Allow Foreign Donations for Kerala Flood Relief: Senior Retd Bureaucrat to Modi

In an open letter to prime minister, Narendra Modi. EAS Sarma, former secretary to the government of India, a senior retired bureaucrat has questioned the Centre’s wisdom in refusing the grant of over Rs 700 crores in flood relief to the state of Kerala. The text of the letter may be read below.


Sarma has been a stringent critique of some of the policies of the Modi regime, sharply criticising even the manner in which the FCRA was amended (without debate) to allow political parties access to funds. The Modi regime’s crackdown on human rights organisations etc over the issue of FCRA has been widely condemned, including by the United Nations. The letter has also been copied to union finance minister, Arun Jaitley.
The text of the Open letter may be read here:
Hon Prime Minister,
Shri Narendra Modi,
I refer to my letter dated March 21, 2018 (copy included below) on the questionable manner in which your government had gone to the extreme extent of amending Foreign Contributions Regulation Act (FCRA) retrospectively to pave the way for political parties such as BJP and INC to receive donations from foreign companies. In other words, your government had no hesitation whatsoever in going out of the way to clear legislative hurdles so as to enable you to open the floodgates to foreign donations to fund your electioneering activity.
What surprises me is that, in the same breath, your government should deny Kerala government to accept foreign donations, not for political purposes, but for providing relief to millions of those who are reeling under the recent flood deluge. I understand that UAE has offered around Rs 700 crores to Kerala by way of relief but, as reported, your government has raised objections to allowing Kerala government accepting that offer.
You yourself perhaps visited UAE in February this year and signed several MOUs including one on immigrant Indian workers in that country. I am sure you have seen how Kerala immigrants are employed in large numbers by various UAE agencies in different walks of life, contributing their might to that country’s development. That was the reason why UAE has offered aid to Kerala.
If political parties are empowered through legislative instruments to seek and receive donations from foreign agencies. would it be appropriate for your government to raise objections to Kerala receiving aid from UAE merely for providing relief to its flood victims?
There cannot be double standards in foreign donations being received, one for political parties and another for State governments facing the onslaught of natural calamities.
I hope you will ponder over what I have stated above and allow as much of relief as possible to reach Kerala on time, from whatever source it comes. This is a time when technicalities should be relegated to the background and humanity pushed to the front.
Yours sincerely,
E A S Sarma
Former Secretary to GOI
August 22, 2018
Text of March 2018 Letter to PM and FM may be read here:
Shri Narendra D Modi
Prime Minister
Shri Arun Jaitley
Union Fiance Minister
Dear Shri Modi and Shri Jaitley,
I write this letter in anguish, in continuation of my earlier letter dated 3-2-2018, on NDA government’s ill advised but persistent move to amend Foreign Contribution Regulation Act (FCRA), 1976 retrospectively, merely to escape the penal provisions of that Act with specific reference to the violations committed by BJP and the other political parties who accepted donations from foreign multi-national companies (MNCs) illegally.
What I feared has since become a harsh reality, when the Finance Bill, 2018, along with its egregious and highly objectionable provision to amend 1976 FCRA, was hurriedly got enacted in the Parliament a few days ago, without any semblance of a discussion and a debate. The most distressing aspect of it is that FCRA 1976 had already lapsed in 2010, when UPA introduced a successor legislation in the avatar of FCRA 2010. To revive a dead law only to amend it represents the height of innovative legal jugglery!
One can understand a law being amended retrospecively to safeguard the national interest, or to ensure national security, or to protect the disadvantaged sections of the society. A law being altered, to efface the statutory sins committed by the political parties in the past and allow them to fill their coffers with the bounty provided by the foreign MNCs in the future, is not only unethical but also having far reaching adverse implications for the integrity of India’s democracy and preservation of the security of the nation. Soon, I would not be surprised if the elections in India are orchestrated by foreign MNCs with their money power and the national policies are dictated by them to suit their interests. Perhaps, it has already started happening.
I had earlier pointed out how some mining companies, involved in under-invoicing of the indigenously extracted iron ore exported outside the country, are reported to be holding illicit foreign accounts and apparently round-tripping funds from those accounts to their subsidies in India and providing donations to political parties who in turn have been allowing those very same companies to violate the law of the land and commit serious human rights violations. The successive Finance Acts during the last three years have unabashedly “legalised” this dubious cycle of sleeze and corruption. You should read Justice Shah Committee’s report on illegal iron ore mining in Goa to appreciate wht I have said. I have filed a formal complaint before the Central investigation agencies to investigate this but I am not sure whether they will ever be allowed to act.
While India’s Finance Ministry is busy amending FCRA to enable the political parties to receive bounties from foreign MNCs so that those political parties may splurge funds on extravagent electioneering that makes a mockery of the ideals of Dr B R Ambedkar and the other elders who gave us a unique Constitution, Finance Minsitries in the other countries, who are accountable to the public in their respective countries, have been watching the conduct of those very same MNCs and avoiding any financial transactions with them, lest their voters should question their motives. I enclose here an extract from the website of the Norwegian Sovereign Wealth Fund managed by that country’s Finance Ministry which has made the following observation.
On the 13th of September 2013, the Ministry of Finance received a recommendation from the Council of Ethics to exclude the company Sesa Sterlite from the GPFG. The recommendation builds on an earlier recommendation to exclude the company Vedanta Resources Ltd. (Vedanta ) and two of its subsidiaries, which operate in India. The Ministry followed the Council’s recommendation to exclude Vedanta and its two subsidiaries in 2007…………………..Sesa Sterlite is a newly established subsidiary of Vedanta. The Council’s assessment is that the relevant operations in India, which are currently run through the company Sesa Sterlite, present an unacceptable risk of environmental damage and serious violations of human rights. The Council has regularly updated its assessment of Vedanta and the basis for exclusion is still considered to be present. The Ministry of Finance, in accordance with the Council’s recommendation, has decided to exclude Sesa Sterlite from the Fund’s investment universe, as well as to maintain the exclusion of Vedanta.
You may recall that the order dated 28-2-2014 pronounced by Hon’ble Delhi High Court in WP (C) No 131/2013, in which I was a petitioner, referred to this very same group of companies and the FCRA violations committed by them.
NDA government’s FCRA amendments have the effect of regularising the violations committed in the past and legalising foreign bounties in the future. I request you to ponder over what you have done vis-a-vis how the Norwegian Sovereign Wealth Fund manager, namely, the Norwegian Finance Ministry has dealt with the very same MNC. The Norwegians must be wondering at the intricacies of our democracy!
Apart from the morality and the ethics underlying the damage you have wrought on FCRA, do you consider what you have done to be legally permissible? It may not be.
I have enclosed here a copy of a judgement pronounced by Hon’ble Supreme Court on 15-3-2018 in Civil Appeal No 5793/2008 (State Of Karnataka vs Karnataka Pawn Brokers Assn. . on) in which the apex court has made the following observation.
On analysis of the aforesaid judgments it can be said that the Legislature has the power to enact validating laws including the power to amend laws with retrospective effect. However, this can be done to remove causes of invalidity. When such a law is passed the Legislature basically corrects the errors which have been pointed out in a judicial pronouncement. Resultantly, it amends the law, by removing the mistakes committed in the earlier legislation, the effect of which is to remove the basis and foundation of the judgment. If this is done, the same does not amount to statutory
overruling……However, the Legislature cannot set at naught the judgments which have been pronounced by amending the law not for the of making corrections or removing anomalies but to bring in new provisions which did not exist earlier. The Legislature may have the power to remove the basis or foundation of the judicial pronouncement but the Legislature cannot overturn or set aside the judgment,that too retrospectively by introducing a new provision. The legislature is bound by the mandamus issued by the Court. A judicial pronouncement is always binding unless the very fundamentals on which it is based are altered and the decision could not have been given in the altered circumstances. The Legislature cannot, by way of introducing an amendment, overturn a judicial pronouncement and declare it to be wrong or a nullity. What the Legislature can do is to amend the provisions of the statute to remove the basis of the judgment”
Apparently, the decisions to amend FCRAs of 1976 and 2010 ware not based on a sound legal premise. Perhaps, your government was in too much of a haste to wait, pause and look into the ethics and the legality of the decisions. Perhaps, the sole objective of these decisions was to somehow obliterate the past statutory violations and create scope for receiving foreign contributions through the subsudiaries of the MNCs.
Latest studies have shown that BJP has been the largest recepient of such donations, which corroborates what I have said. Political donations are not given by private companies out of their love for democracy. They know where they can seek policy tweaks to furher their own interests.
I request you to consider carefully what I have stated in the previous paragraphs and the earlier correspondence and, for the sake of electoral ethics and morality, immediately revoke all amendments to FCRA and the corresponding amendments to the Companies Act, failing which I will no other alternative than to seek judicial intervention.
I am sure that both of you, being fully committed to maintaining the integrity of the electoral system and safeguarding the national interest, will revisit these amendments and revoke them to uphold the democratic processes.
I am circulating this letter widely among all political parties and the public at large in order to generate a comprehensive debate on the issues I have raised.
Yours sincerely,
E A S Sarma
Former Secretary to GOI
March 21, 2018
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