As India ratified the UN Convention Against Corruption six years after signing it, the US-based Indians have said the move will bring private sector to the forefront of public debate and reform and hoped the government will take effective actions that can stand up to global scrutiny.
India became a state-party to the anti-corruption convention on May 9 after submitting the instrument of ratification to UN Secretary General Ban Ki-moon at the world body headquarters here.
"By joining the Convention, the Government of India renews its commitment toward fighting corruption both at national and international arena," said a statement from the Indian mission to the UN this week.
Anupama Jha, head of Transparency International-India, noted that two important elements of the Act are its provisions for recovering black money overseas and bringing the private sector within the fold of the law.
Under existing laws, Jha pointed out, only the demand side of corruption can be prosecuted. Since the supply side is not liable for corruption, the expert said, private parties in the 2G scam, for instance, can only be charged for criminal conspiracy.
"The ratification of this treaty will bring the private sector to the forefront of public debate and reform," she said.
Global Financial Integrity, a Washington DC-based non-profit group, has estimated that at least $462 billion were illegally transferred overseas from India between 1948 and 2008.
Jha stressed that only political will could produce results. "Recovering assets is never easy," she said. "It is hoped that the government will be more proactive in bringing back the black money."
India currently ranks 87 out of 178 countries on Transparency International's Corruption Perception Index for 2010, faring better than its neighbours Pakistan, Sri Lanka, Nepal and Bangladesh.
The Convention's four major components are Prevention, Criminalisation, International Cooperation and Asset recovery. "This evil phenomenon is found in all countries - big and small, rich and poor - but it is in the developing world that its effects are most destructive," it says.
Meenakshi Ganguly, head of Human Rights Watch-India, described corruption as a violation of human rights since it undermines public accountability.
"Any law is only as good as its implementation," she said. "We hope that by ratifying the convention, the government is committing to effective actions that can stand up to international scrutiny."
Arvind Panagariya, a leading Indian economist at Columbia University, welcomed the ratification but said it was "tricky" to assess the impact of corruption on the economy.
"A corruption free system that works smoothly is the best," he told PTI. "But if that system doesn't work then the situation can be tricky."
The scholar described a situation where the absence of bribes to get licences, for instance, would result in licenses not getting issued. This would lead to companies not being set up and therefore no economic growth. "With bribes things would have moved a bit," he said.
On the issue of whether corruption was a turn-off for foreign investors, Panagariya responded, "on the margins, this has a negative effect."
"An investor will not want to give a bribe that is forbidden in his own country's law," he said.
