{"id":4088,"date":"2026-05-10T06:14:50","date_gmt":"2026-05-10T06:14:50","guid":{"rendered":"https:\/\/untoldpages.in\/?p=4088"},"modified":"2026-05-10T06:14:50","modified_gmt":"2026-05-10T06:14:50","slug":"political-funding-after-electoral-bonds","status":"publish","type":"post","link":"https:\/\/untoldpages.in\/?p=4088","title":{"rendered":"POLITICAL FUNDING AFTER ELECTORAL BONDS"},"content":{"rendered":"

TOPIC 19<\/span><\/h1>\n

Transparency Concerns Surrounding Anonymous Political Financing<\/span><\/h2>\n
\n

In February 2024, India\u2018s Supreme Court struck down the Electoral Bond Scheme, calling it \u201cunconstitutional\u201d and a violation of citizens\u2019 right to know\u00a0<\/span>. The scheme, which had allowed unlimited anonymous donations to political parties for nearly six years, was a \u201cturning point\u201d that \u201cinstitutionalized opacity\u201d\u00a0<\/span>. But the striking down of the scheme did not end the controversy. It only changed its form.<\/span><\/strong><\/p>\n

Even as the court delivered its verdict, the Ministry of Finance ordered the printing of 8,350 new electoral bonds\u2014after the scheme had been declared unconstitutional\u00a0<\/span>. The State Bank of India (SBI) defied the Supreme Court\u2018s order to disclose donor data, forcing a contempt petition\u00a0<\/span>. And when the data finally emerged, it revealed that over 50% of all electoral bond donations\u2014\u20b98,252 crore out of \u20b916,492 crore\u2014had gone to a single party: the Bharatiya Janata Party (BJP)\u00a0<\/span>.<\/span><\/strong><\/p>\n

The scheme is gone. But the loopholes remain. The Companies Act still allows corporate donations without naming the beneficiary party\u00a0<\/span>. Electoral trusts\u2014opaque intermediaries\u2014have surged in prominence, with \u20b93,811 crore flowing through them in 2024-25 alone, 82% of it to the BJP\u00a0<\/span>. And political parties still hide the majority of their income under \u201cvoluntary contributions\u201d and \u201csale of coupons\u201d\u2014sources that reveal nothing about the donor\u2018s identity\u00a0<\/span>. As the ADR\u2019s 2026 report warns: \u201cThere is no dearth of solutions. What is required is courage and will to reform the existing system\u201d\u00a0<\/span>.<\/span><\/strong><\/p>\n

This article examines the electoral bonds scandal, the loopholes that survived the Supreme Court\u2018s verdict, and the transparency crisis that continues to haunt Indian democracy.<\/span><\/strong><\/p>\n<\/blockquote>\n

WHAT<\/span><\/strong>\u00a0\u2013 The Electoral Bond Scheme (2018-2024) allowed individuals and companies to donate unlimited, anonymous funds to political parties through special bonds purchased from the State Bank of India. Struck down by the Supreme Court in February 2024, the scheme\u2018s legacy\u2014and the structural loopholes that enabled it\u2014continue to shape political funding.<\/span><\/p>\n

WHO<\/span><\/strong>\u00a0\u2013 The BJP (which received over 50% of all electoral bond funds), opposition parties (which received significantly less), corporate donors (including loss-making and shell companies), the State Bank of India (which administered the scheme and defied court orders), the Supreme Court (which struck down the scheme), and the Association for Democratic Reforms (ADR, which has tracked political funding for two decades).<\/span><\/p>\n

WHEN<\/span><\/strong>\u00a0\u2013 Scheme introduced in 2017, first bonds sold in 2018; struck down by Supreme Court on February 15, 2024; data disclosed in March 2024 after contempt proceedings; ongoing transparency concerns in 2025-2026.<\/span><\/p>\n

WHERE<\/span><\/strong>\u00a0\u2013 Across India, affecting all political parties and electoral processes nationally.<\/span><\/p>\n

WHY<\/span><\/strong>\u00a0\u2013 Officially, to bring \u201cclean money\u201d into politics and reduce cash donations. Critics argue the scheme legalized corruption, allowed unlimited corporate influence, and created a quid pro quo economy where donors received favorable policies, contracts, or relief from enforcement agencies in exchange for donations.<\/span><\/p>\n

HOW<\/span><\/strong>\u00a0\u2013 Through anonymous bonds purchasable by anyone; through amendments to the Companies Act removing caps on corporate donations; through electoral trusts that channel funds while obscuring ultimate beneficiaries; and through the \u201cvoluntary contribution\u201d loophole that allows parties to hide donor identities.<\/span><\/p>\n

\n

SECTION 1: THE ELECTORAL BONDS SCHEME \u2013 DESIGN AND CRITIQUE<\/span><\/strong><\/p>\n

1.1 What Were Electoral Bonds?<\/span><\/strong><\/p>\n

The Electoral Bond Scheme was introduced in the Finance Bill, 2017, and implemented in 2018. The stated objective: to bring \u201cclean money\u201d into political funding and reduce the prevalence of untraceable cash donations\u00a0<\/span>.<\/span><\/p>\n

Key features of the scheme\u00a0<\/span>:<\/span><\/p>\n

\n\n\n\n\n\n\n\n\n\n\n\n
Feature<\/span><\/th>\nDetail<\/span><\/th>\n<\/tr>\n<\/thead>\n
Denominations<\/span><\/strong><\/td>\n\u20b91,000 to \u20b91 crore<\/span><\/td>\n<\/tr>\n
Purchaser<\/span><\/strong><\/td>\nAny individual or company (including loss-making companies)<\/span><\/td>\n<\/tr>\n
Vendor<\/span><\/strong><\/td>\nState Bank of India (SBI) exclusively<\/span><\/td>\n<\/tr>\n
Anonymity<\/span><\/strong><\/td>\nDonor\u2018s name not recorded on bond; party could not know donor, but SBI and government could track<\/span><\/td>\n<\/tr>\n
Tax exemption<\/span><\/strong><\/td>\nDonations tax-exempt for both donor and recipient<\/span><\/td>\n<\/tr>\n
Validity<\/span><\/strong><\/td>\n15 days; must be encashed within this period<\/span><\/td>\n<\/tr>\n
Eligible parties<\/span><\/strong><\/td>\nParties registered with Election Commission and securing at least 1% of votes in last election<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

1.2 The Government\u2019s Defense \u2013 And Its Flaws<\/span><\/strong><\/p>\n

The government, led by then Finance Minister Arun Jaitley, argued that electoral bonds would bring \u201ctransparency\u201d by channeling donations through the banking system rather than through cash\u00a0<\/span>. Jaitley claimed that anonymity was necessary to protect donors from \u201cany retribution from political parties\u201d\u00a0<\/span>.<\/span><\/p>\n

The critique that emerged:<\/span><\/strong><\/p>\n

\n\n\n\n\n\n\n\n\n
Government Claim<\/span><\/th>\nCounter-Argument<\/span><\/th>\n<\/tr>\n<\/thead>\n
\u201cBrings clean money into politics\u201d<\/span><\/td>\nThe scheme simply shifted cash donations into banking channels without addressing source; 90% of bonds were of the highest denomination (\u20b91 crore)\u00a0<\/span><\/td>\n<\/tr>\n
\u201cProtects donors from retribution\u201d<\/span><\/td>\nAnonymity also protected corrupt donors from public exposure; the scheme created a perfect vehicle for quid pro quo<\/span><\/td>\n<\/tr>\n
\u201cRouted through banks ensures traceability\u201d<\/span><\/td>\nOnly SBI and government could trace donors; voters could not. The Supreme Court held that voters\u2018 right to know overrides donor privacy<\/span><\/td>\n<\/tr>\n
\u201cPrevents foreign funding\u201d<\/span><\/td>\nAmendments to FCRA allowed foreign companies with Indian subsidiaries to fund parties\u00a0<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

1.3 The Secret Tracking Number \u2013 A Hidden Feature<\/span><\/strong><\/p>\n

A critical detail about electoral bonds was hidden from public knowledge until an investigative journalist exposed it. Poonam Agarwal purchased a bond herself and subjected it to forensic examination using ultraviolet light. She discovered that each bond carried a unique number\u2014invisible to the naked eye\u2014that could be used by authorities to track donors\u00a0<\/span>.<\/span><\/p>\n

This meant that while donors were \u201canonymous\u201d to the public and to rival parties, the government\u2014through SBI\u2014could identify them. As Common Cause\u2018s analysis notes, \u201cthe ruling party at the centre had a way of knowing\u201d\u00a0<\/span>. This created a powerful tool for political coercion: donors knew their contributions were not truly anonymous to the party in power.<\/span><\/p>\n

\n

SECTION 2: THE SUPREME COURT VERDICT \u2013 A LANDMARK JUDGMENT<\/span><\/strong><\/p>\n

2.1 The Key Holdings (February 15, 2024)<\/span><\/strong><\/p>\n

A five-judge Constitution bench of the Supreme Court, led by Chief Justice D.Y. Chandrachud, delivered a unanimous 232-page judgment striking down the Electoral Bond Scheme\u00a0<\/span>.<\/span><\/p>\n

Key holdings\u00a0<\/span>:<\/span><\/p>\n

\n\n\n\n\n\n\n\n\n
Holding<\/span><\/th>\nReasoning<\/span><\/th>\n<\/tr>\n<\/thead>\n
Violates Right to Information<\/span><\/strong><\/td>\nCitizens have a right to know who funds political parties; anonymous donations infringe on this right under Article 19(1)(a)<\/span><\/td>\n<\/tr>\n
Unlimited corporate donations violate political equality<\/span><\/strong><\/td>\nCompanies have far greater ability to influence elections than individuals; unlimited contributions undermine \u201cone person, one vote\u201d<\/span><\/td>\n<\/tr>\n
Loss-making companies donating<\/span><\/strong><\/td>\nThe court noted it was \u201cmore plausible that loss-making companies will contribute to political parties with quid pro quo\u201d\u00a0<\/span><\/td>\n<\/tr>\n
Amendment to Companies Act arbitrary<\/span><\/strong><\/td>\nRemoving the 7.5% profit cap on corporate donations violated Article 14 (Right to Equality)<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

The court declared: \u201cThe electoral bond scheme infringes upon the right of information of the voter. The information about the funding of political parties is essential for the effective exercise of the choice of voting\u201d\u00a0<\/span>.<\/span><\/p>\n

2.2 Immediate Directions<\/span><\/strong><\/p>\n

The Supreme Court ordered\u00a0<\/span>:<\/span><\/p>\n

    \n
  1. \n

    SBI to immediately stop issuing electoral bonds<\/span><\/p>\n<\/li>\n

  2. \n

    SBI to submit details of all bonds purchased since April 2019 to the Election Commission<\/span><\/p>\n<\/li>\n

  3. \n

    Election Commission to publish all details (purchaser name, bond denomination, beneficiary party) by March 13, 2024<\/span><\/p>\n<\/li>\n<\/ol>\n

    2.3 SBI\u2018s Defiance and Contempt Proceedings<\/span><\/strong><\/p>\n

    The State Bank of India did not comply promptly. It requested \u201cunreasonable time\u201d to \u201cdecipher and match\u201d datasets. Civil society petitioners\u2014the Association for Democratic Reforms (ADR) and Common Cause\u2014filed a contempt of court petition against SBI for \u201cwilful non-compliance\u201d with the court\u2018s order\u00a0<\/span>.<\/span><\/p>\n

    The Supreme Court acted firmly, ordering immediate disclosures by the next day, March 12, 2024\u00a0<\/span>.<\/span><\/p>\n

    \n

    SECTION 3: THE DATA \u2013 WHAT THE DISCLOSURES REVEALED<\/span><\/strong><\/p>\n

    3.1 Overall Figures<\/span><\/strong><\/p>\n

    Between March 2018 and January 2024, political parties redeemed electoral bonds worth over \u20b916,492 crore (approximately $1.98 billion USD)\u00a0<\/span>.<\/span><\/p>\n

    Party-wise distribution\u00a0<\/span>:<\/span><\/strong><\/p>\n

    \n\n\n\n\n\n\n\n\n
    Party<\/span><\/th>\nAmount Received (\u20b9 Cr)<\/span><\/th>\nShare of Total<\/span><\/th>\n<\/tr>\n<\/thead>\n
    BJP<\/span><\/td>\n8,252<\/span><\/td>\n50.6%<\/span><\/td>\n<\/tr>\n
    Congress<\/span><\/td>\n~1,600<\/span><\/td>\n~10%<\/span><\/td>\n<\/tr>\n
    Trinamool Congress (TMC)<\/span><\/td>\nSignificant but far lower<\/span><\/td>\n\u2014<\/span><\/td>\n<\/tr>\n
    All other parties combined<\/span><\/td>\nRemainder<\/span><\/td>\n\u2014<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

    The BJP received more than all other parties combined\u2014a staggering concentration of political funding.<\/span><\/p>\n

    3.2 Corporate Dominance<\/span><\/strong><\/p>\n

    As the ADR\u2018s 2026 report notes: \u201cBig corporations voluntarily fund political parties, especially the government in power, to essentially use their clout to shape laws, policies, regulations and contracts in their favor. This exchange between corporates and political parties comes at the cost of public interest\u201d\u00a0<\/span>.<\/span><\/p>\n

    3.3 Quid Pro Quo \u2013 The Pattern of Suspicious Donations<\/span><\/strong><\/p>\n

    When the data was made public, investigative journalists began connecting dots. The findings were damning\u00a0<\/span>:<\/span><\/p>\n

      \n
    • \n

      Shell companies<\/span><\/strong>: At least 20 donations were made by entities that were barely a few months old\u2014some only a few days old\u2014violating the Companies Act requirement of three years\u2018 existence<\/span><\/p>\n<\/li>\n

    • \n

      Loss-making companies<\/span><\/strong>: Dozens of companies with no profits made massive donations<\/span><\/p>\n<\/li>\n

    • \n

      Timing of donations<\/span><\/strong>: Many donations were made close in time to companies receiving government contracts, licenses, or regulatory clearances<\/span><\/p>\n<\/li>\n

    • \n

      Enforcement agency actions<\/span><\/strong>: At least 14 out of 30 major donors had faced raids by the Enforcement Directorate, CBI, or Income Tax authorities before making donations. The charges against them were mysteriously stalled or dropped after the donations\u00a0<\/span><\/p>\n<\/li>\n<\/ul>\n

      Opposition leaders described this as \u201chafta vasooli\u201d\u2014extortion through enforcement agencies. The Congress party alleged that \u201craids by multiple federal agencies were conducted to first target the entities and then coerce them into making donations\u201d\u00a0<\/span>.<\/span><\/p>\n

      3.4 The Two Biggest Donors \u2013 Shadowy Beneficiaries<\/span><\/strong><\/p>\n

      The largest donor was not a Fortune 500 company but a virtually unknown entity: Future Gaming and Hotel Services, which donated \u20b91,368 crore. Its owner, known as India\u2018s \u201cLottery King\u201d, went on an \u201celectoral bonds buying spree\u201d within 10 days of the central government alerting states about the company\u2018s \u201cfrauds\u201d and \u201cirregularities\u201d\u00a0<\/span>.<\/span><\/p>\n

      The second largest donor was Megha Engineering and Infrastructure Ltd, which donated \u20b9980 crore. The company was awarded government projects worth thousands of crores of rupees in roughly the same period. A CAG report found that on one of the company\u2018s projects, the original cost had escalated by 400% by the time of completion\u00a0<\/span>.<\/span><\/p>\n

      3.5 The Perpetual Loophole \u2013 Bonds Printed After the Ban<\/span><\/strong><\/p>\n

      Even after the Supreme Court declared the scheme unconstitutional, the government continued printing bonds. RTI responses revealed\u00a0<\/span>:<\/span><\/p>\n

        \n
      • \n

        On January 12, 2024 (before the verdict), the Ministry of Finance approved SBI\u2018s request to print 10,000 bonds of \u20b91 crore each<\/span><\/p>\n<\/li>\n

      • \n

        On February 21, 2024 (6 days after the verdict), the Indian Security Press printed 8,350 bonds<\/span><\/p>\n<\/li>\n

      • \n

        Only after SBI reminded the department did the Ministry order a halt to printing on February 28, 2024<\/span><\/p>\n<\/li>\n

      • \n

        The cost of printing\u2014\u20b93.72 lakh\u2014was borne by\u2026 unknown. The government has not disclosed who paid\u00a0<\/span><\/p>\n<\/li>\n<\/ul>\n

        \n

        SECTION 4: THE LOOPHOLES THAT SURVIVED \u2013 POST-BOND OPACITY<\/span><\/strong><\/p>\n

        The striking down of electoral bonds did not end the problem of anonymous political funding. Multiple structural loopholes remain.<\/span><\/p>\n

        4.1 The Companies Act Loophole \u2013 Donations Without Beneficiary Disclosure<\/span><\/strong><\/p>\n

        As Moneylife\u2018s analysis by Ranganathan V notes: \u201cUnder the present Section 182, companies making donations need not specify the beneficiary. The only requirement is to disclose the sum of the political donations made\u201d\u00a0<\/span>.<\/span><\/p>\n

        This is a critical gap. Before 2013, under Section 293A of the Companies Act, 1956, companies had to disclose both the amount and the name of the political party receiving the donation. The 2013 Act removed this requirement. The Supreme Court struck down the electoral bond scheme but did not address this underlying statutory provision.<\/span><\/p>\n

        As a result, corporate India can still donate anonymously\u2014they just cannot use electoral bonds to do so. They can donate directly through cheques, and their annual reports need only disclose the total amount, not the recipient party.<\/span><\/p>\n

        4.2 Electoral Trusts \u2013 The New Anonymity Vehicle<\/span><\/strong><\/p>\n

        Electoral trusts\u2014intermediary organizations that collect corporate donations and distribute them to parties\u2014have surged in prominence since the bond scheme was struck down\u00a0<\/span>.<\/span><\/p>\n

        Key data on electoral trusts (2024-25)\u00a0<\/span>:<\/span><\/strong><\/p>\n

        \n\n\n\n\n\n\n\n\n\n
        Metric<\/span><\/th>\nFigure<\/span><\/th>\n<\/tr>\n<\/thead>\n
        Total donations via electoral trusts<\/span><\/td>\n\u20b93,811 crore<\/span><\/td>\n<\/tr>\n
        Increase from previous year<\/span><\/td>\n3x (\u20b91,218 crore in 2023-24)<\/span><\/td>\n<\/tr>\n
        BJP\u2018s share<\/span><\/td>\n\u20b93,112 crore (82%)<\/span><\/td>\n<\/tr>\n
        Congress\u2018s share<\/span><\/td>\n\u20b9299 crore (8%)<\/span><\/td>\n<\/tr>\n
        All other parties combined<\/span><\/td>\n\u20b9400 crore (10%)<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

        Major electoral trusts and their beneficiaries\u00a0<\/span>:<\/span><\/strong><\/p>\n

        \n
        \n
        <\/div>\n<\/div>\n\n\n\n\n\n\n\n\n
        Trust<\/span><\/th>\nTotal Donated (\u20b9 Cr)<\/span><\/th>\nBeneficiaries<\/span><\/th>\n<\/tr>\n<\/thead>\n
        Prudent Electoral Trust<\/span><\/td>\n2,668<\/span><\/td>\nBJP (2,181), Congress (216), TMC (92), YSR Congress (88)<\/span><\/td>\n<\/tr>\n
        Progressive Electoral Trust (Tata Group)<\/span><\/td>\n915<\/span><\/td>\nBJP (758), Congress (77), 8 other parties (80)<\/span><\/td>\n<\/tr>\n
        New Democratic Electoral Trust (Mahindra Group)<\/span><\/td>\n160<\/span><\/td>\nBJP (150), Congress (5), Shiv Sena (UBT) (5)<\/span><\/td>\n<\/tr>\n
        Harmony Electoral Trust<\/span><\/td>\n30<\/span><\/td>\nBJP solely<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

        The shift from electoral bonds to electoral trusts is a shift in form, not substance. Trusts disclose donor identities, but not in a way that is accessible or transparent to voters. As Moneylife notes, \u201cthe name of the electoral trust means nothing to any reader of the reports\u201d\u00a0<\/span>. The ultimate corporate donors\u2014Tata, Mahindra, Kalyani, Bharat Forge\u2014are known, but the link between specific donations and specific policy outcomes remains opaque.<\/span><\/p>\n

        4.3 The \u201cVoluntary Contribution\u201d Loophole \u2013 \u201cUnknown Sources\u201d Dominance<\/span><\/strong><\/p>\n

        Even before electoral bonds, political parties hid the majority of their income under categories like \u201cvoluntary contributions,\u201d \u201csale of coupons,\u201d \u201crelief fund,\u201d \u201cmiscellaneous income,\u201d and \u201ccontribution from meetings\u201d\u00a0<\/span>.<\/span><\/p>\n

        The scale of the problem\u00a0<\/span>:<\/span><\/strong><\/p>\n

        Between 2014-15 and 2016-17 (pre-bonds), 66% of party funds came from \u201cunknown sources\u201d\u2014donors contributing less than \u20b920,000 (later reduced to \u20b92,000), whose identities did not need to be disclosed.<\/span><\/p>\n

        After bonds were introduced, disclosure of \u201cunknown sources\u201d actually increased\u2014because bonds replaced cash, not because transparency improved. In 2021-22, 60% of BJP\u2018s income was from \u201cunknown sources,\u201d of which electoral bonds accounted for 89%\u00a0<\/span>.<\/span><\/p>\n

        With bonds gone, the \u201csub-\u20b92,000 cash donation\u201d loophole returns. Parties can still receive unlimited cash donations in small amounts, aggregate them, and report them as \u201cvoluntary contributions\u201d without disclosing a single donor name.<\/span><\/p>\n

        4.4 State Capture \u2013 The 93% Millionaire Winner Statistic<\/span><\/strong><\/p>\n

        The ADR\u2018s 2026 report reveals the real-world consequence of opaque political funding\u00a0<\/span>:<\/span><\/p>\n

        \n
        \n
        <\/div>\n<\/div>\n\n\n\n\n\n\n\n
        Indicator<\/span><\/th>\n2009<\/span><\/th>\n2024<\/span><\/th>\nChange<\/span><\/th>\n<\/tr>\n<\/thead>\n
        Winners who are millionaires<\/span><\/td>\n58%<\/span><\/td>\n93%<\/span><\/td>\n+35%<\/span><\/td>\n<\/tr>\n
        Candidates with assets > \u20b91 crore<\/span><\/td>\n\u2014<\/span><\/td>\n19.6% chance of winning<\/span><\/td>\n\u2014<\/span><\/td>\n<\/tr>\n
        Candidates with assets < \u20b91 crore<\/span><\/td>\n\u2014<\/span><\/td>\n0.7% chance of winning<\/span><\/td>\n\u2014<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

        As the report notes: \u201cWealthy candidates (having criminal antecedents) are more likely to contest and win elections.\u201d In 2024, 44% of Congress candidates and 43% of BJP candidates had declared criminal cases against themselves. \u201cParties\u2019 search for rich candidates has also opened doors for criminalization of elections as a candidate with criminal antecedents is more likely to raise funds and afford the soaring costs of elections,\u201d the report states\u00a0<\/span>.<\/span><\/p>\n

        \n

        SECTION 5: THE ADR\u2018S 2026 REPORT \u2013 A COMPREHENSIVE ASSESSMENT<\/span><\/strong><\/p>\n

        The Association for Democratic Reforms, in collaboration with the University of Melbourne\u2018s Electoral Regulation Research Network, published \u201cPolitical Finance in India: Assessment and Recommendations\u201d in March 2026\u00a0<\/span>.<\/span><\/p>\n

        5.1 Key Findings<\/span><\/strong><\/p>\n

        \n
        \n
        <\/div>\n<\/div>\n\n\n\n\n\n\n\n\n\n
        Finding<\/span><\/th>\nDetail<\/span><\/th>\n<\/tr>\n<\/thead>\n
        Money dominates politics<\/span><\/strong><\/td>\nFinancial dominance has become the primary determinant of political success, not ideology or public service<\/span><\/td>\n<\/tr>\n
        Unknown sources still dominate<\/span><\/strong><\/td>\nSince 2004-05, over 64% of national party funds came from sources donors do not have to disclose<\/span><\/td>\n<\/tr>\n
        Corporate funding disparity<\/span><\/strong><\/td>\nBJP received direct corporate donations four times greater than all other national parties combined<\/span><\/td>\n<\/tr>\n
        Criminalization linked to funding<\/span><\/strong><\/td>\nParties seek rich candidates, who are more likely to have criminal antecedents<\/span><\/td>\n<\/tr>\n
        Voter inducement surge<\/span><\/strong><\/td>\nECI seized illicit items worth \u20b98,889 crore in 2024 elections\u2014155% increase over 2019<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

        5.2 Eleven Recommendations<\/span><\/strong><\/p>\n

        The ADR report calls for a complete overhaul of the political finance system\u00a0<\/span>:<\/span><\/p>\n

        \n
        \n
        <\/div>\n<\/div>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
        Recommendation<\/span><\/th>\nDetail<\/span><\/th>\n<\/tr>\n<\/thead>\n
        Comprehensive political party law<\/span><\/strong><\/td>\nRegulate finances, internal democracy, leadership accountability<\/span><\/td>\n<\/tr>\n
        Bring parties under RTI<\/span><\/strong><\/td>\nCurrent exemption shields party finances from public scrutiny<\/span><\/td>\n<\/tr>\n
        Limit private donations<\/span><\/strong><\/td>\nImpose caps; mandate full disclosure of donors<\/span><\/td>\n<\/tr>\n
        Ban anonymous and cash donations<\/span><\/strong><\/td>\nAll contributions must be through digital transactions<\/span><\/td>\n<\/tr>\n
        Strengthen EC powers<\/span><\/strong><\/td>\nAllow de-recognition\/deregistration of non-compliant parties<\/span><\/td>\n<\/tr>\n
        Public funding of polls<\/span><\/strong><\/td>\nReduce dependence on private money<\/span><\/td>\n<\/tr>\n
        CAG audit of party accounts<\/span><\/strong><\/td>\nIndependent verification of party finances<\/span><\/td>\n<\/tr>\n
        Stricter campaign expenditure limits<\/span><\/strong><\/td>\nEnforce existing caps<\/span><\/td>\n<\/tr>\n
        Align EC appointments with SC directive<\/span><\/strong><\/td>\nEnsure independence of election management<\/span><\/td>\n<\/tr>\n
        Maintain public database of sanctions<\/span><\/strong><\/td>\nTransparency on penalties for non-compliance<\/span><\/td>\n<\/tr>\n
        Define bribery as corrupt practice<\/span><\/strong><\/td>\nAddress freebies and voter inducement<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n
        \n

        \u201cThere is no dearth of solutions. What is required is courage and will to reform the existing system. The only way to remedy the existing problems in political finance is to immediately act upon the plausible solutions offered by the judiciary, constitutional bodies, committees, civil society, and citizens\u201d\u00a0<\/span>.<\/span><\/p>\n<\/blockquote>\n

        \n

        SECTION 6: COMPARATIVE ANALYSIS \u2013 INDIA VS. OTHER DEMOCRACIES<\/span><\/strong><\/p>\n

        \n
        \n
        <\/div>\n<\/div>\n\n\n\n\n\n\n\n\n\n
        Country<\/span><\/th>\nDonation Disclosure Threshold<\/span><\/th>\nCorporate Donations<\/span><\/th>\nPublic Funding<\/span><\/th>\n<\/tr>\n<\/thead>\n
        India<\/span><\/strong><\/td>\n\u20b920,000 (~$240) \u2013 no disclosure below; corporate donations unlimited<\/span><\/td>\nUnlimited; no beneficiary disclosure required<\/span><\/td>\nMinimal via NCEP<\/span><\/td>\n<\/tr>\n
        United Kingdom<\/span><\/strong><\/td>\n\u00a37,500 (~$9,500) \u2013 donations above must be disclosed<\/span><\/td>\nPermitted but disclosed<\/span><\/td>\nYes (policy development grants)<\/span><\/td>\n<\/tr>\n
        Germany<\/span><\/strong><\/td>\n\u20ac10,000 (~$11,000) \u2013 donations above must be disclosed<\/span><\/td>\nPermitted but disclosed<\/span><\/td>\nYes (matching funds for small donations)<\/span><\/td>\n<\/tr>\n
        United States<\/span><\/strong><\/td>\n$200 \u2013 donations above disclosed to FEC<\/span><\/td>\nBanned (corporations cannot donate directly; can form PACs)<\/span><\/td>\nPresidential public funding system (opt-in)<\/span><\/td>\n<\/tr>\n
        Canada<\/span><\/strong><\/td>\n$200 \u2013 donations above disclosed; strict annual limits<\/span><\/td>\nBanned (corporations cannot donate)<\/span><\/td>\nYes (quarterly allowance to parties)<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

        India\u2018s disclosure threshold of \u20b920,000 is among the highest in the world. The UK threshold is \u00a37,500; Germany\u2018s \u20ac10,000\u2014but in both countries, parties must disclose all donations above these thresholds. India\u2018s problem is not the threshold; it is that the majority of donations are funnelled through loopholes (sub-threshold cash, electoral trusts, \u201cvoluntary contributions\u201d) that bypass disclosure entirely.<\/span><\/p>\n

        As ADR founder Jagdeep Chhokar notes: \u201cThe simplest and only way to make political funding clean is to stop cash payment to political parties. Everything has to be through the digital mode of payment. The prime minister has been advocating cashless payments. Why exclude political parties?\u201d\u00a0<\/span>.<\/span><\/p>\n

        \n

        SECTION 7: THE POLITICAL CONSEQUENCES \u2013 A RIGGED PLAYING FIELD<\/span><\/strong><\/p>\n

        7.1 Financial Dominance = Electoral Dominance<\/span><\/strong><\/p>\n

        The BJP\u2018s overwhelming financial advantage has translated into electoral dominance. As the ADR notes, \u201cfinancial dominance, rather than ideology or public service, has become the primary determinant of political success\u201d\u00a0<\/span>.<\/span><\/p>\n

        Data on declared donations (FY 2024-25)\u00a0<\/span>:<\/span><\/strong><\/p>\n

        \n
        \n
        <\/div>\n<\/div>\n\n\n\n\n\n\n\n\n
        Party<\/span><\/th>\nDeclared Donations (\u20b9 Cr)<\/span><\/th>\n% of Total<\/span><\/th>\n<\/tr>\n<\/thead>\n
        BJP<\/span><\/td>\n6,074<\/span><\/td>\n91.4%<\/span><\/td>\n<\/tr>\n
        Congress<\/span><\/td>\n517<\/span><\/td>\n7.8%<\/span><\/td>\n<\/tr>\n
        AAP<\/span><\/td>\n27<\/span><\/td>\n0.4%<\/span><\/td>\n<\/tr>\n
        CPI-M<\/span><\/td>\nN\/A<\/span><\/td>\n\u2014<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

        The BJP declared \u20b96,074 crore in donations above \u20b920,000\u2014more than ten times the combined total of all other national parties\u00a0<\/span>. Corporate donations accounted for 92% of all declared contributions\u00a0<\/span>.<\/span><\/p>\n

        7.2 The Enforcement Agency Nexus<\/span><\/strong><\/p>\n

        One of the most disturbing revelations from the electoral bonds data was the pattern of donors who faced enforcement agency actions. As Common Cause documented, at least 14 out of 30 major donors had faced raids by the ED, CBI, or tax authorities before making their donations. After the donations, charges were mysteriously stalled or dropped\u00a0<\/span>.<\/span><\/p>\n

        Opposition politicians have repeatedly alleged that the Modi government uses enforcement agencies to \u201ccompel\u201d donations from businesses. As a Congress leader charged, the raids were conducted \u201cto first target the entities and then coerce them into making donations\u201d\u00a0<\/span>.<\/span><\/p>\n

        The government has denied these charges, maintaining that \u201cenforcement agencies are doing their job without interference\u201d\u00a0<\/span>.<\/span><\/p>\n

        \n

        SECTION 8: THE WAY FORWARD \u2013 REFORM PROPOSALS<\/span><\/strong><\/p>\n

        8.1 Lower the Disclosure Threshold \u2013 And Close the Cash Loophole<\/span><\/strong><\/p>\n

        Professor Jagdeep Chhokar\u2018s proposal is straightforward: \u201cStop cash payment to political parties. Everything has to be through the digital mode of payment\u201d\u00a0<\/span>.<\/span><\/p>\n

        All donations\u2014of any amount\u2014should be made through banking channels and disclosed publicly. The distinction between \u201csmall donations\u201d and \u201clarge donations\u201d is meaningless when small donations can be aggregated into large sums without disclosure.<\/span><\/p>\n

        8.2 Require Beneficiary Disclosure for Corporate Donations<\/span><\/strong><\/p>\n

        The Companies Act, 2013, must be amended to restore the pre-2013 requirement that companies disclose not just the amount but the name of the political party receiving the donation\u00a0<\/span>.<\/span><\/p>\n

        8.3 Regulate Electoral Trusts<\/span><\/strong><\/p>\n

        Electoral trusts should be required to disclose:<\/span><\/p>\n

          \n
        • \n

          All donors (including parent companies)<\/span><\/p>\n<\/li>\n

        • \n

          All recipients<\/span><\/p>\n<\/li>\n

        • \n

          All amounts<\/span><\/p>\n<\/li>\n<\/ul>\n

          No trust should be allowed to act as a pass-through vehicle without full transparency.<\/span><\/p>\n

          8.4 Bring Parties Under RTI<\/span><\/strong><\/p>\n

          The ADR\u2018s recommendation to bring political parties under the Right to Information Act\u2014repeated for years\u2014remains unimplemented\u00a0<\/span>. Parties currently enjoy a legal exemption from RTI scrutiny, shielding their finances from public oversight.<\/span><\/p>\n

          8.5 Independent Audit of Party Accounts<\/span><\/strong><\/p>\n

          Party accounts should be audited by the Comptroller and Auditor General (CAG), not by private auditors appointed by the parties themselves\u00a0<\/span>.<\/span><\/p>\n

          8.6 Strengthen Election Commission Powers<\/span><\/strong><\/p>\n

          The ECI should have the power to de-recognize or deregister parties that fail to comply with financial disclosure requirements\u00a0<\/span>.<\/span><\/p>\n

          \n

          CONCLUSION \u2013 FROM BONDS TO LOOPHOLES, THE CRISIS CONTINUES<\/span><\/strong><\/p>\n

          The Supreme Court\u2018s verdict striking down electoral bonds was a landmark victory for transparency and voters\u2018 right to know. The court correctly held that anonymous political funding violates the fundamental right of citizens to make informed electoral choices.<\/span><\/p>\n

          But the verdict did not solve the problem. It merely closed one door\u2014while leaving several others wide open.<\/span><\/p>\n

          What Has Been Lost:<\/span><\/strong><\/p>\n

          \n
          \n
          <\/div>\n<\/div>\n\n\n\n\n\n\n\n\n\n
          Loss<\/span><\/th>\nExplanation<\/span><\/th>\n<\/tr>\n<\/thead>\n
          Voters\u2018 right to know<\/span><\/strong><\/td>\nCitizens still cannot trace the majority of political donations<\/span><\/td>\n<\/tr>\n
          Level playing field<\/span><\/strong><\/td>\nOne party\u2018s financial dominance creates insurmountable electoral advantage<\/span><\/td>\n<\/tr>\n
          Accountability<\/span><\/strong><\/td>\nQuid pro quo arrangements between donors and parties remain hidden<\/span><\/td>\n<\/tr>\n
          Rule of law<\/span><\/strong><\/td>\nDonors who face enforcement action mysteriously receive relief after donations<\/span><\/td>\n<\/tr>\n
          Public trust<\/span><\/strong><\/td>\nCitizens believe elections are bought, not won<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

          What Remains:<\/span><\/strong><\/p>\n

          The ADR\u2018s 2026 report concludes ominously: \u201cThe Supreme Court has observed in a landmark 1958 case that \u2018democracy would be vitiated if results were to be arrived at not on their merits but because money played a part in the bringing about of those decisions.\u2019 This principle is now under grave threat\u201d\u00a0<\/span>.<\/span><\/p>\n

          The electoral bonds scheme legalized corruption for six years. The data it generated\u2014reluctantly disclosed only under court pressure\u2014revealed a system in which political funding is not about ideology or public support but about access, influence, and quid pro quo.<\/span><\/p>\n

          The Unanswered Question:<\/span><\/strong><\/p>\n

          Will Parliament\u2014which benefits from the current opaque system\u2014ever summon the political will to enact the reforms the ADR and the Supreme Court have demanded?<\/span><\/p>\n

          Or will India continue to have elections that are \u201cfree\u201d and \u201cfair\u201d in form\u2014but decided in substance by anonymous money, corporate influence, and a playing field tilted beyond repair?<\/span><\/p>\n

          As the ADR notes: \u201cThere is no dearth of solutions. What is required is courage and will to reform the existing system\u201d\u00a0<\/span>.<\/span><\/p>\n

          That courage has yet to arrive.<\/span><\/p>\n

          \n

          SUMMARY TABLE: POLITICAL FUNDING \u2013 PRE-BONDS, BONDS ERA, AND POST-BONDS<\/span><\/strong><\/p>\n

          \n
          \n
          <\/div>\n<\/div>\n\n\n\n\n\n\n\n\n\n\n\n
          Aspect<\/span><\/th>\nPre-Electoral Bonds (Before 2018)<\/span><\/th>\nElectoral Bonds Era (2018-2024)<\/span><\/th>\nPost-Bonds (2024-2026)<\/span><\/th>\n<\/tr>\n<\/thead>\n
          Anonymous donations<\/span><\/strong><\/td>\nCash donations under \u20b920,000; \u201cvoluntary contributions\u201d<\/span><\/td>\nUnlimited anonymous corporate bonds<\/span><\/td>\nCash loophole returns; electoral trusts surge<\/span><\/td>\n<\/tr>\n
          Corporate donation cap<\/span><\/strong><\/td>\n7.5% of average three-year profits<\/span><\/td>\nUnlimited<\/span><\/td>\nUnlimited (Companies Act unchanged)<\/span><\/td>\n<\/tr>\n
          Beneficiary disclosure<\/span><\/strong><\/td>\nNot required (pre-2013 Act removed it)<\/span><\/td>\nNot required<\/span><\/td>\nNot required<\/span><\/td>\n<\/tr>\n
          Major beneficiary<\/span><\/strong><\/td>\nCongress historically<\/span><\/td>\nBJP (50.6% of bond funds)<\/span><\/td>\nBJP (82% of electoral trust funds)<\/span><\/td>\n<\/tr>\n
          Voter right to know<\/span><\/strong><\/td>\nMinimal<\/span><\/td>\nNone (ruled unconstitutional)<\/span><\/td>\nMinimal<\/span><\/td>\n<\/tr>\n
          Supreme Court intervention<\/span><\/strong><\/td>\n\u2014<\/span><\/td>\nScheme struck down (Feb 2024)<\/span><\/td>\nNone on remaining loopholes<\/span><\/td>\n<\/tr>\n
          Transparency rating<\/span><\/strong><\/td>\nPoor<\/span><\/td>\nWorst<\/span><\/td>\nPoor<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n
          \n

          END OF TOPIC 19<\/span><\/strong><\/p>\n

          Next Topic (Topic 20):<\/span><\/strong>\u00a0\u201cElectoral Trusts \u2013 The New Anonymity Vehicle\u201d<\/span><\/p>\n

          To be continued tomorrow with in-depth analysis of how electoral trusts have become the primary channel for corporate political funding after the ban on electoral bonds, and why they represent an ongoing threat to transparency.<\/span><\/em><\/p>\n

           <\/p>\n","protected":false},"excerpt":{"rendered":"

          TOPIC 19 Transparency Concerns Surrounding Anonymous Political Financing In February 2024, India\u2018s Supreme Court struck down the Electoral Bond Scheme, calling it \u201cunconstitutional\u201d and a violation of citizens\u2019 right to know\u00a0. The scheme, which had allowed unlimited anonymous donations to political parties for nearly six years, was a \u201cturning point\u201d that \u201cinstitutionalized opacity\u201d\u00a0. But the […]<\/p>\n","protected":false},"author":1,"featured_media":4089,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"googlesitekit_rrm_CAowk73GDA:productID":"","footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[49,46],"tags":[1178,1172,1173,1186,1180,1183,1118,1176,1091,1184,764,1174,1177,1187,1062,1078,763,782,1182,1179,1171,1185,1175,354,1181],"class_list":["post-4088","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-social-myths","category-truth-facts","tag-adr-reports","tag-anonymous-donations","tag-bjp-funding","tag-black-money-in-politics","tag-campaign-funding","tag-companies-act","tag-constitutional-debate","tag-corporate-political-donations","tag-democratic-accountability","tag-election-reforms","tag-electoral-bonds","tag-electoral-transparency","tag-electoral-trusts","tag-finance-ministry","tag-governance-in-india","tag-indian-constitution","tag-indian-democracy","tag-indian-elections","tag-political-corruption","tag-political-finance","tag-political-funding-in-india","tag-political-parties-in-india","tag-state-bank-of-india","tag-supreme-court-of-india","tag-transparency-in-politics"],"aioseo_notices":[],"jetpack_publicize_connections":[],"_links":{"self":[{"href":"https:\/\/untoldpages.in\/index.php?rest_route=\/wp\/v2\/posts\/4088","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/untoldpages.in\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/untoldpages.in\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/untoldpages.in\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/untoldpages.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4088"}],"version-history":[{"count":1,"href":"https:\/\/untoldpages.in\/index.php?rest_route=\/wp\/v2\/posts\/4088\/revisions"}],"predecessor-version":[{"id":4090,"href":"https:\/\/untoldpages.in\/index.php?rest_route=\/wp\/v2\/posts\/4088\/revisions\/4090"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/untoldpages.in\/index.php?rest_route=\/wp\/v2\/media\/4089"}],"wp:attachment":[{"href":"https:\/\/untoldpages.in\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4088"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/untoldpages.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4088"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/untoldpages.in\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4088"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}