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An Explainer by Simran Sharma
On February 15th, 2024, the Indian Supreme Court delivered a landmark verdict, declaring the Electoral Bond Scheme introduced in 2017 as unconstitutional. This scheme, shrouded in secrecy, allowed donations to political parties through anonymous bearer bonds, raising concerns about transparency and undue influence in elections.
What were Electoral Bonds?
- Introduced in 2017, these were bearer bonds purchased from designated branches of the State Bank of India (SBI).
- Anyone, including individuals and corporations, could buy them anonymously.
- Parties receiving these bonds could encash them without disclosing the donor’s identity.
- Proponents argued this curbed black money in political funding.
Why Declared Unconstitutional?
- The Court cited a violation of the Right to Information (Article 19(1)(a)) enshrined in the Constitution.
- Anonymous donations were deemed undemocratic and hindered public scrutiny of party funding.
- The Court argued unlimited corporate donations allowed through the scheme violated Article 14 (equality before the law).
- Concerns existed about potential quid pro quo arrangements between donors and parties due to anonymity.
Future Consequences and Possible Scenarios:
- Increased Scrutiny: Parties face stricter reporting requirements for past donations received through bonds.
- Debates on Reform: Public discourse can now focus on alternative, transparent political funding models.
- Opposition Advantage: Opposition parties might benefit from highlighting transparency issues faced by the ruling party.
- Legislative Changes: Parliament may attempt to introduce a revised, more transparent scheme.
- Court Challenges: Further legal battles regarding alternative models and implementation cannot be ruled out.
Overall, the Supreme Court’s verdict opens a new chapter in Indian political funding. While challenges lie ahead, the focus needs to shift towards fostering a transparent and accountable electoral system.