Not only has there been a rise of a significant 160 % in donations above Rs 20,000, from big business to political parties between 2004 and 2018, but it is BJP that has received the highest donations from corporates (94%) while CPI received the lowest (2%) in FY 2016-17 and 2017-18. The total amount received by the BJP in FY 2016-17 and 2017-18 is the highest at Rs 915.596 cr, which forms 94% of the total donations to the party above Rs 20,000.
The Association for Democratic Reforms (ADR), a non-partisan NGO working in the area of political and electoral reforms has released a report analysing the donations received by six major national political parties in the year 2016-17 and 2017-18 from corporate/business houses. The report titled ‘Analysis of Donations from Corporates & Business Houses to National Parties for FY 2016-17 & 2017-18’ analyses the sources, the type, the mode and the quantum of donations received by BharatiyaJanata Party (BJP), Indian National Congress (INC), Nationalist Congress Party (NCP), Communist Party of India (CPI), Communist Party of India-Marxist (CPM) and All India Trinamool Congress (AITC) in the two financial years (FY) preceding the election year. The report accounts for donation above Rs. 20,000 as political parties are required to submit details of only such donations to the Election Commission of India (ECI).
Major Findings:
- The report reveals that there has been a rise by 160% in donations above Rs.20,000 to national parties from corporates/business houses from 2004-12 to 2016-18.
- Parties received Rs. 378.89 cr in the period 2004-2012 and Rs. 985.18 cr in 2016-2018 alone.
- Between FY 2012-13 and 2017-18, donations from corporates to national parties increased by 414%, with a major drop in the percentage of corporate donations in FY 2015-16. The highest donations were in the FY 2014-15, during which the LokSabha elections were held.
- 93% of the total contribution to political parties from known sources came from corporates.
- BJP received the highest donations from corporates (94%) while CPI received the lowest (2%) in FY 2016-17 and 2017-18.
- Top three states from where maximum corporate donations were received, in FY 2016-17 & 2017-18, were Delhi (Rs 481.37 cr = 48.86%), Maharashtra (Rs 176.88 cr = 17.95%) and Karnataka (Rs 43.184 cr = 4.38%).
Party-Wise corporate donations:
- In FY 2016-17 and 2017-18, the 6 National Parties received a total of Rs 1059.25 cr via voluntary contributions above Rs 20,000 out of which Rs 985.18 cr (93%) was from corporates/ business houses alone.
- In FY 2016-17 & 2017-18, a total of 2061 corporate donations were received by national parties.
- The maximum number of donations were received by BJP, followed by INC, CPM, NCP, CPI and AITC.
- BJP declared receiving more than five times the total corporate donations (1731 donations) received by the rest of the 5 National Parties combined (330 donations) during the FY 2016-17 and 2017-18.
- BJP received the maximum donations of Rs 915.596 cr, which forms 94% of the total donations to the party above Rs 20,000 in FY 2016-17 and 2017-18.
- Between FY 2012-13 and 2017-18, BJP received the maximum corporate donations of Rs 1621.40 cr, constituting 83.49% of the total corporate donations in the six years
- INC declared a donation of Rs 55.36 cr (81%) from various corporate and business houses.
- CPI received the least amount of donations from the corporate sector, receiving a total of only Rs 4 lakhs (2%) from 7 donations.
- BSP has stated that the party received no donations above Rs 20,000 from any donor in FY 2016-17 and 2017-18.
The following tables give a brief of the amount and percentage of corporate donations received by national parties.
Categories of corporate donors:
The ADR report divides the corporate donations into 15 categories which includes Electoral Trusts, Manufacturing Companies, Real Estate, Power and Oil among others.
- Of the 985.18 cr corporate donations received between FY 2016-17 and 2017-18, Rs. 488.42 cr (49.58%) was received from Electoral trusts followed by Manufacturing companies (Rs. 120 cr = 12.18%), Real Estate (Rs. 90.57 cr = 9.19%) and the least was received from Education firms (Rs. 0.67cr = 0.07%).
- Further, Rs. 22.59cr (2.29%) was received from the unsegregated category, which includes companies with no details available online or those with no clarity regarding the nature of their work.
- The top 10 corporate donors in FY 2016-17 and 2017-18, led by Prudent/Satya Electoral Trust, gave donations to BJP with only 3 of them giving it to INC.
Mode of donations:
ADR report comprises of four modes of donations- Cheque/DD, Bank transfer, Cash and Incomplete and Undeclared sources.
- Overall, highest amount has been received through Cheque/DD (Rs 786.603 cr = 79.84%), followed by Bank Transfer (Rs 175.764 cr = 17.84%).
- Mode of payment is either incomplete or undeclared in case for 211 donations through which National Parties received Rs 22.81 cr, which forms 2.32% of the total amount of donations received by corporate/business houses.
- 52.96% (Rs 12.08 cr) of the total donations with Incomplete and undeclared mode of payment have been received by the INC alone while 124 donations or Rs 8.066 cr of the total donations with Incomplete or undeclared mode of payment was received by the BJP.
- 100% of corporate donations to AITC either have incomplete or undeclared mode of payment.
- A total of 916 donations through which National Parties received Rs 120.14 cr do not have address details in the contribution form.
- 98.77% of such donations worth Rs 118.66 cr without address details belong to the BJP.
- In case of 84 donations through which Rs 2.55 cr have been received, there is neither PAN detail, nor address is available.
- 98% of such donations worth Rs 2.50 cr without PAN and address details belong to the BJP.
- Overall, there were a total of 20 donations declared by National Parties in which there was absolutely no information related to PAN, address and incomplete details of the mode of payment of donations.
Recommendations of ADR
1. The Supreme Court gave a judgment on September 13, 2013, declaring that no part of a candidate affidavit should be left blank. Similarly, no part of the Form 24A submitted by political parties providing details of donations above Rs20,000, should be blank.
2. All donors who have donated a minimum of Rs 20,000 as a single or multiple donations should provide their PAN details.
3. Date on which the donation was made should be recorded by the party and submitted in Form 24A.
4. Any party which does not submit its donation statement to the ECI on or before 31st Oct should be heavily penalized and its income should not be tax-exempted.
5. A total of Rs 2.55 cr was collected by the National Parties from 84 corporate donors without obtaining their PAN and Address details. Such incomplete contributions reports must be returned to the parties by the ECI, to deter them from providing incomplete information.
6. Corporates should make details of their political contributions available in the public domain through their websites (in annual reports or in a dedicated page) for increasing transparency in political financing.
7. Annual scrutiny of donations reports of National, Regional and unrecognized parties should be initiated by a dedicated department of the CBDT, to discourage donations from shell companies or illegal entities.
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