Daily new exposes of the issues linked to the electoral bonds are appearing in the media. What should have been exposed by the official agencies is being unearthed by the media, thereby testifying to its vibrancy, in spite of its capture by the establishment. With the vast majority of the bonds bought in denominations of Rs 10 lakh and Rs 1 crore, it is clear that these were purchased by the wealthy and businesses. Businesses work to maximise profit by minimising costs. So, expenditure is incurred by businesses to enhance profit.
How do donations lead to more profits? Via manipulations of policies based on quid pro quo. That explains why even companies running at a loss or having little profit donated to the ruling party. Since the donation would have led to increased loss or wiping out the small profit, the benefit must be much greater than the donation. Corruption is known to be highly profitable.
Returns from donation to the ruling party take many forms. Lucrative contracts, manipulation of policy to favour the business, closing of prosecution for some illegality and overlooking of illegality committed in business. There can also be arm-twisting of businessmen to extract donations. Examples of all these have been revealed by the data on the bonds. Ruling party leaders seem to be unperturbed by these revelations.
Also read: Seven Points That Merit Investigations: The Electoral Bonds Saga Isn’t Over With Data Spilling Out
Official responses of PM and home minister
The prime minister in an interview to Thanthi TV, on April 1, 2024, exuded confidence. He made several points. One, electoral bonds were a mechanism to trace the origins of funding to political parties and bring about transparency in electoral funding. Second, the issue has neither embarrassed the party nor led to a setback to the BJP. Third, the opposition will regret the exposes that have appeared. Fourth, before 2014 no one could tell where the political party funding was coming from. Finally, he said the scheme was good but if there were deficiencies, they could be removed.
What stands out is that he feels that the opposition needs to worry, not the ruling party. But, more than 50% of the donations went to the ruling party. The implication is that the opposition will be investigated but not the BJP.
Further, the scheme was designed to keep the names of the donors a secret. So, how could the scheme be a transparent mechanism for funding political parties? The names of the donors have come out consequent to the Supreme Court judgment declaring the scheme ‘unconstitutional’ and asking the State Bank of India to reveal all the data. In fact, according to those who designed the scheme, not only the names of donors but even the trail of funds was not to be made public.
Soon after the Supreme Court judgment came, the home minister in an interview said, now on, elections would be funded by black money. He implied that electoral bonds were bought with white money, so electoral funding was being done with legitimate funds. He also justified the large sums of funds received by the ruling party by comparing proportionate amounts received by political parties. He argued that per MP in parliament, the BJP received less funds than some opposition parties.
The home minister also said that once all the details of the bonds are out, the opposition will not have any face to show. The implication is that he knew who got how much from whom. But that was contrary to the design. SBI also implied in its initial response that it did not have this record and would require three months to collate the data which was held in two separate silos. S.C. Garg, secretary in the Ministry of Finance, who was apparently in charge of the design of the scheme in 2018, had also said that there is no way that the donors and the recipients can be matched. This has proved to be incorrect.
The critics and the opposition parties had feared from the start that only the government would get to know who donated how much to which party. The implication was that not only the scheme was opaque, it was open to manipulation by the ruling party. It could squeeze the funding of opposition parties by threatening their donors.
Also read: Electoral Bonds: All the Details on the Wire’s Dashboard
What next?
Thanks to the media, quid pro quo and the money trail have been exposed in the case of several of the donations. The official agencies should by now have started to investigate and prosecute. Money donated by loss-making companies and where the donation is far higher than the profit could be cases of money laundering. Donations by unknown companies could be cases of shell companies. Investigation and prosecution should be quickly launched in these cases.
Can the official agencies be trusted to carry out independent investigations against the ruling dispensation? There is a need for an independent committee monitored by the courts. While the recent experience with the court-appointed committee on the Hindenburg-Adani episode was not very encouraging, there is no other option.
Also read: Will Modi Probe Loss-Making Firms Which Donated Electoral Bonds to BJP?
An example
Scroll.in, on March 27, has in detail brought out how “Eutelsat OneWeb, which is in a prime position to get satellite spectrum without an auction, is owned by Bharti Enterprises, UK government, SoftBank, among others”. Data shows that Bharti Group donated a total of Rs 150 crore to the ruling party before and after the government introduced a new Telecommunications Bill in December 2023. The Bill was hurriedly passed and became law on Christmas eve.
Bharti Airtel bought bonds worth Rs 100 crore and donated them entirely to the BJP. On November 21, OneWeb got authorisation from the space regulator to qualify to get satellite spectrum. Bharti bought another Rs 50 crore of bonds which were encashed by the BJP on January 12, 2024. Data shows, Bharti group companies Bharti Infratel and Bharti Telemedia also donated funds.
There is more. Bharti Airtel is the biggest loss-making company donating to the ruling party. Its cumulative loss was Rs 76,954.7 crore, it received a tax refund of Rs 8,250 crore and donated Rs 198 crore, of which 99.7% went to the BJP. Did the company also pay to receive the tax refund?
Just as the Delhi liquor scam has been under investigation by official agencies for the past two years, shouldn’t the agencies also pursue the Bharti Airtel case? Similarly, just as in the case of the Aam Aadmi Party, shouldn’t businessmen and political leaders be arrested to uncover the truth, since the money trail is evident in black and white in the accounts, unlike in the case of AAP?
The argument that the electoral bonds, declared unconstitutional by the apex court, were brought in for transparency or for financing the elections is incorrect. Data reveals potential quid quo pro with policymakers granting favours to businesses in telecom, pharmaceutical, infrastructure, and so on. All such cases need to be actively pursued since the money trail is revealed by the data.
Arun Kumar is the author of The Black Economy in India.
