Corruption in Pakistan

Submitted to:
Sir F.M. Nazeer

Submitted by:
Rafia Hanif Butt
Rehmana Latif
Imran Saeed
Jamila Bugti
Adil Khan
Contents
Corruption in Pakistan.................................................................................................................................1
Introduction.................................................................................................................................................3
Definition.....................................................................................................................................................3
WHAT CONSITUTES CORRUPTION?.............................................................................................................3
Factors which constitute corruption in Pakistan:........................................................................................4
Corruption Report 2010 – Transparency International................................................................................5
Some highlights of transparency international corruption report:..............................................................5
More from the Transparency international report......................................................................................5
Levels of Corruption in Pakistan..................................................................................................................7
Percentage of Respondents having encountered Corruption in South Asian countries..............................7
Key Sectors Affected by Corruption in Pakistan...........................................................................................8
Corruption in judiciary:................................................................................................................................8
Corruption in Tax and public finance:..........................................................................................................8
Corruption in political leaders:....................................................................................................................8
General corruption Cases in Pakistan:.........................................................................................................8
Impact of Corruption in Pakistan:................................................................................................................9
Causes of Corruption and Current anti-corruption institutions in Pakistan...............................................11
NAB (anti corruption institution in Pakistan).............................................................................................11
Causes of Corruption in Pakistan:..............................................................................................................11
Solution of corruption in Pakistan:............................................................................................................13
Suggestions about the system of government required for Pakistan are as follows:................................14
Conclusion.................................................................................................................................................15
Introduction

Definition
“Corruption can be defined as weakening or failure of system which brings a
system to become poor to deliver the required or almost failure to required
deliverance. Or simply Weakening or failure of system to deliver i.e. it is
simply sickness of the system to deliver the required to different levels of
failure”
Or

“An act done with an intent to gain some advantage inconsistent with official
duty and the rights of others it includes bribery , but is more comprehensive,
an act may be corrupt done, though the advantage to be derives from it be not
offered by another”

In its wider sense, corruption includes one or more of bribery, extortion, fraud,
deception, collusion, cartels, abuse of power, embezzlement, trading in influence and
money laundering.

A corrupt state creates a vicious circle in which the state quickly loses its authority and
ability to govern for the common good. Corruption makes it possible for critics to be
silenced, for justice to be subverted and for human rights abuses to go unpunished.
When corruption reigns, basic human rights and liberties come under threat and social
and economic contracts become unpredictable. Therefore corruption affects both civil
and political rights. As well as economic, social and cultural rights.

Corruption has permeated Pakistani society like a termite that need hide no more. A
time existed when it was devious and under-the-table. It is now a badge of honor, a kind
of recognition, a rite of passage. Many people in Pakistan believe that much of the
development and a significant portion of the operations allocations are lost due to
bribery and other related illegal and unethical activities. The extreme poverty and lack of
infrastructure and basic services in the rural areas of Sind and Baluchistan is in part
fueled by bribery, influence peddling, extortion, and abuse of power.

WHAT CONSITUTES CORRUPTION?

Corruption is rampant in Pakistan and is pushing our nation to a dead end. It is being
constituted by favoritism, nepotism, misappropriation of public fund, bad debts and
misuse of power, all these factors are on rise in Pakistan.

The underlying motive of corruption is to provide some one unfair advantage at the
expense of either another individual entity (person or corporate) or a collective entity
(country, province, city, community or company). In all cases, it is illegal, dishonest,
and/or unethical. A bribe may be a cash payment or a gift item of considerable value.

Factors which constitute corruption in Pakistan:

The Main factors which constitute corruption are:

 Injustice
 Insecurity
 Fear of survival
 Illogical system
 Unnecessary and over expanded Government machinery
 Under paid manpower in public and private sector
 Non existence of accountability
 Lacking of social and Moral Values
 Escalation in prices of goods in market
 Money devaluation
 Greed Main Forms of Corruption
 Placing of incompetent, characterless and ineligible persons in public and
private sectors i.e. without comprehensive checks and merit according to laws
and rules
 Undue pressures to influence for wrong by the authoritative people
 Misuse of powers
 Mala fide intentions
 Theft through white collar crime (Forgery, fudge and false)
 Lack of scrutiny
 Difficulties and obstacles to seek easy, comprehensive, true and timely justice
with due respect and comfort
 Torture
 Briber, Bribery against wrong and Bribery against right Impacts of injustice
Corruption Report 2010 – Transparency International

Every Pakistani is familiar with the word “Corruption”. Because they know there work
can only be done in every department if they follow corruption, help corruption. It is
impossible for an ordinary person to done his work by following the proper procedure in
many Public departments. But from last few years after the end of Army regime the
corruption perception has worsened especially the last year, as stated by the latest
Transparency International Corruption report 2010. Though the 2009 Corruption Survey
Report was an eye-opener, but this year it was shocking Khyber Pakhtoon Khawa
Province (former N.W.F.P) beat all the provinces and has the highest rate of corruption
in Pakistan.

Some highlights of transparency international corruption report:

More from the Transparency international report

 The report titled the National Corruption Perception Survey 2010 showed a high
rise in corruption from 195 billion rupees in the year 2009 to 223 billion rupees in
the year 2010.

 Bureaucracy and Police had maintained their ranking as the two of the most
corrupt departments in public sector in 2010.

 Land administration departments were placed third in corrupt practices.

 Corruption in the judiciary, local government and education sectors has also
increased as compared to the last year.

 About 70 % of people believed that the previous military regime of General

Pervez Musharraf was less corrupt then the present Pakistan People’s Party
(PPP) led coalition government.

 In terms of bribery, land administration was the most corrupt sector, where
average bribe paid in each incident was 46, 414 rupees.

 KPK is highlighted to be the most corrupt of all the provinces.

Levels of Corruption in Pakistan

It is a widely held view that corruption in Pakistan is widespread, systematic, and that it
is entrenched at all levels of government. A World Bank report containing an
assessment of the Pakistan’s Infrastructure Capacity (PICA) dated February 2008
states that 15% of Pakistan’s Development budget for 2007-08 was lost in the
procurement process alone due to corruption. This does not include subsequent costs
of corruption in the implementation and maintenance stages of projects.

The important business publications such as World Economic Forum’s Global

Competitiveness Report (2007-08) say that corruption is the third greatest problem for
companies for doing business in Pakistan. The report lists the first two problems as
government bureaucracy and poor infrastructure.

The Organization for Economic Cooperation and Development (OECD) says that the
World Bank and the Auditor General of Pakistan have complained about governance
problems in recruitment, site selection, absenteeism and bribery. This has resulted in
cancellation or suspension of some of the World Bank’s projects such as the
Baluchistan Primary Education Project. Also, certain other loans were withheld after
irregularities were uncovered.

Percentage of Respondents having encountered Corruption in South

Asian countries

A survey of South Asian countries reports the following percentages of respondents for
having encountered corruption in key sectors in various South-Asian countries:

Country education health power Land and tax police judiciary

adm.
Banglades 40% 58% 32% 73% 19% 84% 75%
h
India 34% 15% 30% 47% 15% 100% 100%
Nepal 25% 18% 12% 17% 25% 48% 12%
Pakistan 92% 96% 96% 100% 99% 100% 96%

General perceptions and actual public surveys about corruption show that Police, Power
Sector, Judiciary, various Taxation departments (Custom duties, Income Tax), and
irrigation departments are considered the most corruption prone departments in
Pakistan.
According to a report, appointments in the police force are often based on political
considerations. The instances where conflicts of interest due to personal loyalties and
family connections exist are numerous. Many complain that local landlords or urban
groups with police support exploit poor people through extortion (bogus fines, etc.).

Key Sectors Affected by Corruption in Pakistan

Corruption in judiciary:
According to a 2006 survey, 96 percent of the people said that they had encountered
corruption in Judiciary. 44 percent of them reported that they paid a bribe to a court
official. In Pakistan, The judiciary is not viewed as independent of the Executive side of
the government but rather part of it. Another report says that the Pakistani judiciary
takes an average of 880 days to settle a business dispute at a cost of 24 percent of the
claim (www.doingbusinesss.org).

Corruption in Tax and public finance:

Pakistan’s tax and public finance administration is also affected by corruption.
Corruption in tax sector and tax administration also dissuades honest tax payers by
rendering them less competitive and making the black- markets a more attractive
alternative. Tax administration is an attractive sector for corruption to take place as the
opportunities and incentives to engage in illicit activity are numerous .

Corruption in political leaders:

An article in one of Pakistan’s major English newspaper Daily Times says that the cost
of corruption by political leaders using public office for private gain in banking sector
alone cost 10 to 15%. The same newspaper reports that the overall cost of corruption
by political leaders in Pakistan is between 20% and 25% of the GDP. This is equitant to
an annual average GDP growth rate over 4 years.

General corruption Cases in Pakistan:

A statement by Asian Human Rights Commission (AHRC) issued on December 8, 2009
says that “. . . long periods of martial law have provided opportunities for the generals to
loot the country, by siphoning public funds for their own personal gain. The media,
judiciary, military and civil bureaucracy, became part of the loot of the generals’
corruption.”

Following are some explicit and implicit examples of corruption in Pakistan:

 ”Perks are a type of corruption which country’s ruling politicians, bureaucracy and
military elite is enjoying in the form of free fuel, electricity, accommodation, luxury
cars, army of servants. There is no legal and/or moral justification for such
perks.”
 “It is opined that 30 percent of total corruption is in government departments and
banks. In 1997 Nawaz Sharif government appointed 30 judges to settle 48,000
registered bank loans cases of 217 billion rupees. The reports of 193 billion
rupee loan right off from 1999 to 2009.
 The 2005 Karachi Stock Exchange Scam that cost 25,000 families allegedly
some 800 billion rupees while Islamabad, State Bank of Pakistan and Securities
and Exchange Commission looked the other way.
 A 1996 investigation by Sindh Education Department discovered that 2,932 schools in rural areas
existed only on paper. Many of the buildings had been converted into guesthouses, stables, or
storage facilities.
 Similarly, the Punjab government found that about 1,600 “ghost schools” which had not
operated for years, but the teachers continued to get paid

Impact of Corruption in Pakistan:

To a varying degree, Corruption exists in the almost all countries. However, the degree
to which corruption adversely impacts common people’s lives and increases poverty is
directly proportional to the level of corruption and how wide spread it is in the society. A
country’s or province’s development depends on how much of that country’s resources
are lost to corruption. In developed countries where corruption is limited to a small
number of projects and where common people do not encounter corruption on a daily
basis, the adverse impacts tend to be marginal and do not jeopardize the welfare of its
people. In contrast, a poor country like Pakistan, where each paisa must be spent to
uplift people from poverty, corruption has a significant impact. The following are some
examples of the damage that is caused by corruption:

 Defective or dangerous Infrastructure

Poor roads, badly constructed college buildings, schools, railway tracks, hospital
facilities, water projects, bridges or housing units.

 Inadequate Infrastructure –
Incomplete roads, fewer classrooms in schools, dams that cannot stop floods or
buildings that do not meet original requirements.

 Lack of education

Poor education standards as Schools remain unoccupied due to absence by teachers

or fewer teachers to effectively educate students. Technical and Engineering schools
that lack laboratory facilities or library books.

 Lack of hospital facilities:

Hospitals that have inadequate number of beds, no medicine for patients, and no
vehicles to transport patients to hospitals.

Eventually, the budget planners and donor countries lose confidence in the ability of an
organization to deliver improved infrastructure and become reluctant to provide further
funding. As people of rural areas are poor and cannot pay for any services, they will not
have access to educational or health institutions. Alternatively donor agencies force
privatization of infrastructure building and delivery of services giving contracts to
companies that specialize in urban areas. Such private companies often do not trust or
have confidence in the local labor and tend to bring labor from other provinces or focus
only on projects in urban areas resulting in the continued suffering of people living in
rural communities.

 Impacts of Corruption on poor’s:

Corruption affects the poor disproportionately, due to their powerlessness to change the
status quo and inability to pay bribes, creating inequalities that violate human rights.

 Corruption is a core poverty issue as viewed by the poor themselves

 Corruption affects poor's basic livelihood

 Corruption can affect poor's political choices and participation

  Corruption affects poor's access to health services

Due to the corruption phenomenon in our country, the poor is getting poorer and the rich
is getting richest day by day. Even the basic health facilities are getting away from the
poor’s. The poor’s have no access to the health services; most of them are unemployed
or having very low wedges which doesn’t fulfill their basic requirements of life.

Causes of Corruption and Current anti-corruption institutions in

Pakistan

NAB (anti corruption institution in Pakistan)

In addition to the law enforcement agency call anti-corruption department which is

largely a non-effective organization, a high-level body called National Accountability
Bureau (NAB) is supposed to ensure accountability of high officials and political leaders.
According to governance experts, the NAB is influenced by the military and largely
ignores corruption by military. Its real function appears to be a tool for those in power to
target political opponents and junior government officials. They rarely investigate cases
against judges, military, and political allies of the group that is in power. Moreover, NAB
suffers from structural limitations and its authority is widely contested. Other than
innuendo and allegations, there is hardly any high-profile cases prosecuted in Pakistan.

Causes of Corruption in Pakistan:

It is a point to ponder on why the corruption has become so rampant? What are the
causes behind its rapid growth?

 Fault in political system

Pakistan, for its faulty political system, has been facing acute administrative disorder.
Incapable and unskilled persons reach to high positions who decide the fate and future
of the nation. The ruling elite, mostly coming from feudal class, is quite indifferent to
public welfare. No matter, most of them are educated from Oxford and Cambridge, but
they lack the refinement essential for a statesman. They come into power through public
mandate, although, people elect them against their wishes. Their free will is always
threatened by the use of brutal force. The rulers are no other than the emperors of the
bye-gone age; the omnipotent masters of their empire. The state revenue seems to be
their personal property. Another class, which has a lion’s share in the finance and
economy of the state, is the capitalist. This creates in the deprived class a desire to
become over-rich. There is a mad race to over-take and over-cross each other on the
highway of life. People in order to protect themselves from this polluted situation,
because more pollution by doing undesirable things, speaking of common man, it is
observed that the average class also longs for leading the life of pomp and show. This
makes them to seek new ways of money making without any consideration of right or
wrong. Government servant’s shrinking amount of salary is too small to meet their
rightful needs. They, in order to make their both ends meet, tamper with the rules and
regulations.

 Politicization and inefficiency at top management levels

The corporate sector is also littered with failures due to corrupt practices. Scandals in
the corporate sector are subjects of headlines in the media. Wrong practices seem too
common, and unacceptable behavior has become a normal practice. Corporate
governance has been practiced only in form and not substance. Chairmen, chief
executive officers and directors are appointed on the basis of political and personal
clout. Merit is a less visible commodity. Thus politicization and inefficiency at the top
management levels has resulted in steep decline in the quality of output.

 Need and Greed

Need and greed are cited as the reasons of corruption and corrupt practices. Need as a
reason is applied to low paid employees specially those entrusted with service delivery
powers and public contact. Corruption occurs out of compulsion, as those indulging in
corruption are in need of the basic necessities and lack access to social entitlement.
However, need very easily merges with greed once need is taken as a justification by
those indulging in corruption and corrupt practices. It is because of this fact that
corruption is linked to poverty which is termed as corruption of need. Absence of an
ethical base in societal attitudes is also cited as one of the root causes of corruption.

According to the findings of National Anti- corruption Strategy and the National
corruption Perception Survey 2006 carried out by Transparency International, major
causes of corruption in Pakistan are as follows:
 Lack of effective Internal accountability mechanism
 Discretionary powers and their flagrant abuse by the public office holders
 Absence of and weakness of the watch-dog agencies
 Elected government's perpetual failure to develop proper ethical and business
 Standards for the public and private sector
 Political leaders' incompetence and betrayal of public trust with penchant for
   Self-enrichment
 Lack of transparency in the government's decision-making process
 Lengthy and cumbersome procedures in the executive system
  Weaknesses in the judicial system
 Illiterate, apathetic or ignorant populace with inadequate discernment of
    Political choices
 Power of influential people
 Inadequate wage envelope

Solution of corruption in Pakistan:

1) Whole system of government including laws and rules of country needs to be

reviewed by competent, well paid, positive and patriot, law knowing people who should
be well educated and experts of laws and rules to revalidate and improve the laws, rules
and procedures in totality. All sick laws, rules and procedures need to be improved,
changed or destroyed as per need. The rules and laws should be easy to understand,
logical and comfortable to implement

2) Fair, open and speedy trials and disposals of issues and cases according to law,
along with accountability (But the accountability should be from top to bottom and not
from bottom to top)

3) No innocent should ever suffer to any limit or be punished in any case. If by mistake it
happens that must be compensated to satisfaction of sufferer.

4) Focus to law of tort should be brought in practice to improve the norms of society as
in Europe

5) Proper and thorough monitoring towards implementation of rules and laws.

6) There must be a Better System of Government there is no any system of government

which fails if not based on injustice and discrimination.

Suggestions about the system of government required for Pakistan are

as follows:

Elected Presidential form of Government should be modified according to requirement

of our country prepared by the best experts of law having un-doubtful credibility and
integrity and should not have any concern with Government or to any political party.
 The three important tiers of government i.e. Legislative Body, Judiciary and Executive
should be independent and power full but must have counter checks on each other to
be devised in constitution for smooth system of government as well as accountable to
each other.

We must follow the fundamental concept of formulation of government which includes:

1. Rule of divine’s law given by Allah in Quran and further illustrated by Sunnah

2. Only one competent elected/selected Muslim (Having Education of Highest Level

concerning to System of Government i.e. must at least possess a valid degree of Law)
should be the head of state as in elected Presidential form of Government and not a
group as it happens in parliamentary form of Governments. Important Portfolios and
Ministries should be separate from Legislative bodies to keep the legislation impartial,
neat and clean

3. The people who have to elect rulers must be educated to some specific level i.e. the
voters must be educated to some level. It may be a minimum of matriculate or more. As
the Khalifas (Islamic Rulers) were elected or selected by the Shuraas consisting of
scholars of the time and not by general public. So only well aware people should play
role to elect/select people to form government

4. The rulers should not have any exemption before the law. The qualities required by
the leadership to come forward the leaders to come forward must have following set of
concepts and slogan

 Fear of Allah
 Vision
 Truth
 Value of time
 Value of competence
 Value of hard work
 Having concept to boost local and private enterprises
 Reliance to national resources
 Honest

Corruption can never be reduced without comprehensive justice nor without qualitative
leadership to come or brought forward Humble submission to address corruption and to
curtail it gradually the whole system of Pakistan needs review in totality i.e. all the laws,
rules and system needs reviewing and all the flaws and defective rules and laws need
to be destroyed. All the system needs to be revised and reviewed according to true
massage of Islam mainly given in Quran, along with all of system needs to be based on
comprehensive justice, reduction in government machinery at every level according to
right sizing, the whole system should be based on logic, human nature, rationalism,
justice, humanity, love, truth, humbled, vision and support.

Conclusion

The future of Pakistan and alleviation of poverty in rural areas of Pakistan is highly
dependent on successful and completion of all development projects. This success is
threatened by the evil of corruption that must be stopped on urgently before it is too late.
The religious extremism, deteriorating economic conditions, and worsening living
conditions are unnerving the people of rural Sind and Baluchistan, who until now have
refused to fall in the trap of extremism. It is imperative that all stakeholders including
political parties, government officials, civil society organizations, private companies,
donor agencies and common people recognize the carnage that current levels of
corruption can do to the heartlands of Pakistan. They must form a grand coalition to
stop the menace before it is too late.

The need of the hour is to think how to eradicate this big monster of corruption from our
society. One can’t wait for miraculous happenings. Instead of pulling up others, if people
begin the cleanup process from their own person, better results can be expected. This
is a life-long struggle and a nation achieves it objectives through evolutionary process.
People have to vow that they themselves will not try to violate the rules and laws. This
alone would help to bring purity, reformation and transparency in our socio-political set-
up. By controlling our unchecked desires, we would be able to wipe-out corruption from
Pakistan