The case of the anonymous donors

By Vijaya Pushkarna

“I use this money to educate the girl child”, he said with a smile as he explained why he was not letting the petrol price reflect the global reality. It was around mid 2014, and Narendra Modi had just become the prime minister of India.

Almost within a month of the new government taking over, crude oil prices fell from 112 $ a barrel to about 60$ a barrel, almost a historic fall. In the normal course, this would have resulted in a proportional drop in the price we pay to fill up our car tanks. But that did not happen.

The late Arun Jaitely was a genius, no less. He turned many things in favour of the government soon after he took charge as finance minister in 2014. One of them was the revenue the government got by way of excise duty on petroleum products.

Though deregulated and so linked to the  global price, there is a central excise duty and a  state VAT, levied on petroleum products. Jaitely as finance minister decided to hike the excise duty ! So the price per litre of petrol or diesel remained more or less the same when it could have been half the price.

The second thing he turned  was  in favour of  his party.

Till 2016 end, there was tremendous controversy over election funding in the country. It was said to be at the root of all corruption by government, and the basis of crony capitalism. Nobody knew which industrialist paid which party how much, and what favour they got in return, though there was no doubt about the quid pro quo. The minister or the “Mr Moneybag” generally spent  the substantial chunk of it on elections, including the buying of  leaders from across the political divide, and MLAs when the need arose. The “cash for vote” phrase thus made its entry into the political lexicon of  India. It used to happen in the 1970s, but in the new millennium, the money became humungous, given freebees on a massive scale became part of the election expenses.

The Election Commission of India had for long felt that a cap apart, the funding should be done by the government, in order to keep it all clean and above board.

But Jaitely had different ideas of bringing in clean money.  He introduced the idea of electoral bonds in the budget he presented in 2017.Companies and individuals who wanted to fund elections had only to buy the bonds—much like bank drafts—from designated banks (the State Bank of India) through the banking system. This ensured it was the company’s white money! They could then give the electoral bonds to their preferred political party  which had to deposit it in its bank account –making it the party’s  white money ! But the catch from day one, unresolved till date, is which company gave the electoral bond to which party ! That is a closely guarded secret between the company, the SBI and the political party,making for opacity of the bond that was meant to make election funding transparent. Even the Election Commission of India has no idea of where the BJP got much of its electoral bonds from, and there are whispers of shell companies too being the “donors”. There have also been allegations that cash returned during the infamous demonetisation found its way into the BJP kitty this way.

• The Electoral bond scheme was challenged immediately, and a final verdict is expected soon.  The  Supreme Court  had directed all the political parties to file the details of donations, including the names of donors and the amounts, to the Election Commission. That has been done partially, the BJP and the Congress have submitted their audit reports to the Election Commission, though names of donors have not  been revealed .

The BJP garnered the chunk of all the electoral bonds sold so far, with 60 % of its funds – Rs1450 crores—ahead of the 2019 Lok Sabha elections, coming from these bonds. The  government  on its part has maintained that the entities making the donations wanted anonymity.

The case of the anonymous donors will up for hearing in the Supreme Court before the end of the month. And that is a verdict  many are anxiously awaiting.