Corruption in India is a major issue that adversely affects its economy.[1] A study conducted by Transparency International in year 2005 found that more than 62% of Indians had first hand experience of paying bribes or influence peddling to get jobs done in public offices successfully.[2][3] In its study conducted in year 2008, Transparency International reports about 40% of Indians had firsthand experience of paying bribes or using a contact to get a job done in public office.[4]
In 2015, India was ranked 85th out of 175 countries in Transparency International's Corruption Perceptions Index, compared to its neighbors Bhutan (30th), Bangladesh (145th), Myanmar (156th), China (100th), Nepal (126th), Pakistan (126th) and Sri Lanka (85th). This is the second least corruption rank for India in the whole of South Asia.[5] In 2013, India was ranked 94th out of 175 countries.[6]
Most of the largest sources of corruption in India are entitlement programmes and social spending schemes enacted by the Indian government. Examples include Mahatma Gandhi National Rural Employment Guarantee Act and National Rural Health Mission.[7][8]Other daily sources of corruption include India's trucking industry which is forced to pay billions in bribes annually to numerous regulatory and police stops on its interstate highways.[9]
Indian media has widely published allegations of corrupt Indian citizens stashing trillions of dollars in Swiss banks. Swiss authorities, however, deny these allegations. The Indian media is mainly owned by corrupt politicians and industrialists who also play a major role in most of these scams, thus misleading public with wrong information and using media for mudslinging against their political and business opponents.[10][11]
The causes of corruption in India include excessive regulations, complicated taxes and licensing systems, numerous government departments each with opaque bureaucracy and discretionary powers, monopoly by government controlled institutions on certain goods and services delivery, and the lack of transparent laws and processes.[12][13] There are significant variations in level of corruption as well as in state government efforts to reduce corruption across India.
Bureaucracy[edit]
A 2005 study done by Transparency International in India found that more than 62% of the people had firsthand experience of paying bribe or peddling influence to get a job done in a public office.[3] Taxes and bribes are common between state borders; Transparency International estimates that truckers pay annually ₹222 billion (US$3.3 billion) in bribes.[9][15]
Government regulators and police share in bribe money, each to the tune of 43% and 45% respectively. The en route stoppages including those at checkpoints and entry-points take up to 11 hours in a day. About 60% of these (forced) stoppages on road by concerned authorities such as government regulators, police, forest, sales and excise, octroi, weighing and measuring department are for extorting money. The loss in productivity due to these stoppages is an important national concern. The number of truck trips could increase by 40%, if forced delays are avoided. According to a 2007 World Bank published report, the travel time for a Delhi-Mumbai trip can be reduced by about 2 days per trip if the corruption and associated regulatory stoppages to extract bribes was eliminated.[15][16][17]
A 2009 survey of the leading economies of Asia, revealed Indian bureaucracy to be not only the least efficient out of Singapore, Hong Kong, Thailand, South Korea, Japan, Malaysia, Taiwan, Vietnam, China, Philippines and Indonesia, but also that working with India's civil servants was a "slow and painful" process.[18]
Land and property[edit]
See also: Illegal housing in India
Officials are alleged to steal state property. In cities and villages throughout India, consisting of municipal and other government officials, elected politicians, judicial officers, real estate developers and law enforcement officials, acquire, develop and sell land in illegal ways.[19][page needed][better source needed]
Tendering processes and awarding contracts[edit]
A 2006 report claimed state-funded construction activities in Uttar Pradesh, such as road building, were dominated by construction mafias, which are groupings of corrupt public works officials, materials suppliers, politicians and construction contractors.[20]
Corruption caused problems in government funded projects are not limited to the state of Uttar Pradesh. According to The World Bank, aid programmes are beset by corruption, bad administration and under-payments. As an example, the report cites only 40% of grain handed out for the poor reaches its intended target. The World Bank study finds that the public distribution programmes and social spending contracts have proven to be a waste due to corruption.[21]
As an example, the government implemented the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) on 25 August 2005. The Central government outlay for this welfare scheme is ₹400 billion (US$6.0 billion) in FY 2010–2011.[22] After 5 years of implementation, in 2011, the programme was widely criticised as no more effective than other poverty reduction programmes in India. Despite its best intentions, MGNREGA faces the challenges of corrupt officials reportedly pocketing money on behalf of fake rural employees, poor quality of the programme's infrastructure, and unintended destructive effect[clarification needed] on poverty.[8][23]
Medicine[edit]
In Government Hospitals, corruption is associated with non-availability/duplication of medicines, getting admission, consultations with doctors and availing diagnostic services.[3]
National Rural Health Mission is another health care-related government programme that has been subject to large scale corruption allegations. This social spending and entitlement programme hoped to improve health care delivery across rural India. The programme has been managed since 2005 by the Ministry of Health of the Indian government. The Indian government mandated a spending of ₹277 billion (US$4.1 billion) in 2004–05, and increased it annually to be about 1% of India's gross domestic product. The National Rural Health Mission programme has been clouded by a large-scale corruption scandal in which top government appointed officials were arrested, several of whom died under mysterious circumstances including one in prison. Corruption, waste and fraud-related losses from this government programme has been alleged to be₹100 billion (US$1.5 billion).[24][25][26][7]
Science and technology[edit]
CSIR, the Council of Scientific and Industrial Research, has been flagged in ongoing efforts to root out corruption in India.[27] Despite being established with the directive to do translational research and create real technologies, CSIR has been accused of transforming into a ritualistic, overly-bureaucratic organisation that does little more than churn out papers.[28][29]
There are many issues facing Indian scientists, with some - such as MIT systems scientist VA Shiva Ayyadurai - calling for transparency, a meritocratic system, and an overhaul of the bureaucratic agencies that oversee science and technology.[30][31][32] Sumit Bhaduri stated, "The challenges of turning Indian science into part of an innovation process are many. Many competent Indian scientists aspire to be ineffectual administrators [due to administrative power and political patronage], rather than do the kind of science that makes a difference".[33] Prime minister Manmohan Singh spoke at the 99th Indian Science Congress and commented on the state of the sciences in India, after an advisory council informed him there were problems with "the overall environment for innovation and creative work" and a 'warlike' approach was needed.[34]
Income tax department[edit]
There have been several cases of collusion of officials of the income tax department of India for preferential tax treatment and relaxed prosecutions in exchange for bribes.[35][36]
Preferential award of mineral resources[edit]
See also: Illegal mining in India
In August 2011, an iron ore mining scandal became a media focus in India. In September 2011, Janardhana Reddy – an elected member of Karnataka's legislative assembly – was arrested on charges of corruption and illegal mining of iron ore in his home state of Karnataka. It was alleged that his company received preferential allotment of resources, organised and exported billions of dollars worth of iron ore to China in recent years, without paying any royalty to the state government exchequer of Karnataka or the central government of India, and these Chinese companies made payment to shell companies controlled by Reddy and registered in Caribbean and north Atlantic tax havens.[37][38]
It was also alleged that corrupt government officials cooperated with Reddy, starting from government officials in charge of regulating mining to government officials in charge of regulating port facilities and shipping. These officials received monthly bribes in exchange for enabling the illegal export of illegally mined iron ore to China. Such scandals have led to a demand in India for consensually driven action plan to eradicate the piracy of India's mineral resources by an illegal-political-corrupt government officials-business nexus, removal of incentives for illegal mining, creation of incentives for legal mining and domestic use of iron ore and steel manufacturing.[37][38]
Driver Licensing[edit]
A study conducted between 2004 and 2005 found that India's driver licensing procedure was a hugely distorted bureaucratic process and allows drivers to be licensed despite their low driving ability through promoting the usage of agents. Individuals with high willingness to pay make a significant payment above the official fee and most of these extra payments are made to agents, who act as an intermediary between bureaucrats and applicants.[39]
The average licensee paid Rs 1080, approximately 2.5 times the official fee of Rs 450, in order to obtain a license. On average, those who hired agents had a lower driving ability, with agents helping unqualified drivers obtain licenses and bypass the legally required driving examination. Among the surveyed individuals, approximately 60% of the license holders did not take the licensing exam and 54% of those license holders failed an independent driving test.[40]
Agents are the channels of corruption in this bureaucratic driver licensing system, facilitating access to licenses among those who are unqualified to drive. Some of the failures of this licensing system are caused by corrupt bureaucrats who collaborate with agents by creating additional barriers within the system against those who did not hire agents.[39]
Trends[edit]
Professor Bibek Debroy and Laveesh Bhandari claim in their book Corruption in India: The DNA and RNA that the public officials in India may be cornering as much as₹921 billion (US$14 billion), or 1.26 per cent of the GDP, through corruption.[16] The book claims most bribery is in the transport industry, real estate and government delivered services.
Bribery and corruption are pervasive, but some sectors tend to witness a relatively higher degree of such instances. A 2013 EY(Ernst & Young) Study[41] reports following sectors, perceived as the most vulnerable to corruption: Infrastructure & Real Estate, Metals & Mining, Aerospace & Defense, Power & Utilities. There are a range of specific factors that make a sector more susceptible to bribery and corruption risks than others. Factors like high use of middlemen, large value contracts, liasioning activities etc. drive the depth, volume and frequency of corrupt practices in vulnerable sectors.
A 2011 KPMG study reports India's real estate, telecommunications and government-run social development projects as the three top most corruption plagued sectors. The study found India's defence, information technology industry and energy sectors are the most competitive and least corruption prone sectors.[12]
CMS India claims in its 2010 India Corruption Study report that socio-economically weaker section of the Indian society is most adversely affected by government corruption – these include the rural and urban poor. The study additionally claims that corruption perception nationwide has decreased between 2005 to 2010. Over the 5-year period, significantly more number of people from the middle class as well as the poorest segments of Indian society surveyed, in all parts of the India, claimed government corruption had dropped over time, and they had lesser direct experiences with demands for bribes.[42]
The table below compares the perceived anti-corruption effort across some of the major states in India.[13] A rising index implies higher anti-corruption effort and falling corruption. According to this table, the states of Bihar and Gujarat have experienced significant improvements in their anti-corruption efforts, while the conditions have worsened in the state of Assam and West Bengal. Consist
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