2024 Lok Sabha Election: BJP’s Financial Advantage
A few weeks before the 2024 Lok Sabha election, the Bharatiya Janata Party (BJP), led by Prime Minister Narendra Modi, has a significant financial advantage, as confirmed by information released by the Election Commission of India (ECI) on March 14. The specifics of political donations worth crores of rupees were disclosed.
Electoral Bonds Issued by SBI
The State Bank of India (SBI) said in an affidavit submitted to the Supreme Court that between April 1, 2019, and February 15, 2024, donors bought 22,217 electoral bonds of various denominations; political parties redeemed 22,030 of those bonds, totaling Rs. 12,769.40 crore. The court ordered the nation’s largest lender, the SBI, which oversaw the electoral bond issuing mechanism, to provide the ECI with the electoral bond details by March 12 or risk being found in contempt.
As a result, the Supreme Court granted the ECI until March 15 at 5 p.m. to post the data on its website. The poll panel’s release of data totals hundreds of pages. One day prior to the deadline set by the court, the ECI published information on “Disclosure of Electoral Bonds Submitted by SBI” on its website in two sections, one of which listed the buyers and the other of which listed the beneficiary parties.
Court Ruling on Anonymous Donations
Until February 15, when a five-judge Constitution Bench struck down the Income Tax Act and the Representation of the People Act amendments that made the donations anonymous, the Center’s electoral bonds scheme—which allowed anonymous political funding—was a major source of funding for political parties. The court ruled that the scheme violated voters’ rights to know who was financing their political parties and that it was “unconstitutional.”
Beneficiaries and Donors
According to data released on March 14, the BJP was by far the largest receiver between April 2019 and January of this year. Up until March 2023, the BJP had received slightly less than 48% of all election bonds cashed by parties, or about Rs. 6,060 crore. The Trinamool Congress, which received Rs. 1,609.50 crore (12.6%), was the second-biggest beneficiary. In comparison, the primary opposition party in India, the Congress, had earned about Rs. 1,421 crore (11%) of the total.
With Rs. 1,214 crore, the Bharat Rashtra Samithi (BRS) was awarded the largest share, followed by the Biju Janata Dal (BJD) with Rs. 775 crore and the Dravida Munnetra Kazhagam (DMK) with Rs. 639 crore. Only Rs. 66 crore went to the Aam Aadmi Party (AAP), and Rs. 6.05 crore to the All India Anna Dravida Munnetra Kazhagam (AIADMK). Notably absent from the beneficiaries list were the Communist parties.
Major Donors in the Political Landscape
The list of bond buyers includes some of the leading blue-chip firms in India, including bonds worth Rs. 35 crore purchased in the name of Indian businessman Lakshmi Niwas Mittal, the executive chairman of global steel producer ArcelorMittal, who is headquartered in the UK. In addition to Lakshmi Niwas Mittal, other donors using electoral bonds were Kiran Mazumdar Shaw, Varun Gupta, B.K. Goenka, Jainendra Shah, and an anonymous individual going by Monika.
The following companies have also contributed: Jindal Group, Phillips Carbon Black Limited, CEAT Tyres, Dr. Reddy’s Laboratories, ITC, Kaypee Enterprises, Cipla, Torrent Power, Bharti Airtel, DLF Commercial Developers, Vedanta Ltd, Apollo Tyres, Edelweiss, PVR, Keventer, Sula Wines, Welspun, Sun Pharma, Vardhman Textiles, and CEAT Tyres. Yashoda Super Speciality Hospital, located in Ghaziabad, bought 162 bonds, most of which were for Rs. 1 crore each. Bonds worth Rs. 18 crore were purchased by Bajaj Auto, Rs. 20 crore by Bajaj Finance, Rs. 36 crore by three IndiGo companies, Rs. 65 lakh by SpiceJet, and Rs. 20 crore by Rahul Bhatia of IndiGo. Qwik Supply Chain Pvt Ltd, situated in Mumbai, purchased bonds from Haldia Energy for Rs. 377 crore and bonds worth Rs. 410 crore.
Largest Donor: Future Gaming
The largest donor, however, is a little-known lottery company called Future Gaming and Hotel Services (owned by “lottery king” Santiago Martin), with bonds worth Rs. 1,368 crore, followed by Qwik Supply Chain at Rs. 410 crore and Megha Engineering and Infrastructure Ltd. at Rs. 966 crore. This information is based on the list made public by the ECI. The Enforcement Directorate looked into Future Gaming in March 2022. The flagship businesses of Gautam Adani and Mukesh Ambani, the two richest billionaires in India, were left off the list.
Geographical Distribution of Donations
Out of all the cities, Kolkata turned out to be the home of the most corporate donations. Sixteen of the top 50 givers of electoral bonds were from the “City of Joy.” Collectively, these corporations headquartered in Kolkata purchased electoral bonds totaling Rs. 1,925.8 crore between April 2019 and January 2024. Haldia Energy was the largest buyer, paying Rs. 377 crore. Mumbai came in second with eight contributors, and Hyderabad came in second with eleven.
Qwik, a firm allegedly connected to the Reliance group—Reliance has refuted reports that it is a subsidiary—has drawn attention after purchasing electoral bonds totaling Rs. 360 crore for the fiscal year 2021–2022, even though the company’s net profit was just Rs. 21.72 crore. Additionally, Biocon’s Kiran Mazumdar Shaw, who has a net worth of around Rs. 6 crore, is listed individually.
Tax Benefits for Donors
Individuals or organizations that donated through electoral bonds also benefited tax-wise. As long as the parties had redeemed the bonds, they qualified for a 100% tax exemption under Sections 80GG and 80GGB of the Income Tax Act, 1961.
Other Parties Redeeming Electoral Bonds
The Shiv Sena, Telugu Desam Party (TDP), YSR Congress, Janata Dal (Secular), Rashtriya Janata Dal (RJD), Jammu and Kashmir National Conference, Goa Forward Party, Maharashtrawadi Gomantak Party, Sikkim Krantikari Morcha, Jharkhand Mukti Morcha, Sikkim Democratic Front, and JanaSena Party (JSP) are among the other parties that redeemed electoral bonds.
NDA’s Response to Criticism
The ruling NDA at the center, which includes the TDP and the JSP from Andhra Pradesh, played down the fact that their names were on the list of parties that have cashed in electoral bonds. Ajay Kumar, a spokesman for JanaSena, stated, “We have people who will give us money also.” Additionally, electoral bonds were lawful.
A previous report published by the Association of Democratic Reforms states that between March 2018 and January 2024, electoral bonds totaling Rs. 16,518 crore were sold. These bonds account for over half of the donations that political parties get. Critics claimed that because the public was unable to investigate whether funders had benefited politically, the program decreased openness. They also believed it would give the government access to donor information through the state-owned SBI, enabling it to determine who was sponsoring opposition parties.
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