India needs to put in place stringent laws against corruption in order to develop a clean and transparent system
The challenge of combining growth with integrity to ‘design out corruption’ and create processes that will help India perform better on the transparency and integrity index was today addressed at the India Economic Summit and the consensus was that rectification of processes and the idealism of a new breed of Indian entrepreneur would help in driving corruption out.
Participants pointed out that not just legal but ethical context as well had changed. Till 20 years ago, for European companies to pay bribes to secure contracts was par for the course. But, companies were blackballed if they used unethical practices to get business. Companies were now much more subject to public scrutiny than ever before. Yet, there were islands of integrity; the question was how these could be linked up to form a sea.
Former US ambassador and currently deputy secretary general with the Organisation for Economic Cooperation and Development (OECD) Richard Boucher said corruption hurts economic efficiency and the corrupt steal from the poorest. But now, honesty and integrity is part of a business model and the United Nations has a convention against corruption (to which India is yet to become a signatory).
In the Indian context, Boucher said 30 per cent of India’s GDP goes to government procurement, which needs a clean and transparent system. “The more the regulation, the more the chance of bribery,” Boucher said.
Dancer and political activist Mallika Sarabhai said the corrupt need to be punished publicly; their property needs to be seized and a regulatory body needs to be set up to investigate corruption.
CV Madhukar, director of PRS Legislative Research, said corruption needs to be defined more inclusively. He pointed out that through the discussion on land acquisition and the Special Economic Zones Act, which went on for an hour and 45 minutes in the Parliament, not a single MP spoke on the issue of corruption in land acquisition.
He said several laws had been examined, which had a clear possibility of creating corruption. But, there had been no scrutiny of this aspect of the legislation. Madhukar said not a single person had ever been punished for even a single day, on charges of corruption. This needed to change. In the Satyam case, for instance, the charge sheet was yet to be filed. But in the Bernie Madoff case in the US, Madoff had been convicted to around 330 years in prison and his property had been seized and was auctioned last week.
Saurabh Srivastava, chairman of CA Technologies India, said processes had to be changed so that there was no opportunity for people to be corrupt. “If you give people the opportunity to be corrupt, they will be,” he said. He said technology was the best way to fight corruption. The US Social Security system encompassed around $60 m but there was 99.8 per cent accuracy. By contrast, there were leakages ranging from 50 to 80 per cent in India, something the UID project might be able to prevent.
Boucher said that all over the world, there was an overlap between the interests of law makers and industry and frequently the lines got blurred, leading to ‘regulatory capture’. India too was facing the same problem. He also reminded the audience that all industry was not bad and that many in India and elsewhere had been lifted out of poverty and ignorance by the force of entrepreneurship. “Don’t ask corporations to be governments,” Boucher said.
