Political, bureaucratic, corporate and individual corruption in India are major concerns. A 2005 study conducted by Transparency International in India found that more than 55% of Indians had first-hand experience of paying bribes or influence peddling to get jobs done in public offices successfully.
Transparency International estimates that truckers pay US$5 billion in bribes annually.In 2011 India was ranked 95th out of 178 countries in Transparency International's Corruption Perceptions Index.
In the book 'Corruption in India: The DNA and RNA' authored by
Professor Bibek Debroy and Laveesh Bhandari say that the public
officials in India may be cornering as much as Rs.92,122 crore ($18.42
billion), or 1.26 per cent of the GDP, through corruption. The books estimates that corruption has virtually enveloped India growing annually by over 100 percent and most bribery is accrued from the transport industry, real estate and "other public services". On March 31, 2010 the Comptroller and Auditor General of India said that unutilised committed external assistance was of the order of Rs.1,05,339 crore.”
“The recent scams involving unimaginably big amounts of money, such
as the 2G spectrum scam, are well known. It is estimated that more than US$1 trillion are stashed away in foreign havens, while World Bank estimated that 80% of Indians earn less than US$2
per day and every second child is malnourished. It seems as if only the
honest people are poor in India and want to get rid of their poverty by
education, emigration to cities, and immigration, whereas all the
corrupt ones, are getting rich through scams and crime. It seems as if
India is a rich country filled with poor people", the organisers of Dandi March II in the United States said.
Politics:
As of December 2008, 120 of India's 523 parliament members were facing criminal charges. Many of the biggest scandals since 2010 have involved very high levels of government, including Cabinet Ministers and Chief Ministers, such as in the 2G spectrum scam, the 2010 Commonwealth Games scam and the Adarsh Housing Society scam, Coal Mining Scam, mining scandal in Karnataka and cash for vote scam.
Black money:
Black money refers to money removed from the official economy (via
corruption, bribery, tax evasion, etc.) and stored outside of the
country. A November 2010 report from the Washington-based Global Financial Integrity estimates that India lost at least US$462 billion in illicit financial flows,
another word for black money, from 1948 through 2008. The report also
estimated the size of India's underground economy at approximately
US$640 billion at the end of 2008 or roughly 50% of the nation's GDP.
Black Money in Switzerland:
According to a 2010 The Hindu article, unofficial estimates indicate that Indians had over US$1456 billion in black money stored in Swiss banks (approximately USD 1.4 trillion). While some news reports claimed that data provided by the Swiss Banking Association Report (2006) showed India has more black money than the rest of the world combined, a more recent report quoted the SBA's Head of International Communications as saying that no such official statistics exist. Another report said that Indian-owned Swiss bank account assets are worth 13 times the country’s national debt.The current investigation is undertaken by the Income Tax Department.
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Anti-Corruption Laws in India:
Public servants in India can be penalized for corruption under the
- Indian Penal Code, 1860
- The Prevention of Corruption Act, 1988
- The Benami Transactions (Prohibition) Act, 1988 to prohibit benami transactions.
- Prevention of Money Laundering Act, 2002
Effects of corruption:
Economic Concerns
Corruption may lead to further bureaucratic delay and inefficiency as
corrupted bureaucrats may introduce red tape to extract more bribes. Such inadequacies in institutional efficiency could affect growth indirectly by lowering the private marginal product of capital and investment rate. Levine and Renelt showed that investment rate is a robust determinant of economic growth[47]. According to the neoclassical growth model, institutional variables contribute to determining steady-state per capital income levels and speed of convergence to its steady state, hence affecting its growth rate.
Bureaucratic inefficiency could also affect growth directly, such as through misallocation of investments in the economy.
When a country’s economy is below its steady-state income level, higher
corruption could result in lower growth, for a given level of income.
As an anecdote, an April 10, 2012, demolition of a wheelchair-access
building at the Kriyayoga Institute in Allahabad, shows how discouraging
corruption can be to foreign travel and investment. Allahabad
Development Authority officials demolished the building against a court
restraining order, with 150 police officers storming the facility and
injuring local and foreign guests. Statement
of Swami Shantanand, an American medical doctor injured and dragged by
Allahabad police during the unlawful demolition (n.b. links to
disturbing video of the incident). The officials involved were allegedly seeking $45,000 USD in bribes.
Anti-corruption police and courts:
The Directorate General of Income Tax Investigation, Central Vigilance Commission and Central Bureau of Investigation
all deal with anti-corruption initiatives. Certain states such as
Andhra Pradesh (Andhra Pradesh Anti-corruption Bureau) and Karnataka (Lokayukta) also have their own anti-corruption agencies and courts.
The Anti Corruption Bureau (ABC) has launched a large scale
investigation into the Central Bureau of Investigation (CBI)’s
involvement in the “cash-for-bail” scam.
CBI court judge Talluri Pattabhirama Rao was arrested on 19 June 2012
for taking a bribe to grant bail to former Karnataka Minister Gali
Janardhan Reddy, who was allegedly amassing assets disproportionate to
his known sources of income. Investigation revealed that India Cements -
one of India's largest cement - had been investing in Reddy’s
businesses in return for government contracts. A case has also been opened against seven other individuals under the Indian Penal Code and the Prevention of Corruption Act.
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