Electoral bonds would be a bearer instrument in the nature of a promissory note and an interest-free banking instrument. A citizen of India or a body incorporated in India will be eligible to purchase the bond.
The electoral bonds which will be issued by notified banks can be redeemed by recognised political parties within a prescribed time limit. Electoral bonds are more to do with eliminating black money and less to do with electoral reforms.
- Electoral bonds make electoral funding even more opaque. It will bring more and more black money into the political system.
- Analysts said the move could be misused, given the lack of disclosure requirements for individuals purchasing electoral bonds.
- With electoral bonds there can be a legal channel for companies to round-trip their tax haven cash to a political party.
- As for political parties, they no longer need to reveal the donor’s name for contributions above ₹20,000, provided these are in the form of electoral bonds. So a foreign company can anonymously donate unlimited sums to an Indian political party without the Election Commission or the IT department ever getting to know.
- The requirement for a company to have been in existence for three years (paving the way for fly-by-night shell companies) is also removed.
- Formation of National Electoral Fund to which all donors can contribute. The funds would be allocated to political parties in proportion to the votes they get. Not only would this protect the identity of donors, it would also weed out black money from political funding. (Recommended by Former Chief Election Commissioner S.Y. Quraishi)
- Meghalaya way of conducting election- Meghalaya follows some of the best practices to lessen the money power in election. For instance, common stage to be used by every political parties in different time slots.
- The best way to bring about such transparency in political funding is to put a complete ban on cash donations by individuals or companies to political parties.
- State funding of election as specified by Indrajit Gupta committee, which will create equal level playing field for all political parties.
- Make it mandatory for political parties to submit details of all donations received with the Election Commission and also with the income-tax department.