Google trend - Electoral Bonds

Electoral bonds are a financial instrument introduced in India in 2018 to provide a transparent and accountable mechanism for political funding. They were introduced as an alternative to cash donations, which were often untraceable and prone to corruption.

Electoral bonds are essentially a form of promissory note that can be purchased by any individual or corporate entity from authorized banks. These bonds can then be donated to registered political parties, who can encash them and use the funds for their political activities. The bonds are available in fixed denominations ranging from 1,000 to 1 crore Indian rupees.

One of the key features of electoral bonds is the anonymity they provide to the donor. The bonds do not carry the name of the donor, ensuring that the identity of the donor remains confidential. This was done to encourage more people to donate to political parties without fear of retribution or harassment.

To purchase electoral bonds, individuals or entities need to provide their KYC (Know Your Customer) details to the authorized banks. This ensures that only legitimate and verified individuals or entities can purchase the bonds. The bonds can be bought during specific periods designated by the government, usually in the months of January, April, July, and October.

The bonds can only be encashed by registered political parties within a specified time period. The bonds are valid for 15 days from the date of issue, and if not encashed within this period, they become invalid. This ensures that the funds are utilized within a reasonable time frame and are not hoarded by political parties.

One of the criticisms of electoral bonds is that they lack transparency. Since the identity of the donor is not disclosed, it becomes difficult to track the source of funds and identify any potential illegal or corrupt practices. This has raised concerns about the potential for black money to be funneled into political parties through these bonds.

Another criticism is that electoral bonds favor the ruling party or those with significant financial resources. The bonds can only be purchased from authorized banks, and the list of authorized banks is limited. This restricts the access to electoral bonds for smaller political parties or those without strong financial backing.

Despite these criticisms, the government has argued that electoral bonds promote transparency and accountability in political funding. They argue that the bonds are a step towards reducing cash donations, which were often unaccounted for and prone to corruption. The government has also stated that the electoral bond scheme is a work in progress and that they are open to making necessary changes to address any concerns or loopholes.

In conclusion, electoral bonds are a financial instrument introduced in India to provide a transparent and accountable mechanism for political funding. They allow individuals and entities to donate funds to political parties without revealing their identity. While they have been criticized for lacking transparency and favoring certain parties, the government maintains that they are a step towards reducing cash donations and promoting accountability in political funding.