How India undermined its elections: why was the world’s largest democracy outperformed by one of the smallest?

By Dr. Zaad Mahmood

The 2014 Indian parliamentary election was a historic achievement for the world’s largest democracy. The elections led to an alternation of government and a majority for a single party - the right wing Bhartiya Janata Party - after 3 decades of fragmented electoral outcomes. The polls constituted the biggest election recorded in history with 815 million eligible voters (more than the population of USA and EU together) across roughly one million polling stations (Election Commission of India Various Issues). The logistical requirements were colossal. Over 8 million security forces, 10 million poll workers and 15,000 litres of indelible ink had to be brought to bear (Burke 2014, Badkar 2014). It was estimated by the Centre for Media Studies that the projected cost for the entire election was to be around US$ 5 billion, just second to the US$ 7 billion American Elections of 2012 (Ghosh 2014).

But why is it, that despite the enormous logistical and financial efforts, serious concerns remain about the substantive fairness of elections in India? As the recently released Perceptions of Electoral Integrity (PEI) data suggests, Bhutan – India’s tiny neighbour to the North – outdid the world’s largest democracy in terms of overall electoral integrity (Norris et al. 2015). This is all the more surprising since India can look back on several decades of competitive elections, while Bhutan only started experimenting with multi-party democracy in 2008. The simple question is ‘What went wrong in India’s election’?

Electoral Integrity in South Asia

The Perceptions of Electoral Integrity (PEI) Index developed by the Electoral Integrity Project at Harvard University and University of Sydney provides data to answer this question. It gives an assessment of the quality of elections through expert evaluations. The latest PEI Index (Version 3.5) provides a comparative assessment of all the elections held between 2012 and 2015 for 153 elections across 125 countries (Norris et al. 2015). The index is constructed of 11 different dimensions that are most relevant and critical for elections, namely Election Laws, Constituency Boundaries, Party and Candidate Registration, Campaign Finance, Vote Count, Election Procedure, Campaign Media, Voter Registration, Voting Process, Result transmission and Election Management Bodies (Norris, Frank, and Coma 2014, Norris 2013).

As the index suggests, compared globally, the Indian election ranks above the global average of all elections. However surprisingly Bhutan, a relatively new democracy, outscores India in terms of electoral integrity to have the best elections in South Asia.



Figure 1: Electoral Integrity in South Asia (2012-2015)

As shown in Figure 1, electoral integrity varies across South Asia. Bhutan has the best perception of Electoral Integrity followed by India and Maldives. Bangladesh is the clear laggard in terms of electoral integrity along with Pakistan. The position of Nepal and Sri Lanka are somewhat intermediate in the region even though globally they are below the mean score of PEI.

The PEI Index allows looking in more detail at the electoral cycle to identify problem areas. The overall PEI Index can be divided into eleven sub-dimensions. A comparative analysis of these PEI sub-dimensions suggests that voter registration, media access and campaign finance are key areas, which require improvement despite impressive electoral institutions and procedure in India (laws, election management body, vote counting, result declaration process, election process, party registration).

Table 2 shows a direct comparison of India and Bhutan along the eleven sub-dimensions. Evident from the data is the favourable standing of India in terms of Election Management Bodies, Laws, Electoral procedures, Counting and Result declaration and Party Registration. On most counts the position of India is higher than South Asian as well as Global Mean scores. Most of these issues are under the purview of the Election Commission, which is perhaps the most efficient public body in the country. Even Voting and Voter Registration which clearly require improvement have seen innovation and conscious effort by the Commission (recent online voter list). 

PEI sub-dimension	India	Bhutan	South Asia Mean	Global Mean
Election laws	71.53	52.31	61.92	54.30
EMB	76.33	74.23	75.28	60.95
voting	53.40	57.03	55.21	53.67
counting	72.10	65.45	68.78	68.31
results	67.03	69.32	68.17	64.92
procedures	71.88	74.66	73.27	65.90
voteregistration	40.03	45.38	42.71	51.27
boundaries	58.37	60.11	59.24	53.06
partyregistration	57.21	45.59	51.40	57.53
Media access	55.00	66.09	60.55	47.18
Campaign finance	32.92	55.45	44.19	36.63

Table 1: Electoral Integrity in India and Bhutan compared

However, as Table 2 clearly highlights campaign finance and campaign media as the two areas in which India falls short significantly.

Campaign finance and voter buying
The issue of campaign finance is crucial as it has the ability to undermine equitable party competition, transparency, accountability, inclusive participation, and public confidence in the integrity of the political process. Control of campaign finances by special interests and private entities may have broader ramifications such as damaging the delivery of public services and hurting prospects for economic growth (Norris, Abel van Es, and Fennis 2015).

Despite the enormous progress in ensuring free and fair elections campaign finance remains India’s Achilles heel. Vote buying vitiates political competition and introduces perverse incentives for voters as well as candidates.

Campaign finance was a part of election debate in 2014 as some of the political parties, election monitoring organisations and media repeatedly raised the issue of black or unaccounted money being used to influence voters. The Aam Aadmi Party, a civil society turned political outfit attacked other political parties during elections on the issue of funds (Bagri 2014). The media also played a proactive role in highlighting the role of black money. Consider the harsh review of Indian elections by James Tapper (Tapper 2015), ‘election officials seized 22.5 million litress of illegal alcohol, $52 million in cash and even 400,000 pounds of marijuana and heroin — all used to entice votes…..investigating a further 3,553 allegations that candidates paid newspapers and TV channels to give them positive coverage….” Media and News reports during elections such as, India election: 'Andhra Pradesh leads in vote-buying with $4.97B' (Gulf News, April 20, 2014), Black Money Power (A.T 2014), ‘Cash for votes a way of political life in South India’ (The Hindu, Mar 16, 2011) or ‘India's Election Problem: Votes for Sale (Wall Street Journal, 2014) are replete with news of vote buying.

The impact of voter buying is not limited to specific constituencies or election period but has wider ramifications. In an interesting study by Assocham, a leading busines organisation, it was found that elections had a strong multiplier effect on the Indian economy as parties ‘open their war chests for the investments’ (Choudhury 2014). The expenditure on elections is considered investment, which will yield rich dividends if elected in the form of patronage and future political investment. Devesh Kapur and Milan Vaishnav (Kapur and Vaishnav 2011) have shown that elections in India have a negative impact on the balance sheet of real estate sector. They argue builders often help politicians launder funds, which are then pumped back in at election time and the loss of liquidity causes a temporary downturn in demand for raw materials in the construction industry. Naturally such a distorted electoral incentive leads to institutional nexus between shady business and politics and unfavourable developmental outcomes. A World Bank research has found that prevalence of vote-buying, the direct exchange of “gifts” or money for political support during elections is inversely related to governments investment in pro-poor services (Khemani 2013).

Media regulation

The issue of campaign finance is also related to another weakness of Indian elections namely access to media. The 2014 election has been considered India’s first media election where media (social as well as mainstream) played a pivotal role in political communication. In terms of media access skewed financial resources has implications for level playing field and voter reachout. As Ghosal and Balachandran (Ghoshal and Balachandran 2015) show, the BJP and Congress party spent $115 million and $83 million on election campaign. The campaign expenditure for the BJP alone in 2014 was equal to the combined expenditure of the two parties in 2009 elections. The inflow of big money in campaign in an intensely competitive media market has implications for media access for the political parties. Researchers at CMS Media Lab, an independent, non-partisan media research organisation, found that Mr. Modi of BJP got 33.21 per cent, of the prime-time news telecast followed by Aam Aadmi Party leader Arvind Kejriwal at 10.31 per cent while Rahul Gandhi of Congress came a distant third at 4.33 per cent of news time (Rukmini S. 2014).

What can be done?

Given the serious maladies associated with campaign finance in elections the regulation and control of finance is the most crucial challenge ahead for free and fair elections. The issue for India is not merely regulation of campaign finance for parties but also the use of black money in elections.

The regulation of campaign finance through appropriate legal frameworks and procedures is a challenge for any countries. As Pippa Norris et al (Norris, Es, and Fennis 2015) point out, the most popular campaign finance reforms have been to strengthen disclosure requirements and to establish and/or expand public funding and subsidies to parliamentary parties. Given the complexity and gravity of the issue the Election Commission of India, which is constitutionally mandated to oversee elections has proceeded along the same steps. The typical intervention by the Commission has been in the form of candidate spending limits, disclosure and policing of illegal funds. Recently two key regulations have been implemented, namely candidate affidavit regime requiring political candidates to disclose their criminal, educational and financial details and Election and Other Related Laws Amendment Act, which incentivised transparency for donors by making party contributions 100% tax-deductible, and mandating disclosure of large political contributions (Norris, Es, and Fennis 2015).

However the measures adopted are inadequate as revealed by the PEI index. Even the Election Commission of India recognised the increasing currency of black money for elections but efforts to curb it have been very limited (PTI 2014).

A very promising development in cleaning election funds has been the Right to Information Act passed in 2005. The act, part of access to information movement, obliges public authority to provide requested information to citizens. As Sridharan and Vaishnav point out Court judgment in 2008 based on RTI Act compelling parties to publicly release their income and expenditure records will go a long way in cleaning elections (Norris, Es, and Fennis 2015). Another important step has been the Supreme Court’s landmark judgement that gave Election Commission the power to disqualify candidates found guilty of providing inaccurate expenditure statements.

The issue of regulation of campaign finance cannot be regulated only at the level of electoral cycle. An important step in this regard would be to reform the tax regime in India. A significant linkage of relation between money and politics is the proliferation of black or unaccounted money, which is used to influence election. As such strict implementation of tax rules and constricting the scope of tax avoidance would go a long way in cleaning elections. The introduction of GST with broad tax base, if implemented properly, may alleviate the source of black money. Related to such tax reform a more direct intervention in tax rules for political parties and corporates can also be considered. As per the Companies Act in India corporations can have full deductions on political donations, not above 5 percent of average net profit subject to disclosure in accounts. Clearly some of the corporations find the quid-pro-quo of election financing and subsequent benefits more rewarding than tax benefits. As such removal of any threshold for donation and subsequent tax benefit may be considered. Likewise political parties in India, exempt from tax burden subject to certain conditions may be brought under tax bracket specifically for campaign expenditure. In Australia the campaign finance reform proposal is discussing a policy of tax deductibility of candidates and party election expenses, a thought worth considering in Indian elections.

A more direct intervention can be in the form of introduction of public funding of election. It would act to level the playing field for parties in election. However given the multiplicity of political parties and fragmented nature of Indian polity it is a difficult proposition (PTI 2014).

Finally it has to be recognised that cleaning campaign finance is part of much wider endeavor. The use of money in election is the outcome of nexus between business and politics. As the Indian economy liberalises resources hitherto under the government like mines, spectrum, and natural gas have opened up for the private sector leading to increased rent seeking and patronage politics. Sridharan and Vaishnav have argued that complete withdrawal of the state and relaince on market forces is necessary to put a stop to the system of policy and regulatory favors for payments and anonymous campaign donations (Norris, Es, and Fennis 2015). Another possible solution is the much touted lokpal or ombudsman with capacity of political oversight. Whatever the approach, the path to campaign finance reform remains complicated and difficult, but it is a path that Indian democracy must traverse to remain meaningful and accountable.

References

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