PMO broke own law

This week, we launched #PaisaPolitics, our exclusive investigation into how the Narendra Modi-led BJP government ignored institutional opposition, lied to Parliament and broke its own rules in its push to introduce electoral bonds — an opaque instrument that allows donors to give unlimited money to political parties anonymously — in India.

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The three stories (until now), written by senior journalist Nithin Sethi, have exposed how the government, in its haste to bring in a secretive source of political funding to the country, ignored institutional checks and balances and weakened the foundations of a transparent electoral democracy.

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In the latest part of the series, published today, Sethi found that Prime Minister’s Narendra Modi’s office ordered an illegal sale of electoral bonds right before crucial state assembly elections.

So what really happened here?

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Just a couple of months after the rules for electoral bonds were notified, the Prime Minister’s Office ordered the finance ministry to break those same rules to open a special window before the 2018 Karnataka assembly election. Why is this illegal? According to the rules, State Bank of India can sell electoral bonds only in four 10-day windows in one year.

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Only in general election years (like 2019) can the bonds be sold for 30 additional days.After the PMO's instructions came in, a finance ministry, Vijay Kumar, wrote to his seniors, pointing out that the rules didn't allow for a special window in May, as there was no Lok Sabha election scheduled for 2018. But did this mean he stood his ground and refused to consider it? Nope. Instead, Kumar said that “the problem perhaps lay with the rules rather than with the PMO, and so suggested the rules be changed”. S.C. Garg, then secretary for economic affairs, shot down the idea, saying "If we were to open a special window for assembly elections as well, there will be several special windows". But as soon as Kumar wrote on 11 April 2018 that it was the PMO that wanted this, Garg changed his tune. The same day, he wrote to Finance Minister Arun Jaitley, "in view of the requirement", and the latter signed off on the exception.Except it wasn't an exception: this incident was used as precedence to open a special window to sell electoral bonds in November 2018, ahead of vital assembly elections in 5 states. Rs 184 crore worth of electoral bonds were bought by donors from SBI in this phase.

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Read why the RBI and the Election Commission strongly opposed electoral bonds.

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What’s next?

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The Congress held a press conference on Wednesday, demanding that the government disclose all details about the controversial scheme in Parliament. There has been no official response from the government yet to the story—the PMO refused to comment.

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Watch out for Part 4 of #PaisaPolitics on https://www.huffingtonpost.in/ tomorrow