Electoral funding in India is fraught with the double whammy of legal loopholes and political inefficiencies. In this context, discuss the challenges to electoral funding. What lessons can India draw from global best practices in this regard?

Challenges

1. Black Money: finds its way into exchequers of political parties.

2. Rent seeking: corporate entities may fund political campaigns for future quid pro quo leading to elite capture and crony capitalism.

3. Lack of Transparency: regarding the sources of funding for political parties as RTI is not applicable to parties.

4. Absence of a legal framework: to regulate donors and political parties.

5. Political Apathy: due to vested interests leads to lack of reforms to address the above issues.

Global best practices

(1) Germany: uses state funding of elections model.

advantages {

• level playing field for all parties
• transparency
• limits on expenditure. }

(2) USA: uses democracy vouchers for local elections in Seattle.

advantages {

• regulatory mechanism
• transparency
• secrecy for donors. }

(3) Chile: uses the reserved contribution system.

advantages {

• anonymity
• ↓ scope for rent seeking
• regulations. }

(4) UK: has put in curbs for spending thresholds for both parties & candidates. advantages {

• wasteful spending ↓
• transparency.