Need a year to test electoral bonds’ viability: EC officials
, ET Bureau|
Jan 05, 2018, 08.02 AM IST
NEW DELHI: Some senior officials at the Election Commission of India are of the view that it will take about a year to "assess" the efficacy of the recently unveiled electoral bonds, introduced as part of a plan to clean up political funding in the country.
Highly placed sources at Nirvachan Sadan said the functioning of the system will have to be scrutinised over at least one whole election cycle this year, referring to the assembly polls that are scheduled in eight states by October.
The electoral bonds, which are interest-free bearer instruments in the nature of Promissory Notes, will be made available for purchase for 10 days each in January, April, July and October.
An additional period of 30 days would be specified by the Centre in the year of general elections.
The bonds will be available from specified branches of the State Bank of India. The government has introduced the concept of anonymous donors to protect the identity of corporate entities that may feel compelled to appease both the ruling party and opposition parties as per existing norms. However, Election Commission officials said maintaining secrecy over a donor's identity will remain a big challenge.
"Banks have the KYC (know your customer) details of the donors and could be coerced into revealing the details. Anyone can hire a private detective to get the details out," an EC official said.
After the electoral bonds were proposed in the budget last year, the poll body under former election commissioner Nasim Zaidi had raised concerns over the opaqueness of the scheme. It specifically objected to amendments in the Representation of the People Act and the Companies Act, which exempted political parties from disclosing donations received through electoral bonds and removed the cap on corporate contributions to political parties.
The amendments only discourage transparency in political funding, the commission said in acommunication to the law ministry in May. It said removal of the limit on corporate funding could lead to shell companies being set up for the purpose of donations.
Highly placed sources at Nirvachan Sadan said the functioning of the system will have to be scrutinised over at least one whole election cycle this year, referring to the assembly polls that are scheduled in eight states by October.
The electoral bonds, which are interest-free bearer instruments in the nature of Promissory Notes, will be made available for purchase for 10 days each in January, April, July and October.
An additional period of 30 days would be specified by the Centre in the year of general elections.
The bonds will be available from specified branches of the State Bank of India. The government has introduced the concept of anonymous donors to protect the identity of corporate entities that may feel compelled to appease both the ruling party and opposition parties as per existing norms. However, Election Commission officials said maintaining secrecy over a donor's identity will remain a big challenge.
"Banks have the KYC (know your customer) details of the donors and could be coerced into revealing the details. Anyone can hire a private detective to get the details out," an EC official said.
After the electoral bonds were proposed in the budget last year, the poll body under former election commissioner Nasim Zaidi had raised concerns over the opaqueness of the scheme. It specifically objected to amendments in the Representation of the People Act and the Companies Act, which exempted political parties from disclosing donations received through electoral bonds and removed the cap on corporate contributions to political parties.
The amendments only discourage transparency in political funding, the commission said in acommunication to the law ministry in May. It said removal of the limit on corporate funding could lead to shell companies being set up for the purpose of donations.
