India's big business houses back winning political horse

The latest report on political funding makes it clear that India’s Big Biz switches its allegiance to whoever is in power.

Published: 19th August 2017 12:27 AM  |   Last Updated: 19th August 2017 02:35 PM   |  A+A-

Representational Image. | File Photo

Express News Service

CHENNAI: The latest report on political funding makes it clear that India’s Big Biz switches its allegiance to whoever is in power. 

The report, which was released by the Association for Democratic Reforms (ADR), a poll watchdog found that the Bharatiya Janata Party was the top recipient of corporate funding during the period 2012-2016. In contrast, during the period between 2004 and 2012, it was the Indian National Congress, which was the top target of the donors.

The NGO analysed the sources of funding of five national parties -- the BJP, the Congress, the Nationalist Congress Party (NCP), CPI and CPM. It was found that 89 per cent of the funding for these political parties came from corporate houses. 

The findings of the latest report make an interesting comparison with the previous ADR report on political funding, which came out in 2013.

For the sake of convenience, we will call, the eight-year period since 2004 as simply ‘eight-year period’ and the four-year period since 2012 as “four-year period”.

Although the BJP received the maximum corporate funding during the years 2012-2016, the other parties also saw an increase in the flow of money from Big Business compared to the 2004-2012 period. 

A key highlight of the latest report is the dramatic rise in corporate funding. Although there were two Lok Sabha elections and 52 Assembly elections during the eight-year period, the total corporate funding amounted to only Rs.379 crore. 

However, during the 2012-2016 period, which saw only one Lok Sabha election and 24 Assembly elections, ADR found that there was a disproportionate increase in cash flow from big businesses to the five parties. 

The report says the five received in total a whopping 979 crore in funding during the period. That’s a 152 per cent rise in just four years!  

BJP is corporates’ first choice

The BJP bagged Rs 705 crore (73 per cent) of the total Rs 956 crores corporate money dolled out to the five parties. In contrast, its main opponent, the Indian National Congress received only Rs 198 crores or 20 per cent of the corporate money. 

The other three accounted for the remaining eight per cent. Given this fact, almost anyone would assume that BJP has the highest number donors. It does. But how much more than other parties? The contrast here is even more dramatic. 

As many as 2987 of the 3256 corporate donors chipped in money for the BJP. In contrast, the INC could claim the financial backing of only 167 or 5 per cent of all the corporate donors. The CPM and CPI received money from 45 and 17 corporate houses respectively.    

Corporate funding peaked in 2014, thanks to Lok Sabha election

Surprised by the dramatic surge in the corporate funding of political parties during the four-year period? A quick analysis of the funding trends shows that 2014 Lok Sabha elections could be the driver.

Approximately 60 per cent of the total corporate donations in the four-year period was made during the years 2014-15 alone. In other words, Rs 573 crores out of the total Rs 979 crores corporate funds were chipped in during this crucial year. 

The year leading to the Lok Sabha election, 2013-14 saw the five parties accept Rs 224 crores or 23 per cent of the total funds received in the four-year period. The funding received during other years 2012-13 and 2015-16 accounted for only 18 per cent of the total. In fact, there was an 86 percent slump in the corporate cash flow to political parties in 2015-16 the year following the Lok Sabha election. 

Trusts dominate political funding

So who are these donors by the way? A large share of the corporate funding for political parties was made by various electoral trusts. Many of the big names in the corporate world like Aditya Birla, Bharati Airtel and so forth donate money under the guise of electoral trusts. The arrangement enables both the corporate giants as well as the political class to keep each other at “arms length”. 

The ADR found that Satya Electoral Trust (SET), which was formed just seven months prior to the 2014 Lok Sabha elections was the top donor to three national parties, including BJP and INC, during the four-year period. The trust is made up of a number of business houses including Bharati Airtel, DLF, and Indiabulls Housing Finance. 

Together they donated a total of Rs 260 crore during the four-year period. Of this 193 crore (74 per cent) went to the coffers of the saffron party. In contrast, the INC received only Rs 57 crore (22 per cent) from the trust. 

The SET was seconded by the General Electoral Trust (GET), which was set up by the Aditya Birla Group. The trust donated Rs 70 crore to the BJP and 54 crore to the INC. It is worth noting that SET was the largest donor to both the parties before being overshadowed by the SET in the fund race. 

Other big names in the donor list include Progressive Electoral Trust, Lodha Constructions, and Videocon Industries Limited. 

Lodha Constructions, founded by Mangal Prabhat Lodha, BJP’s Maharashtra vice president, was the third largest contributor of funds to the saffron party and chipped in Rs 16 crore. 


Donations without PAN card or address details substantial

The ADR found that national parties accepted 1933 donations worth of Rs 384 crore without PAN card details during the four-year period since 2012. It was also found that as much as Rs 159 crore was routed to political parties with neither PAN card or address details. 

Digging deeper, the ADR found that in total, the five national parties accepted 18 donations without accompanying PAN card and address details or even details about the mode of payment. The report says such donations amounted to Rs 61 lakh. 

Stay up to date on all the latest Nation news with The New Indian Express App. Download now

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.