Explainer India

Explainer: What Are Electoral Bonds?

In a “very significant judgment which will have a long-term effect on our electoral democracy”, the Supreme Court on Thursday unanimously struck down the electoral bonds scheme. The court held that the scheme allowing for anonymous political donations is “violative of the right to information” under the constitution.

What are Electoral Bonds?

The government introduced the electoral bonds scheme in 2018 as an alternative political funding system. Individuals and companies could purchase the bearer bonds anonymously from the SBI and donate them to political parties. The scheme aimed to reduce black money in politics but lacked transparency.

Why the Scheme Was Challenged?

Though promoted as cleansing political funding, the scheme was accused of enabling opaque donations. With no caps on amounts and donor anonymity, it risked quid pro quo deals between parties and big donors. Hence, petitions were filed alleging violation of the right to information and promotion of corruption.

Unanimous Verdict Against the Scheme

Hearing a batch of pleas, a Constitution Bench of the Supreme Court struck down the electoral bonds scheme unanimously. The court held that depriving citizens of information on political funding infringes on their right to know under Article 19(1)(a). Such non-disclosure can adversely impact informed voting choices.

Broader Impact on Democratic Transparency

By scrapping anonymous donations, the verdict upholds transparency in a sphere crucial for democracy. It requires full disclosure of contributions received by parties via electoral bonds to date. Thereby, citizens can understand possible influences on parties that affect policy-making. This landmark judgment aims to safeguard the integrity of electoral choices.

Thus, the apex court has enforced accountability in political finance. Through its historic ruling, the court emphasizes that an informed, aware public is pivotal for free and fair elections. Hence, citizens have an inviolable right to information on political funding from state and political actors. This verdict is a significant boost for transparent, ethical Indian democracy.

Also Read: What Supreme Court Said On ā€œUnconstitutionalā€ Electoral Bonds

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