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25 March 2017 Editorial


25 MARCH 2017

Cloak of invisibility

Well before financial year 2017-18 begins, the Lok Sabha has signed of on the Budget with the passage of the Finance Bill of 2017. It includes multiple amendments proposed by the government that did not figure in Arun Jaitley’s speech of February 1, either in letter or in spirit. For instance, while the speech devoted 420 words to proposed measures to improve transparency in electoral funding, amendments have been made to the Companies Act of 2013 that actually turn the clock back on existing disclosure standards. Till now, companies could only contribute up to 7.5% of their average net profits in the past three financial years to political parties. They were required to disclose in their profit and loss accounts the amount of contributions and the names of political parties to which they were made. The ceiling has now been dropped, paving the way for a firm to deploy unlimited capital into political cofers irrespective of its own financial and operational health. Companies would still have to reveal the extent of their financing of parties, but no longer have to name their preferred parties. For the sake of argument, one could say the 7.5% limit was arbitrary and restricted willing and able corporate donors’ ability to influence political activity. But doing away with the limit makes firms susceptible to funding ‘requests’ from local, regional or national political formations while taking away excuses — such as it being a loss-making unit, or breaching the funding cap.

This would open up new opportunities in crony capitalism. Pressure could be exerted on a company awaiting government clearances, or a loan restructuring from public or cooperative sector financiers. Even a publicly listed company can set up subsidiaries just to fund parties. This removes any pretence of transparency in the process as the donor will not have to disclose who he paid; the recipient has no such obligation either. It is not surprising that India Inc. has remained stoically silent so far. This abandonment of the 7.5% requisite comes in tandem with the proposal to float electoral bonds to give anonymity to political donors. The scheme for such ‘bearer’ bonds is still being worked out with the central bank, but how this will meet the objective of transparency isn’t clear yet. The push for cashless modes for political contributions sounds worthy, but reducing the Rs. 20,000 limit on cash donations to Rs. 2,000 does nothing to guarantee that monetary muscle power will dissipate from electoral processes. Instead of, say, a lakh of such donors, a party can now share 10 lakh random names to justify cash holdings. Transparency is not synonymous with anonymous transactions, unlimited corporate donations, relaxed disclosure norms and the persistence of cash. The Budget’s promise of “reform to bring about greater transparency and accountability in political funding, while preventing future generation of black money”, truly rings hollow.

Terror in London

The attack in London’s Westminster that left five persons dead, including the assailant, was the type of terror strike that British security officials have been expecting. For almost three years, the threat level from international terrorism in Britain has been “severe”, meaning an attack is deemed highly likely. This incident was different from a conventional terror strike, but bore similarity to attacks on European cities in recent years claimed by the Islamic State. As the Berlin and Nice assailants did last year, the London attacker, Khalid Masood, turned a vehicle into a lethal weapon by mowing down pedestrians on Westminster Bridge and later killed a police officer with a kitchen knife at the Parliament compound. Britain has one of the best counter-terror police and intelligence agencies in Europe. Since the 2005 London bombings, the country has remained largely safe. In the last four years, British officials have reportedly thwarted at least 13 terror plots. The country has one of the strictest gun control laws, and its borders, unlike countries in the European Union, are not open. Still the Westminster attack shows how a “lone wolf” without any conventional weapons could bring terror even to the most guarded zones. This is the security challenge the British establishment, as other governments, face today. If terror plots are planned by networks that use modern communication systems and amass weapons, the chances of detecting them are higher. But after the rise of the IS, its followers, mostly radicalised youth, have used different tactics. They stay of the intelligence radar, wait, and use even commonly used public goods as weapons to kill.

It is still not clear if Masood had communicated with an international terrorist organisation. The IS, that claimed responsibility for the incident, described him as a “soldier” of the Caliphate who responded to the “call” to attack Western nations, but stopped short of saying it directed the attack. If such attackers do not have any contact with terrorist groups, it makes it difficult for intelligence communities to detect them. To its advantage, the IS has created a narrative where every ‘believer’ has the responsibility to take up weapons against the ‘crusaders’ and their allies. Given that the group also has a dynamic online propaganda system, the challenges of radicalisation it poses remain. Britain’s immediate response has been commendable. Both political and community leaders, barring the far right fringe, sent out a message of unity. But the bigger challenge is to prevent more such non-conventional attacks, for which security officials need to have better human intelligence and community relations. Equally important is to deny the far right the opportunity to use such actions by a handful of individuals and target the majority of British Muslims, exactly what the terrorists want.

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