Electoral bonds have been put to rest, but the controversies remain. It is time for India to use this extraordinary judgment of the Supreme Court and the consequential revelations to change the way we look at donations and lobbying
By Sujit Bhar
A major, right-leaning media house has sent out an almost celebratory tweet, saying that the Adani Group, Reliance and the Tatas are not on the electoral bonds list that the State Bank of India (SBI) handed over to the Election Commission of India (ECI) and which the latter has uploaded on its website as per the instructions of the Supreme Court.
The names acknowledged in the tweet are Grasim Industries, Bharti Airtel, Megha Engineering, Torrent Power, DLF Commercial Developers and some others.
What does that prove, even while maintaining that this observation is erroneous? It means that certain companies, that have been in a somewhat poor moral light so far, are actually as pure as driven snow. Here is a caveat.
One donor company, Qwik Supply Chain Pvt Ltd, which had donated about Rs 410 crore to the fund, is actually indirectly owned by Reliance Industries.
A Reuters investigation reveals that Tapas Mitra, one of the directors of Qwik Supply Chain, sits on the board of at least six companies that are part of the Reliance group headed by Mukesh Ambani.
A donation of Rs 410 crore is peanuts for Reliance. Recently Mukesh Ambani spent over Rs 800 crore (some estimates go up to Rs 1,000 crore) on the pre-wedding celebrations of his son Anant Ambani. If the public is to believe that Reliance, Adani and the Tatas have stayed away from donating to the powers that be, as well as to other political powers, then there is serious doubt over the intellectual capabilities of the general public of India.
As for the involvement of the Adani Group, the same Reuters report reveals that Navayuga Engineering Company Limited is another company that bought electoral bonds. This company came into the limelight last year for a rather shady reason.
This was the company contracted to build the Silkyara Tunnel in Uttarakhand that collapsed. It also constructed the Polavaram dam and operated Krishnapatnam port in Andhra Pradesh that has now been taken over by the Adani group. It also used to operate a power transmission project in Gujarat that has been acquired by the Adani group.
Navayuga’s purchase of electoral bonds was worth Rs 55 crore, of which Rs 30 crore was bought on April 18, 2019, just before the Lok Sabha elections.
Highest payout
The highest payout has been from one strange company, called Future Gaming and Hotel Services. The total purchase of bonds by this company is a stupendous Rs 1,368 crore. The head honcho of this company is a person called Santiago Martin, otherwise also referred to India’s “lottery king,” a person who has faced several financial investigations about his financial dealings by government authorities, including by the Enforcement Directorate. He was even under arrest for a while in 2008 in a land scam case.
The amount of money this shady character has thrown into the electoral bond coffers clearly proves not only his complicity in deals that are not exactly above board, but that much of that money has been funnelled through him by other important, high-profile entities.
Another controversial name crops up in the data. This is of Megha Engineering and Infrastructure Limited, associated with the Kaleshwaram lift irrigation project in the state. Megha Krishna Reddy is the top man here, and its association in the controversial water pipeline project in Odisha is known.
When Congress leader Revanth Reddy was not yet the chief minister of Telangana, he had written to the then chief minister K Chandrashekar Rao, alleging that the Megha Krishna Reddy group was a major contributor to the Prudent Electoral Trust. Prudent Electoral Trust is the largest among all the 18 electoral trusts in the country, accepting tax-exempt donations to political parties.
It was set up in 2013 and has received over Rs 20,000 crore. Eight major groups donated heavily to this trust, including the ArcelorMittal group headed by LN Mittal, the GMR group that operates airports in Delhi and Hyderabad, the Essar group controlled by the Ruia family, the Airtel/Sunil Bharti Mittal group, and the RPG Sanjiv Goenka group of Kolkata.
A full audit of these trusts will also reveal tons of information. The functioning of these trusts had recently been investigated by Reuters, revealing scary amounts of money that have moved through these. The now-banned electoral bond system is another, more powerful, instrument.
A tool to an end
Much remains in the domain of the unknown than has been revealed, but at least the Supreme Court has handed all political parties and, especially activists, a long handle to use against corruption.
A very pertinent suggestion has been made by former Congress minister and Rajya Sabha MP Kapil Sibal. He said: Like it was done in the 2G case, where an SIT was made, in this case also an SIT should be constituted to probe the matter. We have to see how the law will see it now. It should also be found out who donated to the PMCARES (fund). It’s a matter of investigation which party got how many funds (sic).”
Whether a special investigative team will be constituted or not depends a lot on the outcome of the ensuing general elections, but it has to be pointed out that the SBI should not be allowed to get away with merely acting as a post office for sensitive data. There are a number of reasons for this. First, how could it allow a junior officer to reply to summons of the top court of the country? Secondly, how was it that with thousands of crores sloshing around in its books, no audit trail was deemed necessary? True that the bonds needed to be redeemed in 15 short days, but in any system, that much money always creates a distortion in the books.
The third issue is the sheer audacity of the bank in deciding to avoid the apex court till the bench headed by Chief Justice of India DY Chandrachud issued a contempt proceeding threat. The SBI is an institution that has earned a great deal of disrepute as being the favoured bank for all who have quit the country with massive loans, never wanting to pay them back.
The SBI, as per its own chest thumping, is the largest bank in India by total assets (the HDFC Bank tops the list in terms of market capitalisation) and has control over a fourth of the Indian market. It serves over 48 crore customers through 22,405 branches and was also one of the largest employers in the world with 245,652 employees as of March 31, 2021.
A bank with so much muscle power had initially claimed before the Supreme Court that a matching job would take till June 30. The head honchos of the bank need to be given a lesson in probity.
The omerta
It has been common knowledge that the Bharatiya Janata Party (BJP) got more than half the funds from the redemption of bonds between 2018 and 2024. It is also true that every political party worth its name has received massive donations through these bonds and through the 18 trusts.
The issue today is about the entire issue of secrecy and of the “quid-pro-quo” that exists (and has barely been proved). The Supreme Court’s landmark judgment last month that held the electoral bond scheme to be “unconstitutional” was because, as the Court put it, it violated citizens’ right to information.
The courts, the institutions and the political parties willing, this can turn out to be a critical phase in this democracy’s workings.
If one believes that corporate bodies donate to political parties just for their love of those parties, then it would not be a very smart thought to hold. Every business investment calculates its return on investment. One has to learn to accept this fact. One has to also learn to accept that the earlier (post-Independence era) system of a complete blackout of information—of even the fact that there have been political donations—was as harmful.
Instead of an information blackout, the country might learn to live with an open system where donations are publicly acknowledged, and lobbying is accepted as a norm. Lobbying is legal in the US, and could easily be acknowledged within this country. The fact that India has moved away from its socialist ideals has been established in every mind. It is now necessary to use this judgment of the Supreme Court to come clean and let the people really participate more proactively in nation building.
That could avoid fiascos such as the electoral bonds.