'75% of business bribes paid to govt officials in legal, metrology, health'

Nearly 70% of businesses have admitted to paying bribes in the last 12 months in India, according to a recent survey conducted by LocalCircles. These bribes were mainly paid to government officials for permits, compliance, and timely contract processing. While the total value of bribes has decreased, the survey reveals that 54% of businesses were forced into paying bribes, which amounts to extortion.

 

Government departments such as Legal, Metrology, Food, Drug, and Health are among the most cited for bribery demands, with 75% of businesses reporting payments made to officials in these sectors. Despite the Prevention of Corruption Act, bribery remains widespread, fueled by the lack of digitization in state and local processes.

 

Over 18,000 responses were received from over 9,000 unique businesses located in 159 districts of India. 

 

Corruption continues to be a major challenge for Indian businesses, with 66% of respondents admitting to paying bribes in the past year. Despite anti-corruption laws, businesses often pay bribes to speed up processes related to permits, licenses, and property matters. Notably, 41% of businesses reported paying bribes "several times," while 24% did so "once or twice." 

 

Of businesses surveyed that paid bribes in the last 12 months, 83% paid it in cash and 17% paid it in kind (gifts or favours). 

 

"It must be noted here that many businesses, especially large corporates, startup unicorns or multinationals do not want to engage in corruption directly and hence they tend to hire middlemen, facilitators or agents who are tasked to also handle activities like bribery," said the survey. 

 

 The survey found that 54% of businesses were "forced" to pay bribes, while 46% did so for quicker processing.  Despite increased computerization in some sectors, bribery still occurs behind closed doors, with many businesses resorting to it as a necessary step to avoid delays in obtaining permits or completing essential tasks.

 

 However, there’s a silver lining: the number of bribery transactions and the total value of bribes paid has decreased, thanks to ongoing digitization efforts in government departments. The survey shows that 30% of businesses no longer needed to pay bribes this year, signaling a positive trend toward reducing corruption in the country.

 

While digitization efforts have reduced the frequency of bribes and their value, many businesses still encounter corruption, particularly when interacting with public sector undertakings and private entities. Though platforms like the Government eProcurement marketplace aim to reduce corruption, the problem persists, signaling the need for more extensive digital reform. 72% of respondents claimed to have paid bribes  to “government officials”, 51% paid it to

“Public Sector Undertaking (PSU) officials”, and 28% to “private company officials”. 

 

To sum up, many businesses surveyed admitted to paying a bribe in the last 12 months to different types of entities for qualifying as a supplier, secure quotations & orders and collect payments. This indicates that bribery is rampant in India when someone is trying to do business with an entity. It must also be noted that such bribery is rarely reported in complaints as it suits the interest of both the bribe taker and the bribe giver. Though initiatives like the Government eProcurement marketplace are good steps to reduce corruption, there are still openings to engage in corruption for supplier qualification, bid manipulation, completion certificate and payments

 

Experts believe the solution lies in full digitization of government processes at the state and local levels to eliminate human interfaces and reduce corruption. However, achieving this requires strong governmental standards and funding for state and local bodies. Until then, tackling bribery remains a significant hurdle for businesses across India.