bonds
Despite their intention, electoral bonds have attracted significant criticism. Critics argue that the scheme contradicts its basic premise of introducing transparency into election funding. They suggest that the bonds’ anonymity benefit mainly the governing party and the general public, including opposition parties, remain uninformed.
Possibility and Implications of Extortion
Concerns regarding potential extortion arise due to the involvement of a government-owned bank in the selling of electoral bonds. This access allows the ruling government to monitor who is funding its opponents, opening avenues for potential extortions from big companies or punitive actions against those not supporting the ruling party.
Impact on Democratic Principles
The Union government, through an amendment to the Finance Act 2017, exempted political parties from disclosing donations received via electoral bonds. This means voters remain unaware of the source and extent of funding for different parties. Critics point out this as a blow to democracy, as citizens aren’t fully informed about their representatives’ financial sources.
Compromise on Citizens’ Right to Know
The implementation of electoral bonds poses a challenge to citizens’ “right to know” – a right that the Indian Supreme Court sees as integral to freedom of expression under the Indian Constitution. The government’s ability to access donor details from SBI disrupts this right and potentially hampers free and fair elections.
Charges of Crony Capitalism
With the removal of donation limits, the electoral bonds scheme has opened doors for well-resourced corporations to fund elections without restrictions. Critics argue this has laid the groundwork for crony capitalism, characterised by mutually beneficial relationships between businesses and government officials.
Future Prospects and Reforms
The road ahead requires effective regulation of political financing coupled with bold reforms to tackle corruption and improve democratic quality. It’s also crucial to fix the current loopholes in laws to enhance accountability and transparency in governance. Furthermore, voter awareness campaigns and rejection of candidates or parties involved in overspending or bribery can ensure improvements in the democratic process.