India’s Supreme Court Strikes Down a Fund-Raising Edge for Modi

India’s Supreme Court on Thursday struck down a contentious fund-raising mechanism that allowed individuals and corporations to make anonymous political donations, a system that was widely seen as an advantage for Prime Minister Narendra Modi’s governing party.

Though the judgment came just months before the country’s next general election, probably too soon to affect its outcome, activists said it could bring more accountability to campaign finance down the road.

The ruling on “electoral bonds,” as the fund-raising instruments are known, came a full six years after Mr. Modi’s government introduced them. According to political analysts, his ruling Bharatiya Janata Party raised immense sums of money during that period — both from electoral bonds and other means — money it has used to trounce its rivals in elections and drown out opposition voices more generally.

Under the contested fund-raising system, the government-owned State Bank of India, India’s largest commercial bank, issued paper bonds that could be purchased in exchange for donations to a political party of the donor’s choice. They range from just $12 to more than $120,000, with no limit on the number of bonds that a donor could buy.

Though the purchases were anonymous in the sense of not being publicly reported, every buyer’s identity was known to the State Bank of India, which is run by the federal government.

“This decision was undertaken for a laudable objective to bring in transparency in the electoral system. We respect the court order,” Ravi Shankar Prasad, a leader from the ruling party, said about the Supreme Court ruling. “We will give a proper response after studying the whole judgment.”