Cover Story
The Electoral Bond Scam and the Corrupt Modi Government
by Dipankar Bhattacharya

The data submitted regarding the Electoral Bonds by the SBI have revealed a very murky pattern around this now defunct unconstitutional scheme. The pattern that has emerged makes the Electoral Bond scheme the most brazen scam of the Modi regime. Taking advantage of the anonymity and secrecy built into the scheme, the government used it as a veritable extortion racket by raiding companies to coerce them into paying huge sums of money and the donors in turn were rewarded with legal protection and lucrative projects and contracts.

India's top three corporate houses do not figure directly in the list of bond purchasers. Investigative journalists tracking the bonds have however located the Ambani footprint in bonds. The Tatas probably prefer their own trust (Progressive Electoral Trust) routes to make political donations and the Adani connection probably lies hidden under layers of shell companies and obscure donors. Several other leading corporate houses however figure quite prominently in the list. The top donors are of course a revelation unto themselves and lay bare the corrupt underbelly of India's increasingly rotten and brazen crony capitalism. The money spent by companies in buying electoral bonds is tax-exempted, but the real benefit lies in the quid pro quo, the correlation between the bonds purchased and the contracts secured, the laws evaded and the penalisation avoided for all sorts of economic offences.

According to this overall picture, the BJP bagged bonds worth a whopping Rs 8,252 crore, more than 50% of the total value of bonds redeemed worth Rs 16,492 crore. The Congress with Rs 1,952 crore is a distant second followed closely by the TMC in third position with Rs 1,705 crore. The fourth and fifth places are held by BRS with Rs 1,408 crore and the BJD with Rs 1,020 crore respectively.

Rather than answering the SC indictment for inflicting an unconstitutional scheme to legalise economic and political corruption, the BJP is now busy trivialising the Electoral Bond scam by claiming that it actually got much less than the opposition parties! It is also being argued that the donations received by the BJP are actually proportionately less than the party's electoral strength. The BJP IT cell is also dishing out outright false statistics to mislead the people. The point to understand is that the Electoral Bond scheme took the standard practice of corporate funding to major parties to a totally new level both in terms of the scale and nature of funding (including all kinds of shady sources from foreign funding to money laundering via shell companies) and the total decimation of the very notion of a level playing field.

The unconstitutionality of the Electoral Bond scheme lay in its utter opacity and asymmetry, which institutionalised clientelism and opened the floodgates of corruption. The serial purchase of Electoral Bonds by Santiago Martin's Future Gaming and Hotel Services company following serial raids on the company and even attachment of the company's assets by the ED testifies to the absolutely murky nature of the scheme. The SBI data show obscure companies with little paid-up capital and profit having bought Electoral Bonds several times their known financial strength. And while the government had total knowledge of which company was paying how much to which party, the people at large and the opposition parties were in total darkness about the flow of funds. The control over information and abuse of agencies - from ED, CBI and various Tax authorities to even the banking system - tilted the scheme totally in favour of the BJP even though some of the regional parties holding power in major states (TMC, BRS, BJD, DMK, YSRCP for example) also had significant shares. The only parties steering clear of corporate funding and Electoral Bonds are the communist and other Left parties.

The Electoral Bonds are only one source of corporate political funding. Prior to the launch of this dubious scheme, Electoral Trusts were the principal vehicle for legal contributions (the quantum of illegal flow and use of cash in elections is anybody's guess). Over the years the Trusts have also gravitated increasingly to the BJP. The richest electoral trust, the Prudent Electoral Trust gave 95% donation to the BJP in FY 2017 and since then it has directed 85% of its funds to the BJP. In FY 2023 five Trusts gave Rs. 366 crore to political parties with the BJP alone getting Rs. 259.08 crore. Ahead of the 2019 elections in FY 2018 the Tatas paid Rs. 356 crore to the BJP through their Progressive Electoral Trust with the Congress getting only Rs. 55 crore. These political contributions apart, the BJP has at its disposal the government's growing advertisement budget and sundry government schemes all of whom revolve around selling the Modi brand. Government advertisements are indistinguishable from the BJP's own party publicity and these are no longer limited to newspapers and radio and television channels, they now swamp every public space and every digital platform. And then there is the mammoth opaque fund launched in the wake of the Covid pandemic under the acronym PM CARES, which collects enormous donations from public sector companies and private corporations and refuses to submit itself to any public scrutiny by calling itself a private entity.

The coffers of the BJP have swelled unprecedentedly in the Modi era by using every possible corrupt, unconstitutional and unethical means. The nexus between the Modi regime and India's top corporate groups has resulted in unprecedented concentration of political and economic power in a few hands. While monopolisation of political power by the Modi government has completely upset India's federal balance and competitive electoral democracy, the growing control of a few oligarchs like the Adani and Ambani groups over the entire economy is landing the overwhelming majority of India's workers, farmers, small traders and the job seeking youth in a permanent state of misery. Defeating the Modi regime in the coming elections is therefore the first step towards freeing the Indian people and India's constitutional democracy from this fascist corporate stranglehold.

The Electoral Bond Scam and  the Corrupt Modi Government