Budget on Political Funding Reforms

The union budget presented by Finance Minister Arun Jaitley on 1 February included proposed reforms in the funding of political parties titled “Transparency in Electoral Funding.” The budget, while promising transparency and accountability in political funding, does not answer questions on how it would be implemented at the ground level nor has it promised implementation of related reforms proposed by the Election Commission of India (ECI) and the Law Commission of India. The budget fails to address the issues of transparency, disclosure, and penalties with respect to political parties.

Of the four main suggestions, the first and second touched upon the “suggestion by the Election Commission, the maximum amount of cash donation that a political party can receive will be ₹2,000 from one person” and that “political parties will be entitled to receive donations in cheque or digital mode from their donors.” This proposal to limit cash donations to ₹2,000 is flawed on three counts.