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Mahesh

23/11/22 05:42 AM IST

SBI sold electoral bonds worth ₹10,246 crore since March 2018: Report

In News 
  • The State Bank of India (SBI) sold electoral bonds worth ₹10,246 crore since the instrument was launched in March 2018.
Background 
  • In 2014, the Delhi HC found both the Congress and BJP guilty of illegally accepting donations from a foreign company, in contravention of the Foreign Contribution (Regulation) Act (FCRA), 1976.
  • Following this, the two parties came together to amend the FCRA to retrospectively legalise the violations, bringing in full anonymity to corporate and foreign political donors.
  • Previously, only profit-making domestic companies could contribute to political parties, now, loss-making can as well.
  • Foreign companies could not previously contribute. A foreign firm operating in India or a foreign entity through a shell company may fund Indian political parties now.
  • In 2017, the anonymous cash donations to political parties were reduced from ₹20,000 to ₹2,000 to ensure greater transparency in political funding.
Electoral Bond Scheme 
  • State Bank of India is authorised to issue and encash these bonds.
  • Electoral bonds are purchased anonymously by donors and are valid for 15 days from the date of issue.
  • As debt instruments, these can be bought by donors from a bank, and the political party can then encash them.
  • These can be redeemed only by an eligible party by depositing the same in its designated account maintained with a bank.
  • The bonds are issued by SBI in denominations of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh and Rs 1 crore.
  • The bonds are available for purchase by any citizen of India for a period of ten days each in the months of January, April, July and October as may be specified by the Central Government.
Concerns 
  • The Indian Supreme Court has long held that the “right to know”, especially in the context of elections, is an integral part of the right to freedom of expression (Article 19) under the Indian Constitution.
  • Electoral bonds provide no details to the citizens.
  • The said anonymity does not apply to the government of the day, which can always access the donor details by demanding the data from the State Bank of India (SBI).
  • This implies that the government in power can leverage this information and disrupt free and fair elections.
Way Forward 
  • There is a need for effective regulation of political financing along with bold reforms to break the vicious cycle of corruption and erosion of quality of democratic polity.
  • It is crucial to plug the loopholes in the current laws to make the entire governance machinery more accountable and transparent.
  • Voters can also help bring in substantial changes by demanding awareness campaigns.
  • If voters reject candidates and parties that overspend or bribe them, democracy would move a step higher.
Source- Live Mint 

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