MUMBAI: The board of India-listed Vedanta Ltd approved a Rs 200-crore contribution to political parties, even as the parent company is working round the clock to arrange a $1-billion payment on dollar-denominated bonds that are due in January.
The board also approved reinstating the unutilised limit of Rs 57 crore – agreed in June 2022 – for making contributions to political parties.
ET has reviewed the copy of the resolution passed by the board. Emails sent to Vedanta Ltd for its comments remained unanswered until the publication of this report.
The limits of Rs 200 crore and Rs 57 crore contributions are valid until March 2025, the resolution copy shows.
The board has approved “the contribution either directly or through electoral trust and in any form including subscription to electoral bonds”.
Vedanta’s board resolution stated that the “chairman and the vice chairman be, and are hereby, severally authorised to decide the quantum of political contribution to be paid to individual political parties”.
Anil Agarwal is the non-executive chairman of Vedanta and his brother Navin Agarwal is executive vice chairman, according to the company’s website.
Vedanta passed the resolution on November 4, just two days before the 29th tranche of electoral bond sales was launched. These sales ended November 20. The window for the sale of electoral bonds opened ahead of elections in Madhya Pradesh, Rajasthan, Chhattisgarh, Telangana and Mizoram.
Vedanta’s founder, Anil Agarwal, who started as a scrap dealer in the early 1970s, now runs a metals-to-mining conglomerate with a market cap of Rs 96,554 crore. Its shares closed at Rs 259 on Friday at the BSE. It has proposed splitting its business into five units – aluminium, oil & gas, base metals, steel and ferrous and power generation.
In the last five years, Vedanta contributed ?457 crore to political parties by subscribing to electoral bonds and in FY23 alone it donated ?155 crore, as reported by ET on June 21.
The electoral bond scheme was launched in 2018 as an alternative to cash donations made to the political parties. It provides for anonymous funding by individuals or corporates to political parties. The government-owned State Bank of India is the only bank authorised to issue and encash electoral bonds through its authorised branches.
According to data released by the Association of Democratic Reforms (ADR), political parties received Rs 13,791 crore in donations from the electoral bonds in 27 phases between 2018 and 2022. After that, the government launched two more phases.
Separately, a five-judge bench of the Supreme Court has begun hearing petitions challenging the validity of electoral bonds used to fund political parties.
