Prime Minister Narendra Modi’s big claim that no corruption charge has ever tarnished his government lies in tatters after the Supreme Court declared the electoral bonds scheme ‘illegal’ and ‘unconstitutional’.
The anti-corruption plank is dramatically slipping from under Modi’s feet as revelations about the real nature of anonymous contributions to political parties via electoral bonds, with the BJP being the largest beneficiary, are coming thick and fast.
Every official claim made before the launch of the murky scheme in 2017 stands totally discredited. Remember, the then Finance Minister Arun Jaitley boasted that established Indian corporates wanted this scheme to bring in white money into the electoral system and that they just wanted their identities protected.
This argument becomes laughable on a cursory scrutiny of the list which has largely small unknown companies, many acting as fronts of big corporates, pumping 10 to 100 times their net profit via electoral bonds.
Why would a company want to be so generous as to give 100 times its profits to a political party?
Just think about the various possible motivations for doing this. Were some of these companies designed to just launder money for politicians? If so, what might have been the quid pro quo, a question Chief Justice of India D.Y. Chandrachud kept asking during the hearing of the electoral bonds case.
What is the role of investigative agencies in extorting money out of infrastructure companies which are doing mega projects across India?
Finance minister Nirmala Sitharaman has sought to defend her government by asking a meaningless question: “How do you know the contributions by companies came only after they were raided?”
The finance minister suggests that bonds could have been bought before the raids. She may be jumping the gun as more revelations in this regard are in the offing.
The role of ED, Income Tax department and CBI, in what appears like an institutionalised extortion racket, was revealed earlier in an investigation by The News Minute and Newslaundry, which showed how over Rs 300 crore of electoral funding via the open trust route by some companies happened after investigations were launched against them by the ED and Income Tax department. This pattern is now also visible among the companies which have contributed huge sums via electoral bonds.
Modi’s anti-corruption plank was badly dented during the Karnataka elections itself when the charge of “40% Sarkara” had defined the character of the BJP rule. Large infrastructure projects, tom-tommed as a key driver of growth in the Modi era, seem to have opened floodgates of payouts so omnipresent in the electoral bonds saga. Guaranteed commissions seem to be the name of the game. It can easily appear in one of the ads of “Modi ki Guarantee”(Modi’s guarantee).
Congress leader Rahul Gandhi has charged Modi with running the biggest extortion racket in the name of electoral bonds. The opposition parties are likely to escalate this campaign against Modi in the coming weeks as the election campaign hots up. True, opposition parties, too, have also got funds from electoral bonds, each receiving about 5% to 20% of what BJP had got.
If one includes the other official sources of funding such as the electoral trust route and the Rs 20,000 and above contributions which are recorded, the share of the opposition goes down even further as the BJP has received 80% to 85% of those monies.
It is evident the playing field is very skewed and the institutionalised misuse of agencies like ED and Income Tax department has largely contributed to this. In fact, the BJP had become quite brazen about it. Sometime ago, Prime Minister Modi boasted that his government had the unique distinction of having seized over Rs 1.12 lakh crore worth of assets of companies and individuals during his tenure. The ED has been on steroids for the last 10 years and its conviction rate remains as low as 0.5% of the PMLA cases launched.
It is a moot question how many of these companies whom the ED, CBI or Income Tax department were pursuing bought electoral bonds. Many small companies may have acted as front companies like the one which has turned out to be a private, unlisted subsidiary of Reliance Retail.
Before the electoral bonds came, there was a ceiling of 7.5% of the previous three years’ net profits beyond which companies could not donate. There was a reason for this ceiling. It limited the quid pro quo element to some extent and protected the shareholders interest too. And it was revealed by both the political party and the company in their respective books. There was far more transparency then. The Electoral Bond scheme just removed the ceiling on net profits and made the contributions anonymous. This was an invitation to corruption as the nature of companies that have bought electoral bonds shows.
That the Electoral Bond scheme is a can of worms is not in doubt anymore. A large group like Vedanta is shown as having contributed over Rs 300 crore between 2019 and 2022 while being investigated by the ED and CBI. Worse, during this period Prime Minister Modi also handpicks Vedanta as a partner of the government for launching the ambitious and “Atmanirbhar” semiconductor chips project in Gujarat for which the Centre announces a grant of over $5 billion. Modi inaugurated it just before the Gujarat state elections. How can a company under serious investigation for money laundering be part of such a prestigious project in which the government is pumping in Rs 50,000 crore.
Thankfully, Vedanta could not deliver with its weak partner Foxconn and eventually got out of the project, which is now being implemented by Tatas. Modi inaugurated it a week ago.
The slow unravelling of the electoral bond scam will surely become an important conversation in the run-up to the Lok Sabha election. The dirty tricks department of the government will attempt multiple distractions to shift focus on other things. But this time it may not be so easy for Modi to divert attention. His anti-corruption plank is now full of gaping holes.
On the other hand, the opposition has a sitting duck in front of them. Even an incompetent opposition will find it difficult to botch up this one!
