Facts for Prelims (FFP)
Source: IE
Context: Prior to the Electoral Bond Scheme, the Electoral Trusts (ET) Scheme, established by the UPA government in 2013, regulated corporate and individual donations to political parties, emphasizing transparency.
Electoral Trusts (ET) Scheme:
- Introduced in 2013.
- Open to companies registered under Section 25 of the Companies Act, 1956, and individuals or entities residing in India.
- Trusts must renew their registration every three financial years.
- Mandates that 95% of contributions received in a financial year must be donated to political parties registered under the Representation of the People Act, 1951.
- Electoral Trusts prioritize transparency by mandating the reporting of contributors and beneficiaries to the Election Commission of India. This differs from the Electoral Bonds (EB) Scheme, which permits anonymous political donations.
About the Electoral Bond Scheme:
What does the Trend Show?
Both EB and ET schemes are running simultaneously. In the period from 2017-18 to 2021-22, the money donated through EBs was over five times the amount that came through Electoral Trusts. Between the same period, parties received a total of Rs 1,631 crore through ETs, while Rs 9,208 crore was donated through EBs.
