Prime Minister Narendra Modi has asked BJP MPs and MLAs to submit their bank statements with details of transactions between November 8 and December 31 to party president Amit Shah. The decision comes in the wake of Opposition leaders asking the BJP to walk the talk on black money and many analysts pointing out that a lot of the illegal money in the economy is linked to political financing. Until elections are cleaned up, party accounts become transparent and political spending becomes cashless, Mr Modi’s own drive against black money will be incomplete. In that sense, the PM’s decision to start with the BJP shows good intentions. It also shows he is willing to address some of the deeper structural issues at the heart of black economy.
However, while intentions are laudable, the move does not go far enough. For one, the PM has instructed that the bank details be submitted to the party president. This means that the exercise will remain an internal housekeeping issue; there are no independent, external checks on any discrepancy. It is but natural that the incentive of the party would be in protecting, rather than punishing the wrongdoers.
To make it more credible, an external auditor should be included. Two, as the Opposition has pointed out, the timeline is limited to November and December. One can understand that the PM is linking it to demonetisation, based on the assumption that politicians with cash would have deposited money in this period. But to allay apprehensions that some of them knew about the move, it would be even better if the timeline could be extended to say all of 2016. And finally, most politicians do not leave a paper trail and deposit money in their own accounts - it could be in the accounts of their relatives, aides and other business associates. So the exercise may not give us an accurate picture of the black wealth that is at the disposal of many BJP politicians.
But PM Modi’s move has brought back much needed attention to the fact that Indian politicians probably have more per capita black money in some form or the other than in most evolved democracies. Making party accounts more transparent, insisting only on cheque and e-transactions, reforming political donation laws, making the disclosure of contributors compulsory, enforcing limits on election expenditure not just for the candidate but also the party are only some of the steps that need to be taken in this exercise. Mere tokenism at the level of the party may help the PM build an image of a clean strong crusader but will not solve the problem.