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Thesis on the topic

CORRUPTION: the Characters Cancer

For the subject

Business Ethics & Corporate Governance

Submitted By: Anil S. Anayath (1005, MMS-II, Sem IV)

Submitted To: Prof. Nadirshaw K. Dhondy


















I, Nadirshaw K. Dhondy, Advocate Supreme Court, have examined the thesis of Anil S. Anayath, who is enrolled in Mumbai Institute of Management and Research at Unique Roll No. 1005 for the academic year 2011 2012 in the course content (Corruption the Characters Cancer)

He has submitted this thesis in part fulfillment of final exams evaluation. He has been rated to receive marks out of 40 [Forty]

Dated this 22nd day of February, 2012

Signature of the candidate


Anil S. Anayath

Nadirshaw K. Dhondy

(1005, MMS-II, Sem IV)

(Advocate Supreme Court)


I sincerely thank Prof. Nadirshaw K. Dhondy for giving me an opportunity to compile this project and also for providing necessary information which helped me in completing this project in a better manner.

I would like to acknowledge and extend my heartfelt gratitude to Hezal Upadhyay (Pursuing L.L.B from Government Law College) for her support and encouragement that has made the completion of this Project possible.

I would also like to thank the Director and the library staff of Mumbai Institute of Management and Research for the use of their collections without which this thesis would have been most difficult.

Finally, I would like to thank my family for providing with guidance and support that made me complete this thesis efficiently.


Now-a-days corruption can be seen everywhere. It is like cancer in public life, which has not become so rampant and perpetuated overnight, but in course of time. A country where leaders like Mahatma Gandhi, Sardar Patel, Lai Bahadur Shastri and Kamraj have taken birth and led a value-based is now facing the problem of corruption.

When we talk of corruption in public life, it covers corruption in politics, state governments, central governments, "business, industry and so on. Public dealing counters in most all government offices are the places where corruption most evident. If anybody does not pay for the work it is sure work won't be done. People have grown insatiable appetite for money in them and they can go to any extent to get money. Undoubtedly they talk of morality and the importance of value-based life but that is for outer show. Their inner voice is something else.

It is always crying for money. It has been seen the officers who are deputed to look into the matters of corruption turn out to be corrupt. Our leaders too are not less corrupt. Nexus between politicians and bureaucrats works in a very sophisticated manner. Nexus does also exist between criminals and police.

Corruption can be need-based or greed-based. Better governance can at least help to check need-based corruption. Better governance can check greed based corruption also because punishment for the corrupt will be very effective and prompt in a better-governed country.

Though it seems very difficult to control corruption but it is not impossible. It is not only the responsibility of the government but ours too. We can eliminate corruption if there will be joint effort. We must have some high principles to follow so that we may be models for the coming generation. Let us take a view to create an atmosphere free from corruption. That will be our highest achievement as human beings.


It is not easy to define corruption. But in a narrow sense, corruption is mostly concerned with bribery and it takes several forms. Corruption is a global phenomenon and it is omnipresent. Corruption has progressively increased and is now rampant in our society.

Wrongdoing on the part of an authority or powerful party through means that are illegitimate, immoral, or incompatible with ethical standards. Corruption

often results from patronage and is associated with bribery.

Blandly labelling something as corruption is meaningless. For example, we cannot cure cancer unless we know what type of cancer it is. The challenge is to distinguish between systemic and individual corruption; petty and grand corruption; moral and legal corruption; and rumours and reality of corruption.


1. corruption quote:







transparency. - Anonymous 2. corruption quote: The surest way to corrupt a youth is to instruct him to hold in higher esteem those who think alike than those who think differently. - Friedrich Nietzsche 3. corruption quote: Power tends to corrupt; absolute power corrupts absolutely. - Lord Acton 4. corruption quote: "Power does not corrupt men; fools, however, if they get into a position of power, corrupt power." - George Bernard Shaw

5. corruption quote:

"Power attracts the corruptible. Absolute power attracts the absolutely corruptible." - Frank Herbert

Corruption is a type of strategic action in which two or more actors undertake an exchange relation by way of a successful transfer of money (material) or power (political or status) or promoting of gene (genetic), which sidesteps legality or morality or civility to regulate the relation. It is a strategic interaction or an art of nonviolent negotiation. As mentioned before, social action is strategic when it is aimed at the successful realization of personally defined goals.

Corruption threatens people and their governments. It makes societies unfair. It is argued that bribery is a negotiated rent, as the beginning of all illegalities and tyranny. There is no more powerful engine of injustice and cruelty, for bribery destroys both faith and state. The serious consequence of corruption thus is not only State Capture but also Mind Capture. Corruption is universal. It is present in developed and developing countries, in the bureaus of public or private sectors, and in nonprofit or charitable organizations. Shift from governance to management only changes its residence. Corruption is not merely in the media or in the minds of people as it is sometimes made out.

But it is in the system all across the public services, is what this study highlights. And the users and providers of those public services know what needs to be done to address the problem as this study has brought out. Corruption plays a central role in politics thus state objectives. Rent seeking and rent giving are major obstacles in the process of planned change of economic layers. A promise of democracy remains undone. However it does allow selective change in economic-cycle of an individual, an individual household and a business. Corruption is usually a kept secret and therefore the behaviour of the corrupt agent near impossible to observe in real life. The character of rent-seeking has all the qualities one can ask for such as charm and acting talent to create a mirror image of the truth i.e., of an actor; book keeping i.e., of an accountant; to understand and manipulate rules and regulations and ability to protect, i.e. of a custodian.

Campaigns against corruption have not met with much success. It is a worrisome development. When the majority of people operate under such a system, individuals have no incentive to try to change it or to refrain from taking part in it.

Definition & Concepts


Corruption is defined as the use of public office for private gain, or in other words, use of official position, rank or status by an office bearer for his own personal benefit. Following from this definition, examples of corrupt behaviour would include: (a) bribery, (b) extortion, (c) fraud, (d) embezzlement, (e) nepotism, (f) cronyism, (g) appropriation of public assets and property for private use, and (h) influence peddling.

In this list of corrupt behaviour, activities such as fraud and embezzlement can be undertaken by an official alone and without involvement of a second party. While others such as bribery, extortion and influence peddling involve two parties the giver and taker in a corrupt deal. The two party type of corruption can arise under a variety of circumstances. Often mentioned are concerned with the following:

(i) Government contracts: bribes can influence who gets the contract, the terms of the contract, as well as terms of subcontracts when the project is implemented. (ii) Government benefits: bribes can influence the allocation of monetary benefits such as credit subsidies and favoured prices and exchange rates where price controls and multiple

exchange rates exist. Bribes can also be important in obtaining licenses and permits to engage in lucrative economic activities such as importing certain goods in high demand and in short supply. Moreover, bribes can be employed to acquire in-kind benefits such as access to privileged schools, subsidized medical care, subsidized housing and real estate, and attractive ownership stakes in enterprises that are being privatized.

(iii) Government revenue: bribes can be used to reduce the amount of taxes, fees, dues, custom duties, and electricity and other public utility charges collected from business firms and private individuals.

(iv) Time savings and regulatory avoidance: bribes can speed up the granting of permission, licenses and permits to carry out activities that are perfectly legal. This is the socalled grease money to turn the wheels of bureaucracy more smoothly, speedily and hopefully in the right direction. It is also not difficult to think of a really awful situation where rules and regulations, and the way they are applied, are so complex and burdensome that the only way left to get things done is to pay money to avoid them.

(v) Influencing outcomes of legal and regulatory processes: bribes can be used to provide incentives to regulatory authorities to refrain from taking action, and to look the other way, when private parties engage in activities that are in violation of existing laws, rules and regulations such as those relating to controlling pollution, preventing health hazards, or promoting public safety as in the case of building codes and traffic regulations. Similarly, bribes can be given to favour one party over another in court cases or in other legal and regulatory proceedings.

When money replaces god, immorality and corruption thrive. Gone are the good old days when people were hesitant to do something wrong because morality had a place in society. Wrong doers would do bad things away from the sight of the society. Things are just the opposite in modern society. Now you can hide behind brilliant twists of logic and do any thing. You may even be admired at your smartness that no one could catch you. Corruption is an age-old phenomenon; however, whenever it had gone beyond control it had destroyed societies and nations. And why not? Corruption, in any language, means destruction, ruining or spoiling; it is a slow and deceptive poison.

Power does not corrupt men; fools, however, if they get into a position of power, corrupt power. George Bernard Shaw

Corruption is the abuse of public power for private gain. It can take many different guises: bribery, misappropriations of public goods, nepotism (favoring family members for jobs and contracts), and influencing the formulation of laws or regulations for private gain. Corruption is also not just the clearly bad cases of government officials skimming off money for their own benefit. It also means creating bad laws so that the systems doesnt work well, and ordinary people are left in a bind, needing to bribe to get any work done.


Bribery: An offer of money or favours to influence a public official. Nepotism: Favouritism shown by public officials to relatives or close friends. Fraud: Cheating the government through deceit. Embezzlement: Stealing money or other government property.

In talking about different types of corruption, an important distinction is between administrative corruption and political corruption.

Administrative Corruption: Corruption that alters the implementation of policies, such as getting a license even if you dont qualify for it Political Corruption: Corruption that influences the formulation of laws, regulations, and policies, such as revoking all licenses, and gaining the sole right to operate the beer or gas monopoly.

Another important distinction is between grand corruption and petty corruption.

Grand Corruption: Corruption involving substantial amounts of money and usually high-level officials.

Petty Corruption: Corruption involving smaller sums and typically more junior officials.

Taking a worldwide perspective, countries like New Zealand and the Scandinavian countries are "models of integrity" for the world in terms of their corruption control. And almost all of the most corrupt countries are developing nations and many of them are in Asia. Among the Top 20 most corrupt states in the world, a half of them are in Asia; Myanmar (Burma), Afghanistan, Kyrgyzstan, Turkmenistan, Tajikistan, Indonesia, Bangladesh, Cambodia, Laos and Pakistan are all on the list, according


to the Worldwide Governance Indicators. And India and China are the two "most corrupt trade nations" among the world's Top 30 exporting countries. Corruption is a way of life across Asia. While talking about high-level corruption in Asia's three largest countries -India, China and Indonesia -- there is a saying, "In India, corruption is under the table; in China, it is over the table; and in Indonesia, corruption includes the table." Whichever way one may wish to read the proverb, "what remains undeniable," says Chan Akya of Asia Times, "is that corruption is more firmly rooted in Asian culture than is commonly acknowledged."

Why are Asian politicians and bureaucrats so corrupt? Some analysts believe that in Asian culture, corruption helps "grease the wheels" of an otherwise inefficient bureaucracy and economy. Others argue that Asia's "corruption culture" is based on traditional Asian emphasis on "rule of man," not "rule of law," and law is seen as malleable, not absolute. Whether a cultural flaw or a symptom of a sick state, however, the severity of corruption in Asian states and the failure to contain such endemic corruption among political leaders and government officials poses one of the most serious threats to Asia's future economic development and political stability.

Corruption in India is a consequence of the nexus between Bureaucracy, politics and criminals. India is now no longer considered a soft state. It has now become a consideration state where everything can be had for a consideration. Today, the number of ministers with an honest image can be counted on fingers. At one time, bribe was paid

for getting wrong things done but now bribe is paid for getting right things done at right time. In India, corruption attacks the fundamental values of human dignity and political equality of the people and hence there is a pressing need to formulate a fundamental human right to corruption-free service. The development of a fundamental human right to a corruption-free society will be observed initially from an international perspective so as to elevate the violation of this right to the status of an international crime. This would provide the comparative basis to elevate the right to corruption-free service to the status of a fundamental right within the framework of the Indian Constitution.

One of the definitions of the term corruption is "giving something to someone with power so that he will abuse his power and act favouring the giver". Another definition is "the offering, giving, soliciting or acceptance of an inducement or reward, which may influence the action of any person". It includes bribery and extortion which involve at least two parties, and other types of malfeasance that a public official can commit alone, including fraud and embezzlement. The appropriation of public assets for private use and the embezzlement of public funds by politicians and bureaucrats have such clear and direct adverse impact on India's economic development that their costs do not warrant any complex economic analysis. There are many myths about corruption, which have to be exploded if we really want to combat it. Some of these myths are: Corruption is a way of life and nothing can be done about it. Only people from underdeveloped or developing countries are prone to corruption. We will have to guard against all these crude fallacies while planning measures to fight corruption. As with many developing nations, corruption is widespread in India. India is ranked 85 out of a 179 countries in Transparency International's Corruption Perceptions Index,

although its score has improved consistently from 2.7 in 2002 to 3.4 in 2008.Corruption has taken the role of a pervasive aspect of Indian politics and bureaucracy. The size of Indias parallel economy at 40% of GDP does provide fertile ground for corruption. Lack of deterrence against corruption and importance to wealth begotten by whatever means enormously promoted corruption in India. More important, corruption in India flows from above from the political class under covers like party and election funds, and senior bureaucrats who are seld investigated or punished, either through conspiratorial silence or through conspiratorial legislative manipulations. Further, political patronage gave an aura of invincibility and respectability to corruption and deprived it of all moral and legal fears. The Central Bureau of Investigation in the Centre and Criminal Investigation Departments in the states and Union Territories have become political tools in the hands of the ruling party and grossly politicised the criminal investigation process in the country. What is worse, the conviction rate is hardly 6% in criminal cases. Corruption flourishes in India because it is perceived t o be a low risk and high profit business. Lack of transparency in administration provides an opportunity for public servants to mislead citizens and extract bribes. It is only the Supreme Court in India seems waging a war against corruption. The Government of India converted the Central Vigilance Commission into a statutory body through an executive order in 1998 on the directive of the Supreme Court. It rendered the CVC at least statutorily independent of the political and bureaucratic set -ups. Indian administration is tainted with scandals. India is among 55 of the 106 countries where corruption is rampant, according to the Corruption Perception Index 2004 Report released by Transparency International India. Corruption in India leads to promotion not prison. It is very difficult to catch big sharks. Corruption in India has wings not wheels. As nation grows, the corrupt also grow to invent new methods of cheating the government and public.

The significance of corruption as a factor that adversely affects the growth of a country is being increasingly recognized. Corruption, in the words of Indira Gandhi, is a world phenomenon. It exists in developed countries too. Corruption is institutionalized as a part of the democratic process in the USA as lobbying and public relations activities and the country prides in its mushrooming lobbying and public relations firms with major foreign governments inter alios as its clients. The firms are nothing bu t mammoth

business houses indulging in legal corruption. This no how justifies corruption other where. Indian corruption has special characteristics that make it far more damaging than corruption in other parts of the world. First, people in India being poor and largely dependent on the Government for decent living and even survival, and limited by its excessive laws, rules, regulations and largess in almost all activities of life with high rates of taxation on every conceivable items and services, corruption literally sucks life out of their existence unlike those in developed countries whose dependence on the Government is relatively not so deep and prolate. This renders corruption in India an extremely dangerous phenomenon with terminal consequences on the culture, value system and the quality and the content of the life of the people.

Second, corruption in India flows down from above. Corruption at the top affects key decisions and policies with sweeping implications while core decisions in developed countries are taken on merit through transparent competition.

The chief economic consequences of corruption are the loss to the exchequer, an unhealthy climate for investment and an increase in the cost of government -subsidized services. India still ranks in the bottom quartile of developing nations in terms of the ease of doing business, and compared to China and other lower developed Asian nations, the average time taken to secure the clearances for a startup or to invoke bankruptcy is much greater.

Why Should We Care?

In nations with similar societies the average income in corrupt countries is about three times lower than in less corrupt countries (the difference or between, even say,

Ukraine and Czech Namibia).

Republic, Indonesia and South


Chad and

When the ruling elites become corrupt, governance begins to rot and ordinary people begin to lose faith in the ruling class. Such a society begins to decay and sets itself on the road to self-destruction. A state of unchecked political corruption is known

as kleptocracy, which literally means rule by thieves. There are well known dictators in recent decades who did nothing but plunder their countries and robbed their own people (read Worlds Top Ten Corrupt Leaders).

According to World Bank estimates, between $1 trillion and $1.6 trillion dollars are lost globally to illegal activities each year. Corruption decreases the amount of wealth in a country and lowers the standard of living. Corruption affects you even if you dont come into direct contact with it. For example, corruption:

Vitiates the business atmosphere which reduces opportunities for all. Reduces governments tax collection and degrades the quality of government services such as education, healthcare, infrastructure, welfare programs, police, etc

Is an important factor behind the widespread global poverty. Allows criminal activities such as money laundering, extortion and drug trafficking to thrive. Think of how the terrorists activities are funded. Allows the rich and powerful to bend laws in their favor at the cost of others. Puts weaker section of the society to disadvantage because those with less power are particularly disadvantaged in corrupt systems, which typically reinforce gender discrimination.

Distorts national and international trade. Jeopardizes sound governance and ethics in the private sector. Undermines openness, fairness and the rule of law.

According to Transparency Internationals 2010 Corruption Perception Index (CPI) that ranks countries on corruption scale Somalia, Myanmar, Afghanistan, Iraq and Turkmenistan are the top most corrupt countries in the world. At the other end of the spectrum, the list of cleanest or the least corrupt countries is headed by Denmark, New Zealand, Singapore, Finland, and Sweden UK, USA and France at the tail end.



People offer bribes because they want an unfair advantage over othersto pay lower taxes, to get an appointment or promotion, to win a contract, or to get something done quickly. They also may offer bribes to avoid a fine or penalty. People seek bribes for several reasons that are special for them.

For example: Politicians seek money to use for patronage. They may argue that to stop such payments could bring political instability and unrest. Politicians and officials who fear loss of office seek corrupt benefits as insurance, especially if they can expect no pension. Officials need extra money to maintain their standards of living if salaries have not been raised to match inflation, to meet commitments for housing, car, school fees, etc. Employees feel resentment over bad management or pay levels they think unfair. This may make them feel justified in making false expense claims or taking bribes. Employees who refuse to participate in a corruption racket may be suspected and under threat from their colleagues or superiors. Some seek status, not only for having more riches than their colleagues but because corrupt officials may be admired by friends and family for their skills in outwitting authority.


As per the composite ranking of states on petty corruption, involving common citizen And in the context of eleven public services, Kerala stands out as the least corrupt State In India. Bihar, on the other hand is the most corrupt State. In fact, on all parameters and in the context of all the eleven services, Bihar stands out as the most corrupt State. Himachal Pradesh is less corrupt even compared to States like Tamil Nadu, Maharashtra or Gujarat. Madhya Pradesh, Karnataka, Rajasthan and Assam are afflicted with the problem and score high on the index.


States highlights
Kerala: All 11 public services considered for the study are ranked as the least corrupt in the country.

Himachal Pradesh: Most services in the State are ranked as relatively lower corrupt in the country.

Gujarat: Overall the State is ranked as less corrupt in comparison to other States. However certain services like Education, Land Administration and Judiciary are relatively ranked as more corrupt in comparison to others services in the State.


Andhra Pradesh: Govt Hospital and Water Supply services are ranked more corrupt in comparison to other services in the State . Maharashtra: Municipal services in the State rank among the top five corrupt in the country.

Chhattisgarh: On the corruption index all the services in the State are much better ranked than the parent State Madhya Pradesh

Punjab: PDS, Police, Judiciary and Municipal services are ranked more corrupt in comparison to other services in the State.

West Bengal: Water Supply service in the State is ranked as the most corrupt in the country.

Orissa: Judiciary ranks among the top four corrupt in the country

Uttar Pradesh: Electricity, Schools and Income Tax figure high in the corruption rankings.

Delhi: PDS in Delhi is ranked as the second most corrupt in the country

Tamil Nadu: While over all the State ranks 12th on the Corruption Index, Schools, Hospital, Income Tax and Municipalities rank among the top corrupt in the country. This is surprising given that the State has one of the best health infrastructure and also ranks quite high on the Education Development Index.

Haryana: Schools, Land Administration and Police figure among the top corrupt in the country.

Jharkhand: On the corruption index all the services in the State are much better ranked than the parent State Bihar.

Assam: Police is the most corrupt in the country. Electricity figures among the top corrupt.

Rajasthan: Judiciary ranks among the less corrupt in the country

Karnataka: The state ranks fourth on the corruption index because key services like Income Tax, Judiciary, Municipalities & RFI figure among the top corrupt services in the country. However, Electricity & Schools rank among the least corrupt in the country.

Madhya Pradesh: Despite initiating reforms in service delivery, the State still ranks as third most corrupt among States included in the survey. Only Municipal services are ranked relatively better than other services.

J&K: Except Hospital & RFI, most other services rank among most corrupt in the country. Not surprising that it is the second most corrupt State.

Bihar: All the services are ranked among the most corrupt in the country.


Corruption and its impact on governance in India

Corruption affects India at all levels of governmental decision-making and in the distribution of state largesse. India is ranked 72nd out of 91 countries in the Corruption Perception Index, 2001, prepared by Transparency International (TI). Corruption in India not only poses a significant danger to the quality of governance, but also threatens in an accelerated manner the very foundations of its democracy and statehood. The recent revelations of corrupt practices in defence purchases and related contracts not only tend to undermine the security of the Indian state, but also fundamentally shake the people's trust and belief in the Government of India and its institutions.


The mid-1960s are perceived to be the great divide in the history of governance administration in India. It paved the way for the blurring of the Gandhian and Nehru era of principled politics and the emergence of a new system of politics that began to tolerate and even encourage dishonesty and corruption. The scams and scandals of the 1990s revealed that among the persons accused of corruption were former Prime Ministers, Chief Ministers, Governors and even members of the judiciary. India's experience with corruption has shown that laws, rules, regulations, procedures and methods of transaction of government business, however sound and excellent they are, cannot by themselves ensure effective and transparent administration if the political and administrative leadership that is entrusted with their enforcement fails to do so and abuses its powers for personal gain (Sunil Sondhi, 2000).

Gunnar Myrdal has described Indian society as a "soft society". According to him, a soft society is one that does not have the political will to enact laws that are necessary for its progress and development and/or does not possess the political will to implement the laws, even when made, and one where there is no discipline. He has stressed that if there is no discipline in society, no real or meaningful development or progress is possible. Corruption and indiscipline survive on each other's willingness to accommodate, tolerate and provide encouragement. Corruption affects governance in a significant manner and it is anti-poor. For instance, a substantial portion of food grains, sugar and kerosene meant for the public distribution system (PDS) and for welfare schemes for the poor, including the Scheduled Castes (S.C.s) and the Scheduled Tribes (S.T.s), goes into the black market. Hardly 16 per cent of the funds meant for the S.T.s and the S.C.s reach them (Consultation Paper on Probity

in Governance, National Commission to Review the Working of the Constitution, 2001). The rest are misappropriated by members of the political and official classes and unscrupulous dealers and businessmen.

Like other social evils, the problem of corruption brings out numerous responses. As a lawyer, my response would inevitably involve changes in the laws and in this case an amendment to the Constitution. While I propose this amendment, I am mindful of the inherent weaknesses of any law or legal response if the enforcement mechanism is weak that would only amount to paying lip service to the law. This may be the case with several other laws, mostly criminal laws that are already in place to punish the corrupt, or for that matter the case of anti-terrorism laws, which are available in plenty even as the present government enacted the Prevention of Terrorism Act.


Corruption has flourished in India because of the drawbacks of the criminal justice system. We see more and more examples of acquittals in corruption cases. Several corruption-related cases filed in India in the recent past were poorly founded upon, were backed by incomplete and inefficient investigation, and were followed by delayed trials that resulted in morally ill-deserved but legally inevitable acquittals.

The 2011 corruption rankings for 180 countries in the World Democracy Audit are listed below:
Country Corruption Rank2011 Democracy Rank2011

New Zealand Denmark Finland Sweden Singapore Norway Netherlands Switzerland

1 2 2 4 5 6 7 8

4 3 1 2 72 5 6 7

Australia Canada Germany Japan Austria United Kingdom Ireland Belgium Chile United States Uruguay France United Arab Emirates Estonia Spain Portugal Taiwan Botswana Slovenia Israel Bhutan Poland Korea, South Mauritius Rwanda Oman Costa Rica

8 10 11 11 13 13 15 15 17 18 19 19 21 22 23 24 24 24 27 28 29 30 31 32 33 34 34

9 8 11 29 14 13 12 10 20 15 18 16 74 17 21 19 30 39 22 31 73 24 33 32 100 85 23


Lithuania Hungary Kuwait Jordan Saudi Arabia Czech Republic Namibia Malaysia Turkey Latvia Cuba South Africa Georgia Slovakia Croatia Ghana Macedonia Italy Tunisia Brazil Romania China Lesotho The Gambia El Salvador Greece Colombia

34 37 37 39 40 40 40 43 44 44 44 47 47 49 49 51 51 51 54 54 56 56 58 58 60 60 60

25 28 76 81 111 26 42 82 56 40 124 43 78 27 37 34 53 35 120 50 51 121 57 118 52 36 83


Peru Thailand Morocco Bulgaria Panama Serbia Jamaica Sri Lanka Trinidad & Tobago Liberia Bosnia Zambia India Albania Malawi Burkina Faso Mexico Argentina Gabon Benin Indonesia Tanzania Madagascar Egypt Moldova Senegal Algeria

60 60 60 66 66 66 66 66 71 71 71 71 75 75 77 77 77 77 77 77 77 77 77 86 86 86 86

54 89 100 47 38 46 41 109 44 87 79 92 49 61 86 76 69 63 111 48 64 60 80 106 67 66 99


Vietnam Bolivia Mali Guatemala Kazakhstan Mongolia Ethiopia Mozambique Ecuador Bangladesh Iran Dominican Republic Armenia Syria Honduras Philippines Niger Eritrea Nicaragua Lebanon Sierra Leone Pakistan Cameroon Uganda Belarus Nigeria Togo

86 91 91 93 93 93 93 93 93 93 93 101 101 101 101 101 106 106 106 106 106 106 106 113 113 113 113

128 59 45 96 127 55 126 80 65 87 142 58 111 135 104 62 100 143 83 89 68 106 115 94 143 89 121


Azerbaijan Mauritania Russia Ukraine Tajikistan Zimbabwe Nepal Paraguay Cote d'Ivoire Kenya Papua New Guinea Central African Republic Laos Guinea-Bissau Congo, Republic of Yemen Cambodia Kyrgyzstan Guinea Libya Angola Chad Congo Venezuela Burundi Haiti Iraq

113 113 113 120 120 122 122 122 122 122 122 122 122 122 122 132 132 132 132 136 136 136 136 140 140 142 142

129 92 133 70 129 136 108 71 118 96 74 111 141 104 96 139 115 121 109 145 117 129 138 133 129 95 124


Turkmenistan Uzbekistan Sudan Myanmar Afghanistan Somalia

144 144 144 147 147 149

149 147 139 148 137 145

National scenario
Corruption in India is a consequence of the nexus between Bureaucracy, politics and criminals. India is now no longer considered a soft state. It has now become a consideration state where everything can be had for a consideration. Today, the number of ministers with an honest image can be counted on fingers. At one time, bribe was paid for getting wrong things done but now bribe is paid for getting right things done at right time.


Effects of corruption
Indian administration is tainted with scandals. India is one among 55 of the 106 countries where corruption is rampant, according to the Corruption Perception Index 2004 Report released by Transparency International India. Corruption in India leads to promotion not prison. It is very difficult to catch big sharks. Corruption in India has wings not wheels. As nation grows, the corrupt also grow to invent new methods of cheating the government and public.


Causes of corruption
The causes of corruption are many and complex. Following are some of the causes of corruption:

Emergence of political elite who believe in interest-oriented rather than nationoriented programmes and policies.

Artificial scarcity created by the people with malevolent intentions wrecks the fabric of the economy.

Corruption is caused as well as increased because of the change in the value system and ethical qualities of men who administer. The old ideals of morality, service and honesty are regarded as an achronistic.

Tolerance of people towards corruption, complete lack of intense public outcry against corruption and the absence of strong public forum to oppose corruption allow corruption to reign over people.

Vast size of population coupled with widespread illiteracy and the poor economic infrastructure lead to endemic corruption in public life.

In a highly inflationary economy, low salaries of government officials compel them to resort to the road of corruption. Graduates from IIMs with no experience draw a far handsome salary than what government secretaries draw.

Complex laws and procedures alienate common people to ask for any help from government.

Election time is a time when corruption is at its peak level. Big industrialist fund politicians to meet high cost of election and ultimately to seek personal favour. Bribery to politicians buys influence, and bribery by politicians buys votes.


In order to get elected, politicians bribe poor illiterate people, who are slogging for two times meal.


Measures to combat corruption

Is it possible to contain corruption in our society? Corruption is a cancer, which every Indian must strive to cure. Many new leaders when come into power declare their determination to eradicate corruption but soon they themselves become corrupt and start amassing huge wealth.

There are many myths about corruption, which have to be exploded if we really want to combat it. Some of these myths are: Corruption is a way of life and nothing can be done about it. Only people from underdeveloped or developing countries are prone to corruption. We will have to guard against all these crude fallacies while planning measures to fight corruption.

Foolproof laws should be made so that there is no room for discretion for politicians and bureaucrats. The role of the politician should be minimized. Application of the evolved policies should be left in the hands of independent commission or authority in each area of public interest. Decision of the commission or authority should be challengeable only in the courts.

Cooperation of the people has to be obtained for successfully containing corruption. People should have a right to recall the elected representatives if they see them becoming indifferent to the electorate.

Funding of elections is at the core of political corruption. Electoral reforms are crucial in this regard. Several reforms like: State funding of election expenses for the candidates; strict enforcement of statutory requirements like holding inparty elections, making political parties get their accounts audited regularly and filing income-tax returns; denying persons with criminal records a chance to contest elections, should be brought in.


Responsiveness, accountability and transparency are a must for a clean system. Bureaucracy, the backbone of good governance, should be made more citizen friendly, accountable, ethical and transparent.

More and more courts should be opened for speedy & inexpensive justice so that cases dont linger in courts for years and justice is delivered on time.

Local bodies, Independent of the government, like Lokpals, Lokadalats, CVCs and Vigilance Commissions should be formed to provide speedy justice with low expenses.

A new Fundamental Right viz. Right to Information should be introduced, which will also empower the citizens to ask for the information they want. Barring some confidentiality in information, which concerns national and international security, other information should be made available to general public as and when required. Stringent actions against the corrupt officials will certainly have a deterrent impact.



Alatas, Hussein S., 1999. Corruption and the Destiny of Asia (Singapore, Simon and Schuster (Asia) Pte. Ltd.).

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Kiltgaard, Robert, 1998. International cooperation cooperation against corruption, IMF/World Bank, Finance and Development, 35(1): 3.

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Corruption is an intractable problem. It is like diabetes, can only be controlled, but not totally eliminated. It may not be possible to root out corruption completely at all levels but it is possible to contain it within tolerable limits. Honest and dedicated persons in public life, control over electoral expenses could be the most important prescriptions to combat corruption.

Corruption has a corrosive impact on our economy. It worsens our image in international market and leads to loss of overseas opportunities. Corruption is a global problem that all countries of the world have to confront, solutions, however, can only be home grown. We have tolerated corruption for so long. The time has now come to root it out from its roots.

Decline in general perception about corruption in public services compared to ICS 2005; old or young, respondents by and large hold similar opinion. Rural households experience of corruption in general is down by half, from 56 percent to 28 percent but more importantly service specific experience of corruption has shown a rise. Difference between perception and experience about corruption in the four public services is narrowing down, ranges between 20 and 25 percentage points (2010) against 44 to 60 percentage points in 2005. With 95 percent of the households who are asked for bribes end up paying it, brings out that grievance redressal system continues to be poor and lack of accountability of public service providers, despite all claims otherwise made by these agencies.


Service specific
PDS-Compared to 2005, lesser percentage of rural households interacted with PDS (from 70% in 05 to 42% in 10). As high as 6 percent rural households were deprived of service under PDS as they could not afford to pay bribe during that period. School (up to class 12th) Though perception about corruption in school services has shown positive trend, 15 percent rural households paid bribe to avail school specific service. And another 5 percent could not avail the service during that period as they could not afford to pay bribe. Water Supply (Drinking and Irrigation)-Compared to other three services, lesser percentage of the rural households (30%) interacted with this service during the previous one year. Of these rural households, one out of five was asked to pay bribe for reasons like to get irrigation water or to get a government-owned water source repaired. Hospital Services- Compared to ICS 2005, the perception about corruption in hospital services has not changed significantly. But, around 20 percent paid bribe to avail service of government hospitals, while 5 percent were deprived as they did not pay bribe.