By Parth Gupta
A Delhi-based think tank known as the Association for Democratic Reforms (ADR) came out with a report on August 17th inspecting the donation made to various political parties between the fiscal years (FY) 2012-13 to 2015-16. Five national political parties considered for the report: the Bharatiya Janata Party (BJP), Congress, Nationalist Congress Party (NCP), Communist Party of India (CPI), and the Communist Party of India (Marxist) (CPM). The Mayawati-led Bahujan Samaj Party (BSP) was not considered for this report despite being a national party as it did not pocket any voluntary contributions above Rs. 20,000 from any donor between those years.
Donation data
ADR, which works towards political transparency, revealed that these national political parties received a total of Rs. 1,070.68 crore between FY 13 and FY 16 via voluntary contributions above 20,000, out of which 89% or Rs. 956.77 crore were from corporate/business houses. The data accessed by ADR is declared by the political parties themselves, as they are mandated by the Election Commission to do so. According to these reports, the BJP received the maximum corporate donations of Rs. 705.81 crore from 2,987 donors, followed by the Congress which received Rs. 198.16 crore from 167 corporate donors. The NCP got Rs. 50.73 crore from 40 donors while the CPI and CPM had the lowest share of corporate donations at 4% and 17%, respectively.
Electoral trusts
The role of the electoral trusts in such donations becomes pressing. They have become visible as chief sources of political funding by corporations and act as a mediator between the funder and the receiver; this knocks out direct contact between the corporates and the political parties. Satya Electoral Trust was the highest donor to BJP, INC and NCP between FY13 and FY16, giving Rs. 193.63 crore to BJP, Rs. 57.25 crore to INC and Rs. 10 crores to the NCP. General Electoral Trustwhich was formed before the Electoral Scheme was launched by the government in 2013was the second-highest corporate donor to BJP and INC. Between FY 2013 and FY 16, the Trust donated Rs. 70.7 crore and Rs. 54.1 to the two National Parties, respectively. Other donors recognised in the report were: Lodha Construction (which donated Rs. 16 crores to BJP), Progressive Electoral Trust (which donated Rs. 9.9 crores to the INC), and Lodha Dwellers Pvt. Ltd. (which donated Rs. 5 crore to the NCP).
Out of all the donations, a total of 1,933 donations worth Rs. 384.04 crore lacked PAN details, whereas 1,546 donations didnt have address details in the contribution form. 99% of the donations without both PAN details and address details belonged to the BJP, amounting to Rs. 159.59 crore.
Transparency?
Increasing transparency in the process of political donations has been a long time debate, but this summer, the central government very skillfully framed the non-money related clauses in a money bill to avoid a debate in the Rajya Sabha. Among the various amendments, one was related to political donations. The amendments introduced and subsequently pushed by the BJP government essentially makes political donations easier for corporates. Previously, companies were allowed to contribute up to 7.5 percent of the average of its net profits in the last three years to political parties and were required to disclose the same in their accounts. However, the amendments to the Finance Bill 2017 propose to remove the 7.5% limit and the requirement to disclose the name of the political party to which a contribution has been made.
Electoral bonds system
Under the newly introduced system of electoral bonds, any company can transfer large sums of money to any political parties through electronic means and maintain anonymity, where the general public remains unaware as to which company is influencing which political group/ideology and to what degree. While in the Finance Bill 2017, the limit of anonymous cash donations has been reduced from Rs. 20,000 to Rs. 2,000, there exists no cap on the total amount of anonymous cash donations. The parties can simply claim they got multiple donations of Rs. 2,000 instead of a lump sum.
According to Stockholm-based International Institute for Democracy and Electoral Assistance (IDEA), India is among a mere 10% of the countries in the world that still allows political parties or candidates to receive anonymous donations. While various parties have supported the ban on corporate donations, as suggested by the Election Commission draft outcome paper on its recent consultations on political financing, the ruling BJP and the opposition Congresswho differ on almost all mattershave come together in support of political donations.
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