LUCKNOW: In a state where even ensuring an election ticket allegedly costs some candidates crores, one may well imagine the prevalence of black money in the biggest jamboree of democracy celebrated every five years. Will Prime Minister Narendra Modi’s move to demonetise high value notes put a check on the rampant prevalence of ill-gotten money in the states’ elections due in a couple of months from now?
It’s at least a job well begun, feel a host of experts and social activists The Sunday Standard spoke to. But much will depend on the execution and how well various ways of money-laundering are checked, they say.
“On the face of it, the step will check black money circulation in the upcoming polls. But on the other side of it, those who use black money to win elections will do anything to woo voters. Since unaccounted money is an important part of elections, those pitching in will start distributing it right away. As per provision, notes can be converted till December 30, 2016, so the voter can avail of this facility easily,” Prof Trilochan Sastry of the Association of Democratic Reforms said.
The role of money power in the UP polls could be gauged from the fact that according to sources in Financial Intelligence Unit-India, in UP alone, unaccounted money worth Rs 500 crore was used during the 2014 Lok Sabha polls. Besides, there was a sudden rise in bank transactions across UP between September 2013 and April 2014—when the electioneering was at its peak. Of approximately Rs 300 crore seized, about one-sixth of the amount was from UP. In India, the system of political funding is absolutely opaque. According to an ADR report, most parties show bulk of their funding from donations given by small unnamed ‘benefactors’ with less than Rs 20,000 contribution each. Therefore, the parties don’t have to reveal their identity. The percentage of such unnamed contributors was over 90 per cent in case of the BSP.
The upcoming UP polls are one of the most eagerly awaited as it will set the tone for the 2019 general elections. No wonder, both the SP and BSP have prepared a war chest of Rs 500 crore each, according to their own submission to the election commission by August this year. The BJP, spearhead by their national chief and the Congress helmed by their heir apparent Rahul Gandhi, clearly, would be no less prepared. But how much will they be able to spend openly has to be seen.
“As per the ADR report, the BJP and BSP has maximum candidates with money power. With this development, parties will have to fix the limit somewhere. The demonetisation will certainly affect poll expenses but the dimension of impact will depend largely on the financial strength of the candidates in fray,” said Sudhir Panwar, a farmer leader and social activist.
As per the expenditure limit set by the election commission, a candidate can’t spend more than Rs 70 lakh in Lok Sabha election and Rs 28 lakh in case of Vidhan Sabha polls. Going by the opulence and populist measures adopted by vote-seekers—from saris to hard cash—this limit is clearly observed only in exceptional cases.
According to EC sources, over 2,200 accounts of candidates and their associates were under observations during the 2014 elections for their unusually high transactions. Arvind Mohan, a Lucknow-based economist said, “At present the currency circulation is to the tune of Rs 18 lakh crore of which around Rs 13.5 lakh crore roughly is Rs 500 and Rs 1,000 denomination notes. Large chunk of black money is kept in the form of cash with majority of Rs 500 and Rs 1,000 currency notes. Now this demonetisation will certainly dent the planned expenditure by the candidates. It will take away the sheen and shine of elections this time.”