What is Prudent Electoral Trust, which distributes donations to political parties? Where does the money come from, who runs it?

New Delhi. 15 February 2024 became a decisive date in the history of Indian politics and election funding. On this day, the Supreme Court had ordered the closure of the Electoral Bond Scheme, terming it unconstitutional. The court clearly said that in a democracy, transparency and not secrecy of donations is necessary. But the latest data is that an estimated donation of Rs 2,668 crore has been distributed in 2024-25, out of which only Rs 2,180 crore has been received by BJP, Rs 216 crore has gone to the account of Congress. Now that the Electoral Bond Scheme has been closed, then where are these donations coming from, through which route, who is deciding how much funds will be given to which political party?

The answer to the biggest question is Prudent Electoral Trust. This is India’s most influential and wealthy electoral trust, which has been working as a bridge between the corporate world and politics since 2013, not after 2024. This trust was started in 2013 by Bharti Enterprises (parent company of Airtel) under the name ‘Satya Electoral Trust’. In 2014, its name was changed to Prudent Electoral Trust. The trust is registered as a company under Section 8 (Non-Profit) of the Companies Act and operates under the Electoral Trust Scheme approved by the Central Board of Direct Taxes (CBDT).

When the chapter of electoral bonds has been closed, prudent electoral trust has become even more important for political parties. The question is not just about money, but about the path through which money reaches the government and the opposition. To whom has this Trust donated so much since 2013, which corporate houses have played a role in it, and how does its functioning affect democracy? The answers to all these questions are given below-

Who runs Prudent Electoral Trust? Where does the donation come from?

Presently it is run by independent professionals and auditors. The current shareholders and directors (who act as trustees) of the trust are Mukul Anand Goyal and Ganesh V. Venkatachalam.

Both of them have been directors since 2014. Originally Bharti Group executives were involved, but later some shareholders were transferred to make it appear independent. Even after this, its actual control is still considered to be with Bharti Group.

How does this trust operate?

The trust collects donations from corporates and individuals. In the Electoral Bond Scheme, companies or individuals used to give funds directly to political parties, but here, instead of donating directly to political parties, companies deposit funds in this trust. The Trust has to distribute at least 95 percent of the total donations received in a financial year to political parties in the same year. This is a mandatory rule.

Prudent Trust has to submit its Contribution Report to the Election Commission (ECI) every year. In this, there is a complete account of the name of the donor and how much money was given to which party. The identity of the donors is made public in the trust report, but the information about the amount of donation given by each donor remains confidential.

The funds collected are distributed among political parties. It is mainly decided based on the wishes of the donors or the decision of the trust as to how much fund is to be given to which political party. If we talk about rough figures, Prudent has historically given about 80 percent of its funds to the Bharatiya Janata Party (BJP).

Its major donors in 2024-25 have been companies like Bharti Airtel, DLF, Hero MotoCorp, Jubilant Foodworks, JK Tyre, Indiabulls, Orient Cement and Megha Engineering.

Which party received how much funds in which year?

Since 2013, Prudent Trust has raised donations of more than Rs 5,000 crore. To which parties has this donation gone? Data for key years based on ADR (Association for Democratic Reforms) and Election Commission reports is given below-