In the period following the scrapping of the electoral bonds scheme, corporate trusts emerged as a major source of political funding, donating a total of Rs 3,811 crore to various political parties, according to disclosures and election funding records.
The figures highlight how political financing has shifted routes rather than diminished after the Supreme Court struck down the electoral bonds framework, citing concerns over transparency and voters’ right to information.
Who are corporate trusts?
Corporate trusts are entities created by companies or groups of companies to manage donations and charitable contributions. While legal, these trusts often act as intermediaries, making it harder to trace the original corporate source of funds unless detailed disclosures are made.
Unlike electoral bonds, which ensured donor anonymity, trust donations are routed through banking channels and are subject to reporting requirements — though critics argue that opacity still remains.
Why the shift happened
After electoral bonds were scrapped:
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Companies lost a confidential, bond-based donation route
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Political parties needed alternative funding mechanisms
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Corporate trusts offered a structured, compliant channel
As a result, many firms appear to have consolidated political donations through trusts rather than donating directly.
Who received the funds
Multiple national and regional parties benefited from trust donations, with the bulk of the money reportedly flowing to major political players. Analysts say established parties with strong organisational networks were better positioned to attract such funds.
Smaller parties, meanwhile, continued to rely more heavily on individual contributions and local fundraising.
Transparency concerns persist
While trust donations are technically more transparent than electoral bonds, activists argue that:
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Trusts can still mask donor identities
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Consolidated donations blur accountability
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Voters may struggle to link policies with funding sources
They have called for tighter disclosure norms, including mandatory publication of the ultimate corporate donors behind trusts.
Political response
Political parties have defended trust-based funding as lawful and necessary for campaign operations, pointing out that elections are expensive and require sustained financial support. They also argue that donations through trusts are already subject to existing legal safeguards.
What this means for electoral funding
The Rs 3,811 crore figure underscores a broader reality: ending one funding mechanism does not automatically curb the flow of corporate money into politics — it often reshapes how that money moves.
As India debates reforms to political funding, the role of corporate trusts is likely to come under sharper scrutiny, especially ahead of future elections.
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