India SC scraps opaque election funding system

India's Supreme Court yesterday scrapped a seven-year-old election funding system that allows individuals and companies to donate money to political parties anonymously and without any limits, calling it "unconstitutional".  The decision is seen as a setback for Prime Minister Narendra Modi's Bharatiya Janata Party, which has been the largest beneficiary of the system it introduced in 2017. The system, called Electoral Bonds, was challenged by opposition members and a civil society group on grounds that it hindered the public's right to know who had given money to political parties. Under the system, a person or company can buy bonds from the state-run State Bank of India SBI.NS and donate them to a political party. Undeclared individuals and companies bought 165.18 billion rupees of such bonds up to November 2023, according to the Association for Democratic Reforms, a civil society group working on election funding in India. The group was a petitioner challenging the system. A five-judge bench headed by Chief Justice D Y Chandrachud said: "Political contributions give a seat at the table to the contributor... this access also translates into influence over policy making." Because of the close nexus between money and politics it is possible that financial contributions "would lead to quid pro quo arrangements", the court said.