Life after electoral bonds: It is time for all parties to bite the transparency bullet

Electoral bonds (EBs) paid a visit to India's political stage from February 1, 2017, to February 15, 2024. It is too soon even to imagine the imprints they left on the political financing scene in the country in these seven years. We need to reassure ourselves that there will be life after EBs equally as much as there was life before EBs. 

It is just a coincidence that in a longish essay I wrote in the February 18, 2017, issue of a news journal, I had come to the following conclusions:

"Political parties are not willing to disclose sources of their funds. They will go to any lengths, including using the Parliament and the entire bureaucracy, to prevent disclosure of the sources of their funds. They are even ready to blatantly defy legitimate, legal, and constitutional decisions of the highest statutory authority in the land (the Central Information Commission).”

The journal also had asked me for solutions, and what I said then was: "The only solution seems to be for the civil society, the media, and the judiciary to work in synchrony to achieve this.”

Reflecting on that essay today, EBs seem to have brought these three sections of the society to actually work together, with some notable exceptions of course.

The question “what next” lingers however.

Before travelling in that direction, let us reflect for a moment on 'life before EBs’, or to put it in a broader term, ‘how was India's democracy faring till 2017’ when EBs made their first appearance.

A not uncommon assessment may say that Indian democracy was alive and well from Independence till 2016, except for the mercifully short flirtation with authoritarianism during the infamous Emergency. Obviously, there were problems and infirmities because as the cliché goes “democracy is a journey, not a destination” and no democracy can be perfect. That is precisely why several civil society organisations (including the one with which I work) have been working for varying periods of time.

A question that needs a response is: What can be the legitimate and practical sources of transparent political funding in India? This question itself is a riddle which the late Arun Jaitley tried to solve. The solution finally stumbled on the issue of ‘transparency’.

The transparency issue is the one that needs to be faced squarely. Why do donors want confidentiality which the government is very keen to provide and protect? Two reasons come to mind, one which is well known and another which is known but not spoken about.

The well-known reason is vindictive action. If a corporate donates to one party, it faces the prospect of being harassed by another party which may be in power in another state where the corporate has interests. The solution to this is simple but requires something that seems an impossibility in the current scenario: Responsible behaviour by all political parties.

By definition, vindictive action is taken by one political party against the donor to another political party. What prevents all political parties from coming to a 'gentlemen’s agreement' that they will not victimise one another’s donors?

The other unspoken reason is siphoning a part of the money when cash transfers take place. A slightly detailed explanation may help in clearing what the word ‘siphoning’ hides in its sophistication.

Let’s assume there is an agreement between a corporate leader (CL) and a political leader (PL) that the CL will pay Rs 100 crore to the party of the PL. Being ‘big’ leaders, these two persons will not pass on the cash between them personally. They will use their ‘trusted subordinates’ (TS) to handle this delicate but important task. The CL will authorise her/his TS to deliver Rs 100 crore cash to the PL. The TS of the CL will carry the cash not directly to the PL but to the TS of the PL. It is possible that the TS of the CL tells the TS of the PL that “Seth-ji has sent only Rs 95 crore for now. The balance will follow". Given the nature of the transaction, it is likely (or at least, possible) that the TS of the PL might not ask his boss but will accept the Rs 95 crore, and, in turn, tells her/his boss, the PL, that the CL has sent only Rs 90 crore. The PL may think 90 crore to be adequate for the time being.

There is no doubt that this is an imagined scenario. It dawned on me after a TV discussion in which a political leader said to me that they (the politicians) wanted donations by cheque but the corporate leaders wanted to give only cash. In the same discussion, a corporate leader, in the presence of the political leader, said that they (the corporates) wanted to give donations by cheque but the politicians wanted only cash.

The only way out is to bite the transparency bullet. Everyone should be allowed to donate to political parties but all the donations, without exception, should be through digital means.

Post-demonetisation, if the country was to move towards a digital, cashless economy, and all citizens were exhorted to make payments through cell phones, using UPI, in which we are the leaders of the entire world, what prevents political parties from accepting all donations and all other income digitally, and also do all their expenditures digitally?

(The author is co-founder of Association for Democratic Reforms)