Discuss whether the introduction of the electoral bond system has made the donation system opaque.

Published: December 7, 2019

The Narendra Modi government introduced the electoral bonds scheme with much fanfare and the promise of bringing in transparency in the funding of political parties. But recent reports by RTI activists reveal that the introduction of electoral bonds was not a victory for transparency, but rather for greater opacity in how elections are funded in this country. 

Electoral bonds by their design are there to reduce transparency in the system and make political funding more opaque. The Reserve Bank of India (RBI) and the Election Commission (EC) also raised concerns that electoral bonds could become vehicles for money laundering, for shell companies and foreign donations to political parties. 

One of the biggest concern in all of the democratic world today is the inability of people to hold their elected representatives accountable, especially when they cannot see who is financing the said politicians. This is one of the biggest flaw of the electoral bond scheme.

Voters being aware of who is financing who is extremely critical for a democracy to remain a democracy and not become an oligarchy. When political parties are being funded by commercial entities, we need to understand that they donate only when they know that the political party will return the favor. If the voters are unaware of this quid pro quo then they cannot decide if a candidate is endorsing a public policy because it’s in the interest of the people or if it’s a favour to their paymasters. 

Before the electoral bonds system was introduced, the political parties had to maintain records of donations above ₹20,000. Details like- PAN card of the donor and the cheque number had to be provided to the EC, which was then put out in public domain. We also know that under the previous system the political parties played the system by limiting their donations to ₹19,999, so to be fair the previous system wasn’t fair as well. The difference between the 2 systems is that the electoral bond system is even more opaque than the system before it. Whatever transparency was under the previous is now totally gone. 

The Government of India has announced that government it’s perfectly all right for individuals and corporations to anonymously donate any amount to any party from anywhere in the country. There can be no transparency as long as the identity of the donor is anonymous, anonymity and transparency are the anti-thesis of each other.

Political parties should maintain the same standards that they impose on the rest of the nation. One of the primary reasons given for demonetisation was to encourage digital payments in the country and shun cash. Everyone from Individuals to massive organizations were asked to comply except for political parties. This is hypocrisy must end if the politicians want to win back the trust of the people.

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