India Inc mulls options to end black money in elections | business | Hindustan Times
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India Inc mulls options to end black money in elections

With the general elections round the corner and allegations of Corporate India being harassed by political parties for funds flying thick and fast, leading lights of industry want an overhaul of the system to bring in transparency to political funding.

business Updated: Mar 27, 2009 22:29 IST
HT Correspondent
HT Correspondent
Hindustan Times

With the general elections round the corner and allegations of Corporate India being harassed by political parties for funds flying thick and fast, leading lights of industry want an overhaul of the system to bring in transparency to political funding.

Things came to a head on Thursday when at the Confederation of Indian Industry’s (CII) annual session, Tata Communications chairman Subodh Bhargava and Bajaj Auto’s chairman Rahul Bajaj moaned about black money flowing into elections – something that businessmen want to end.

“We have to address the root of the problem which is not the politicians or industrialists," Dr Amit Mitra, secretary-general Federation of Indian Chambers of Commerce and Industry, told Hindustan Times.

"We have to find ways on how to fund elections and how much can an individual donate. Either we go the US way (of capping corporate contributions) and adopt the latter or we look at the European model and allow elections to be completely funded by government."

A third option could be middle path between the two. Estimates suggest that elections cost between Rs 15,000 crore and Rs 20,000 crore.

The big question of course, is, how legislation can make sense in a system where funds are quietly given in off-book payments to politicos.

“As much as 60 per cent of companies are financing political parties in black money,” Bajaj said on Thursday.

Clean money can make a difference. Large coporate houses like Tatas and Birlas have separate electoral trusts of their own through which they provide monetary help to political parties.

The Tata Electoral Trust does not distribute funds to individual candidates but to registered political parties based on elected members to Lok Sabha.

"There obviously is a case for laying down procedures for funding as it is at the heart of our democracy," said the CEO of a top automobile company who requested anonymity. "While there is pressure on some companies there are others who fund as a means of doing because as they see returns if the supported party comes to power."