Electoral bonds were not perfect, but better than ‘completely imperfect’ system: Finance Minister

The electoral bond scheme was not perfect but was better than a “completely imperfect” system, Union Finance Minister Nirmala Sitharaman said on Friday, according to India Today.

The finance minister also said the narrative that companies donated funds to the Bharatiya Janata Party to avoid action by central agencies in corruption cases was just an assumption.

"What if the companies gave the money, and after that, we still went and knocked at their doors through the Enforcement Directorate?” Sitharaman asked. “…The second assumption in that itself is, are you sure they gave it to the BJP? They probably gave it to the regional parties.”

While the Election Commission published details about electoral bonds on its website on Thursday, the data did not mention the serial numbers of the bonds, which would have allowed for matching the entities that donated funds with the political parties that received them. The poll panel said it uploaded data that the State Bank of India submitted to it on March 12 on an “as is where is basis”.

On Friday, the Supreme Court verbally observed that the State Bank of India must disclose these serial numbers. On February 15, the court struck down the electoral bonds scheme as unconstitutional, and said they could lead to quid pro quo arrangements between donors and political parties.

However, the finance minister claimed that electoral bonds were introduced with the rationale that at least one aspect of political funding would be cleaner.

“Let us recall what my predecessor [former Finance Minister Arun Jaitley] said when he brought this electoral bonds scheme,” the Bharatiya Janata Party leader said at the India Today Conclave. “He had said ‘this is better than the previous systems as the money is going from accounts to party's account’.”

Electoral bonds were monetary instruments that citizens or corporate groups could buy from the State Bank of India and give to a political party, which could then redeem them.

The entire process was anonymous since buyers were not required to declare their purchase of these interest-free bonds and political parties did not need to show the source of the money. However, the Centre could access information about these donors as it controls the State Bank of India.

Electoral bond case in Supreme Court

The Supreme Court had on February 15 directed the State Bank of India to issue details of the political parties that received electoral bonds from April 12, 2019, and submit them to the Election Commission by March 6.

On March 4, the government-owned bank sought an extension till June 30 from the court to provide the information to the Election Commission.

The top court on Monday dismissed the bank’s plea and directed it to disclose the details of the electoral bonds to the Election Commission by March 12.

On Wednesday, the bank in an affidavit to the top court said it had furnished the names of purchasers of electoral bonds between April 2019 and February 15, 2024, to the Election Commission.

A total of 22,217 electoral bonds were purchased and 22,030 were redeemed by political parties between April 1, 2019, and February 15, 2024, the affidavit said.

Also read:

• Reliance-linked firms bought electoral bonds in crucial election years – after an amendment

• Telangana-Andhra firm bought bonds worth Rs 55 crore six months after tax raids

• Read more analysis on this topic by the Project Electoral Bond, a collaborative project involving Scroll, The News Minute, Newslaundry and freelance journalists.