Source: AFP
Huge donations from companies under criminal investigation or suspected of being shell companies have flowed to India’s ruling BJP and other parties, new evidence showed, underscoring ties between corporate titans and the government.
Last week, India’s election commission published a list detailing the buyers of electoral bonds, a controversial financing scheme that has helped Prime Minister Narendra Modi’s party create a massive war of campaign rivals.
Electoral bonds account for more than half of all political donations and were anonymous until India’s top court ruled them illegal weeks before the start of national elections next month.
A review of the list by AFP found that of the $1.5 billion donated through the system, at least $94 million was given by 17 companies after facing – either directly or through their subsidiaries – investigations into tax evasion, fraud or other corporate misconduct. abuse.
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“The electoral bond scheme was sinful in conception, flawed in design and aimed at preventing transparency,” opposition Congress MP Abhishek Singhvi told AFP.
“Every one of these vices is exposed… by the huge revelations that fall out of the closets.”
“They knocked on their doors”
Opposition lawmakers claim the electoral bond list shows companies donated to Modi’s ruling Bharatiya Janata Party (BJP) in the hope of influencing the outcome of criminal investigations.
The BJP was by far the largest beneficiary of the program, receiving $730 million or about 47% of all bonds redeemed since April 2019.
The main congressional competitor received about $171 million over the same period.
Among the companies named as donors is Hero MotoCorp, the country’s largest motorcycle maker by sales. He donated $2.4 million to the BJP seven months after confirming his finances were being investigated by the tax department.
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Glenmark Pharmaceuticals, a leading pharmaceutical company, bought $1.17 million worth of electoral bonds for the BJP eight months after Indian media reported an investigation into alleged tax evasion.
Indian miner Vedanta, whose parent company was once listed on the London Stock Exchange, has donated more than $40 million to half a dozen parties over the past five years.
Source: AFP
Local media reported in 2022 that the country’s main financial crime agency began investigating the company in 2018 over alleged bribery to facilitate visas to India for Chinese technicians.
Hero, Glenmark and Vedanta did not respond to requests for comment.
No conclusive evidence of such a quid pro quo has emerged. Authorities have also not publicly announced whether investigations into sponsoring companies have been closed or dropped.
Source: AFP
Nirmala Sitharaman, Modi’s finance minister, said last week that any allegation of a link between criminal investigations and political donations was based on “huge assumptions”.
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“What if the companies gave the money and after that, we went and knocked on their doors?” he said at a panel hosted by the India Today TV channel.
The BJP was not the only party to receive electoral bonds from companies facing legal probe.
Among the many parties funded by lottery company Future Gaming — the largest single donor under the $164 million program — were the government and opposition of the southern state of Tamil Nadu.
Future Gaming has been the subject of several investigations since 2011 on suspicion of unpaid income tax, money laundering and fraud, according to media reports.
“black money”
Ties between corporate India and the country’s political class have previously erupted in public scandal — including to the benefit of Modi, who came to power a decade ago on a wave of public discontent over corruption.
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Modi has made hay from a series of corporate bribery charges leveled against his opponents, including allegations that ministers and bureaucrats had taken money from telecom companies in exchange for favorable licensing deals.
His government introduced electoral bonds in 2017, pledging the scheme would clean up illegal “black money” donated to parties in exchange for political favours.
But the new plan did not close other funding avenues, including anonymous cash donations or discount election trusts in which many companies can raise money for parties without public scrutiny.
Indian media also found several other irregularities with the electoral bond system, reporting that several companies donated amounts far in excess of their annual profits or revenues.
Others were unprofitable or newly incorporated, suggesting they had been used as front companies to make donations on behalf of an unidentified third party.
Milan Vaishnav, of the Carnegie Endowment for International Peace, said the list of donations vindicated the electoral commission’s objections to the plan when it was first introduced.
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“This is exactly what the EC had warned, (that) the creation of this opaque instrument could allow shell companies, foreign companies and unknown third parties to give to parties without detection or external control.”
Source: AFP