The verdict of the Supreme Court against Electoral Bonds has become the talk of the town. It is worth noting that on Thursday, 15th Feb 2024, the Supreme Court of India prohibited the electoral bonds that were introduced by the central government in 2018. While scrapping the electoral bonds scheme, the Supreme Court stated “This is India, there is a delay here, not darkness”. Now, people are getting curious to know the reason for its prohibition especially ahead of the upcoming Lok Sabha elections. The search rate regarding the same is quite high on Google.
After learning the verdict of the Supreme Court, a political analyst has shared his views regarding the same. According to a political analyst, the ban on the sale of these bonds will leave a deep impact and directly affect the funding of political parties. During the verdict, the Court of Appeals called electoral bonds “unconstitutional”. Before talking about the impact of the banned anonymous political funding schemes, let’s understand its meaning and why it had been introduced by Modi’s government.
What Is Electoral Bonds and when was it introduced
As we already mentioned above, the electoral bonds had been introduced by Modi’s government in 2018. Electoral bonds were an enigmatic source of generating funding for elections. With the help of electoral bonds, hundreds of millions of dollars had been generated by political parties, particularly the governing party “Bhartiya Janata Party (BJP). Simply put in words, the Electoral Bond used to be a mode of funding to political parties in India.
Under the electoral bond system, the central government states that the bonds must be purchased from the State Bank of India (SBI) but can be donated to parties unnamed. Large donors are likely to be discouraged from using electoral bonds to support opposition parties, even though they are ostensibly anonymous. This is because, as a state sector bank, SBI effectively provides the governing party with undisclosed access to its data.
Why the Supreme Court Banned Electoral Bonds
The court of appeals announced the verdict against the Electoral Bonds while hearing an ongoing petition. While hearing the petition of scrapping the bonds, the top court stated that the bonds “put a premium on opacity” and could be “misused for money laundering.” The ruling of the court fundamentally determines how the upcoming general elections of India that will be held between March and May will be fought, and what kind of role untraced or anonymous sources play.
In 2017, the Reserve Bank of India (RBI) cautioned the central government that there were high chances of the misuse of electoral bonds by shell companies to “facilitate money laundering”. The Election Commission of India (ECI) called the system in 2019 as a “retrograde step as far as transparency of donations is concerned”.
Some of the reports further added that the anonymous donors have donated approximately 16,000 crore rupees to Indian political parties using electoral bonds as the medium of donation. In addition to this from 2018 to March 2022, – the period analysed by a non-governmental organisation known as the Association for Democratic Reforms (ADR)- 57% of donations through electoral bonds (approx $600) went into the account of BJP.
What Will Be The Impact Of The Scrapped Electoral Bonds
Amitabh Tiwari, the political strategist and commentator shared his views on the ban on electoral bonds. As per him, “There will be no gainers or losers” and it will leave no such major impact on any Indian political parties as most of the funding of the parties usually comes from other sources.