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Freedom from British Only to Be Slaves of Ourselves

(The Menace of Corruption- Must Read)

This article is dedicated to all those die hard honest public servants who have stood by their morale and never buckled under
pressure from their political bosses even at the risk of their being transferred to punishment posting, denial of promotion and
even framing them in false cases.

In 1922, the noted freedom fighter Mr. C. Rajgopalachari wrote in his prison diary that "elections and corruption, injustice
and the power and tyranny of wealth and inefficiency of administration will make hell of life as soon as freedom is given to
us. The only thing gained from independence will be that as a race, we will be saved from dishonor and
subordination".(Courtesy Professor Dr. Prem Lal Joshi )

1. What is Corruption?

Corruption is a multifaceted phenomenon supported by differing historical and socio-economic conditions in each country.
Corruption means the destruction, ruining or the spoiling of a society or a nation. Legally corruption is defined as "use of
public power for private advantage in ways which transgresses some formal rule or law". A corrupt society stops valuing
integrity, virtue or moral principles. Such a society begins to decay and sets itself on the road to self destruction. A corrupt
society is characterized by immorality and lack of fear and lack of respect for the law. Corruption is the misuse of entrusted
power for private gain. Types of corruption are:

a) According to rule corruption: Facilitation payments, where a bribe is paid to receive preferential treatment
for something that the bribe receiver is required to do by law.

b) Against the rule corruption: It is a bribe paid to obtain services the bribe receiver is prohibited from

c) Need Based corruption: It is the result of the fear of survival.

d) Greed based corruption: it is the result of human being’s desire to be a man of Significance having all
luxuries of life.

2. Types of Corruption

Corruption in several forms prevails all over the world with bribery alone crossing one trillion US dollars annually. A bribe
is a payment given personally to a government official in exchange of his use of official powers. Bribes may be demanded in
order for an official to do something he is already paid to do. They may also be demanded in order to bypass laws and

a) Active bribery: Promising, offering or giving by any person, directly or indirectly, of any undue advantage to
any public official, for himself or for anyone else, for him to act or refrain from acting in the exercise of his

b) Passive bribery: A request or receipt by any public official, directly or indirectly, of any undue advantage,
for himself or for anyone else, or the acceptance of an offer or a promise of such an advantage, to act or refrain from
acting in the exercise of his functions.

c) Trading in influence, refers to the situation where a person is selling his influence over the decision process
involving a third party act on behalf of powerful clients such as industrial groups who want to avoid the passing of
certain environmental, social, or other regulations perceived as too stringent, etc.

d) Patronage refers to favoring supporters, for example with government employment. In non democracies
many government officials are often selected for loyalty rather than ability.

e) Nepotism: Favoring relatives or Cronyism: favoring personal friends of an official for illegitimate private
f) Electoral fraud: Illegal interference with the process of an election by increasing the vote share of the
favored candidate, depressing the vote share of the rival candidates, illegal voter registration, intimidation at polls,
and improper vote counting.

g) Embezzlement is outright theft of entrusted funds. It is a misappropriation of property

h) Kickback is an official's share of misappropriated funds allocated from his or her organization to an
organization involved in corrupt bidding.

i) An unholy alliance is a coalition among seemingly antagonistic groups for ad hoc or hidden gain. By its
deceptive nature and often great financial resources, an unholy alliance can be much more dangerous to the public

j) Involvement in organized crime: For example a high ranking minister also operating as a gang leader
involved in drug trafficking.

3. Causes of Corruption

a) Discretionary powers which are used against not-so-well-placed citizens, who are left with no option except
either to accept, deny or delay with no accountability to the political bosses and complete lack of transparency

b) Lot of futile and redundant bureaucratic and administrative procedures.

c) State sponsored religious differences for vote bank politics.

d) Collusion between executive, judiciary and legislature with no accountability and performance as per
functions laid out by constitution.

e) Absorption of many factionists, criminals etc. into intellectual system thus creating a fear based political
system which is exploited to breed illegal businesses, scams, false harassment cases etc.

f) Sale of political poll tickets and exploitation of illiterate masses by the elected politicians to loot to recover
their investment through corruption means.

g) State sponsored scams with deliberate loopholes installed in the system by policy makers and implementations
thereof during scams to influence, judiciary, police and anti graft institutions, which are proxies and puppets of the
system roped into for investigation much after scams have looted its maximum.

h) Forced unification of diverse cultures, castes , regions and religions into single nation through suppression and

4. Consequences & Cost of Corruption

a) Political corruption constitutes a major obstacle to democracy and the rule of law.

b) Economic corruption leads to the depletion of national wealth and hinders the development of fair market
structures and distorts competition, thereby deterring investment.

c) Social Corruption Frustration and general apathy among a disillusioned public which result in a weak civil
society. Those unwilling to comply with corrupt practices often emigrate, leaving the country drained of its most
able and most honest citizens.

d) Environmental Corruption Developed countries exporting its polluting industry to the underdeveloped and
developing countries. Careless exploitation of natural resources has led to ravaged natural environments.

5. Corruption thus gives birth to a new system of governance with ample opportunities for individuals and groups to seize
and hold political power resulting in a dangerous emergence of a "nexus between corrupt politicians and public servants and
unlawful elements in society".


1. Corruption is India's cancer. A rotting tumor dedicated to vices of those in power where a bribe is the only way to
get work done. Instead of being known as a democratic nation India may well be termed as kleptocacy which literally means
“Rule by Thieves”.

2. Level of corruption in India

In 2009, India was ranked 84 out 180 countries in the Corruption Perceptions Index with an integrity rating of 3.2-3.6
indicating that the country is perceived to be highly corrupt by experts. The people indulging in corrupt practices are
working overtime. So for every positive measure to tackle corruption, those corrupt people are working twice as hard to

India has thereafter slipped to the 87th spot in Transparency International's latest ranking of nations based on the level of
corruption from the 84th position as reflected by Corruption Perceptions Index (CPI) which is even below Ghana and
Rwanda. . The government is battling corruption allegations in allotment of second generation spectrum to telecom
companies in 2008. The latest in the series is the bribes for-loan scandal involving some state-run lenders and real estate
firms. Thus it may well be said that in India Power corrupts; absolute power corrupts absolutely. Look at the Political
corruption elections in Bihar where more than a quarter of candidates from the main political parties, by their own admission,
are millionaires.

What else you need to know than that India is a signatory to UNCAC - United Nations Convention against Corruption but
has not ratified the same and made applicable to India.

3. Institutions to check corruption

a) Central Vigilance Commission

b) Comptroller & Auditor General

c) Central Bureau of Investigation (CBI),

d) States have anti-corruption bureaus manned by police officers.

4. Central Vigilance Commissioner :- Mr. P. J. Thomas was recently appointed the CVC of India. But according to the
Supreme Court Mr. Thomas is not a person of integrity and lacs the tenability of Chief Vigilance Commissioner supervising
the CBI's investigations into the 2G spectrum scandal as he himself was Telecom Secretary at the relevant point of time. Well
just to remind, the CVC is also an accused in a case filed in 1991 involving irregular import of 2.8 crore palmolein. What a
pity? The Moral police himself is immoral.

5. 2 G Raja spectrum scam: The Telecom Minister A Raja robbed the nation in the allotment of license and the
spectrum for additional cellular operators (2G operators) by ignoring the multi-stage bidding process followed with
auctioning for the license fee. The nation has lost about Rs. 1,00,000 Crore in the process as the licences which were allotted
for about Rs. 6000 Crores were later sold at about 7 times the price they had paid without doing any development at all. The
ministry went out of its way to facilitate the immediate selling of these licenses for speculative gains without any lock-in
measures which led to windfall profits for the new licensees. The scandal swept up as high as Prime Minister Manmohan
Singh, who had to explain to the Supreme Court why he sat on a request for permission to charge Raja with corruption.

The UPA government is complicit in the scam refusing to intervene in the loot stating that this was a corporate issue and the
government had no role to play, never mind the fact that they were the ones who had issued licenses at such ridiculously low
prices. Mr. A. Raja also dragged the PMO by stating that he has sought guidance and permission from the Prime Minister at
every stage. On the top of it Mr. Raja's calmly states that he has actually served the country by eliminating monopolies,
lowering tariffs, and raising growth of cellular usage.
The presumptive loss of Rs 1.76 lakh crore is based on the 3G auction prices.

6. Black Money in Swiss Bank: According to Veteran BJP leader Shri L.K. Advani, Indians have "topped the list of
black money depositors at the (in)famous Union Bank of Switzerland (UBS)" and it vary from $500 billion ( R 25 lakh
crores) to $1.4 trillion ( R 70 lakh crores)". The math of the loot may be disputed, but the fact of the loot cannot be," Further
Mr. Dev Kar, formerly a Senior Economist at the International Monetary Fund (IMF), and now a Lead Economist at Global
Financial Integrity (GFI) at the Center for International Policy produces some startling facts about corruption in India. He
states that India's underground economy is closely tied to illicit financial outflows. The total present value of India's illicit
assets held abroad ($462 billion) accounts for approximately 72 percent of India's underground economy. This means that
almost three-quarters of the illicit assets comprising India's underground economy—which has been estimated to account for
50 percent of India's GDP (approximately $640 billion at the end of 2008)—ends up outside of the country. The finding that
only 27.8 percent of India's illicit assets are held domestically support arguments that the desire to amass wealth illegally
without attracting government attention is one of the primary motivations behind the cross-border transfer of illicit capital.

7. Corruption Conviction Rate: - A large number of public servants and their aides and associates have been charge
sheeted and whose cases are pending in various courts for over a decade. When it comes to convictions, things are grimmer –
India has a conviction rate of about 42%, which must be one of the lowest in the world. The wheels of justice grind so slowly
that most victims give up. Justice delayed means the corrupt go scot-free.

8. Politics of coalition

a) There is no dearth of regional political parties at almost each state level. These parties have overshadowed the
National parties like Congress and BJP. For forming government the national parties have to take help of these
regional parties who dictate their own terms of extending their support. A Raja Telecom ministry is the result of
such coalition government. Can you imagine in a democratic country like India the single largest party may have no
say in the formation of government while one man party headed by Mr. Madhu Koda becomes the chief minister of
Jharkhand State. No price for guesses, he is behind bar for a scam of about Rs. 8000 crore.

b) The total spending for the 2009 Lok Sabha elections is pegged at a whopping Rs. 10,000 crore. The breakup of
this spending throws up some interesting insights too.

a. Rs 1,300 crore (Rs 13 billion) by the Election Commission

b. Rs 700 crore (Rs 7 billion) by the Centre and state governments

c. Rs 8,000 crore (Rs 80 billion) were spent by political parties and individual candidates

9. Bureaucratic Corruption :- Who is to be blamed for all this, the pointer is directing towards our political system and
abusive Bureaucratic and administrative setups. , Armed with thousands of laws, about 20% of population is public servants
who exercise their Powers, control and regulate the remaining 80% of the population. Of the 20% about 90 percent public
servants are, class III and class IV employees. Thus just 2% Power is concentrated in the hands of public servants who
regulate and control the fate of 80% of the population. This minority has the potential to indulge into corruption in all its
forms and scale giving India an image of one of the most corrupt countries of the world. The remaining 98% of public
servants with limited powers can indulge in petty corruption only. For these Bureaucrats the priority of interest as under:

1) Self is first, 2) Party is second, 3) Cadre is third, 4) Nation is fourth, and 5) People the last.

10. Industrial Corruption :-It takes guts and proper education to admit that an ex-minister asked for 15 crores (150
million) rupees bribe from Tata group chairman, Ratan Tata to grant license for its aviation business. The CBDT has asked a
committee to probe taped commercial transactions of corporate lobbyist Niira Radia and Tata Realty and Infrastructure Ltd
(TRIL), a Tata group firm, and real estate firm Unitech, in 2007, among others. The government is investigating if Unitech
used the money to pay for the telecom licence it was awarded in early 2008. Unitech paid the Department of Telecom 1,651
crore in January, 2008, for the 2G licence. It did not have any experience in the telecom sector and was a real estate firm
then. In October, 2008, Unitech formed Uninor, a joint venture with Norwegian teleco Telenor. It paid 6,200 crore for new
shares in Uninor.

11. Judicial Corruption

a) Of all the four pillars of a democratic nation like India, Judiciary was seen with utmost respect and corruption
was perceived to the minimum there. But of late the spate of confliction between judiciary inter se and qua the
government has also joined the band wagon of immoral practices. The Economic Times’ Political Bureau reported
that Supreme Court judge HL Gokhale has contradicted former Chief Justice KG Balakrishnan’s claim that he was
unaware of the name of the minister who tried to influence a Madras High Court judge regarding A Raja case.
Justice Gokhale said that in his letter to then Chief Justice of India Balakrishnan Justice Reghupathi clearly
mentioned the minister was A Raja. Justice Gokhale, now a judge of the Supreme Court, contradicted
Balakrishnan’s claim: “I may point out that Justice Reghupathi’s letter was already with him and in the second
paragraph thereof Justice Reghupathi had specifically mentioned the name of Raja. Justice Gokhale’s statement is
certain to raise questions about the functioning the higher judiciary during Balakrishnan’s tenure.

b) The Supreme Court stuck to its "something is rotten in Allahabad high court” rebuke to the country's largest
HC, stressing that the judges there passed "shocking orders" and behaved "in a totally unacceptable manner". What
has caused great pain and anguish to us are certain unfortunate happenings for some time in the Allahabad HC. It is
not necessary to mention all of them here, but reference can certainly be made to certain distressing orders passed
during summer vacations by certain judges of the HC this year.

c) In a rare move, the Supreme Court this week reprimanded Singh for failing to probe ex-telecoms minister
Andimuthu Raja over allegations he had sold licences too cheaply. The court demanded Singh himself explain what
had happened, tarnishing his squeaky-clean image. The document said the prime minister had done "all that was
required in the interest of probity".

12. Parliamentary Corruption

a) As per the Joint Parliamentary Committee (JPC) recommendations the Indian Government recently accepted
the demand of the MPs for a hike in their salary. It increased their salary from Rs 16,000/- to Rs 60,000/-, a hike of
400 %, apart from other allowances. As per the TOI report the pay of Indian MPs cost more to the country than
their counterparts in Singapore, Japan and Italy — nations globally known for their highly paid politicians. The
average pay packet including , accommodation, travel, medical facilities and water charges works out to be worth
more than Rs 44 lakh annually. There's another way of looking at the pay packets of our MPs — by comparing it
with the people they claim to represent. India's per capita GDP being $ 3,176 (PPP), it works out that after the hikes
our MPs will cost the country 68 times more than what an average Indian earns annually. That makes the disparity in
India between the citizen's average income and an MP's cost to country, among the highest in the world. Kenya is an
example of an even higher disparity, with its MPs earning 180 times the average population. The ratio is 35 for the
US while for most of western Europe and Japan, the cost of an MP doesn't exceed 10 times the country's per capita

b) The very same people who are egoistic to the core, time and again prevented the passing of women’s
reservation bill in the parliament. The same government now vehemently opposing the demand of JPC to probe
spectrum allotment.

c) It may be recalled that when the pension scheme for Members of Parliament was proposed in the days of
Morarji Desai, when he was the Prime Minister of India, he simply rejected the idea saying that in India only rich
people alone could think of becoming a member of parliament .As such there was no justification for granting
pension to a Member of Parliament

13. Removal of Corruption

a) Two national level political parties at the centre and removal of Third Front and other unholy alliances
resulting in the birth of NDA, UPA etc.

b) While graduation may a minimum requirement of the post of a peon/clerk, no such qualification is prescribed
for the MPS. Uneducated persons therefore take lead in governance.

c) While bringing a No Confidence Motion, the opposition must show that they have strength to obtain
confidence of the house. No Confidence Motion must not be utilized to unsettle a government. One may perhaps
remember the fall of Atal Bihari Vajpai government by 1 vote and thereafter no group was able to form government.

d) Hard punishment for corrupt and reward for the honest.

e) Discretionary power must be regulated properly so as to stop its misuse.

f) Ensuring people’s awareness about their rights.

g) Full use of the Right to Information Act.

h) Leveraging Information Technology in decision making - E Gov

i) Disseminating information through websites

j) Powerful, independent and non-corrupt media.

k) Anything to do with ordinary citizens should be made simple.

l) Improvement in government transparency.

m) Promoting investigative reporting in the local media.

n) Strong civil service, and fast pace of reform.

o) Control of Tax havens which tax their own citizens and companies but not those from other nations and refuse
to disclose information necessary for foreign taxation. This enables large scale political corruption in the foreign

p) Less interaction with officials with full use of internet services.

q) Many more such other means.

14. Some Interesting Facts about corruption in India

a) Now a days, an officer in India is considered "honest" if he takes the bribe and does the job. Conversely, a
"dishonest" officer is one who takes the bribe and still doesn't deliver!

b) Corruption flourishes because "it is a low-risk, high-profit activity".

c) Today the popular phrase is ‘thick as thieves’ not ‘thick as honest people’.

d) The uncorrupt are odd links in India today, people laugh at them.

e) POLICE ranks second in corruption below the politician. In the present circumstances the word POLICE may
be interpreted as:

Partners Of Legally Identified Criminal Enterprise. No offence meant.

f) Words from Swiss Bank Directors:

Indians are poor but India is not a poor country. Rs. 280 lac crore of Indian money is deposited in Swiss banks
which can be used for “tax less “budget for 30 years. It can give 60 crore jobs to all Indians. 4 Lane roads from any
village to Delhi. Forever free power supply to more than 500 social projects. Every citizen can get monthly Rs.
2000/- for 60 years. No need of World Bank loan and IMF loan.

g) Once an underworld Don from south stated that it was very easy for a criminal to operate in India provided he
knows 3 things:

a. Whom to Bribe b. When to Bribe and c. How much to bribe

h) India is a ‘superpower’ in corruption.

15. Indian Typology of corruption- Redefined

a) Chai-Pani

b) Diwali Gift

c) Bribe

d) Scam

e) Loot

f) Mortgage- Yes if given their way, a bunch of immoral politicians may not hesitate in mortgaging the entire
nation for their personal gain. Going back to East India Company

16. Perturbed by annual CPI rankings, many prime ministers and presidents of corrupt countries approached God for help
in eliminating corruption. God’s response was that it might not happen in their lifetime. It was a shock to them and all of
them wept bitterly on God’s shoulder. Indian prime minister also sought God’s help and advice so that he could also
eliminate corruption from India. The response of God was "NOT IN MY LIFE TIME" and God commenced shedding tears
on his shoulders.

17. Some of the Major Scam/Loot in India

Nagarwala Sukhna 2G Spectrum Cash For

Scandal Land Scandal Scam Votes

Oil for Food Common Wealth Satyam Bofors Scam

Programme Games(CWG) Software

Scam Corruption Services Scam

Animal Fodder Telgi Stamp St Kitts Ketan Parek
Scam Papers Scam Stock Market Scam

K C Bhansali Harshad Mehta Adarsh Sugar Import Scam

Scam Stock Market
Society by
Military and

Medical The Great US 64 of HDW submarine
Council Scam
IPO scam UTI scam
of India(MCI)

WESTLAND Kuo oil deal Cement scam IRAQ oil scam

helicopter scam


18. Commonwealth Games: - Allegations of corruption over the international sporting event that took place in Delhi in
October are being investigated by several bodies including the anti-corruption watchdog, the state auditor, the CBI and a
special committee set up by Prime Minister Singh. The Congress-party led coalition government came under fierce criticism
for mismanagement and ineptitude over the sporting extravaganza which cost up to $6 billion. Allegations of corruption
spanned a broad spectrum including issuing of contracts and purchase of equipment -- from treadmills to toilet rolls.

If you have a mania for fitness and want nothing less than the very best treadmill, Harrods of London can sell you the
exercise machine for £10,000, or about Rs 7 lakh. Now, how much do you think Commonwealth Games organising panel
should pay to rent — rent, mind you, not buy — a treadmill for 45 days? If you discovered that they are paying Rs 9,75,000
in taxpayer money just to hire a treadmill for a month and a half, would you not be exercised by it?

If you are, you may want to rest a little and recover your poise. How about on a chair being hired by Mr Kalmadi and his
cohorts at Rs 8,378 apiece? Or how about cooling yourself off with a drink from a 100-litre refrigerator which the Congress
politician and his colleagues are hiring for Rs 42,202 each?

19. Loan Bribery Case: - The Central Bureau of Investigation (CBI) arrested eight people, accusing them of bribery for
corporate loans. While the size of the scandal is not yet known, local media have reported it could run into hundreds of
millions of dollars. The bribes were allegedly paid by private finance firm Money Matters Financial Services , which acted as
a "mediator and facilitator" for the loan beneficiaries, the CBI said.

20. Aadrash Housing Society Case: -Local media say apartments with a value of $1.8 million were sold for as little as
$130,000 each in the apartment block, which faces the Arabian Sea in one of the world's most expensive stretches of real
estate in Mumbai

21. Satyam Computer Case :- The founder of Satyam Computer Services , one of India's top software firms, resigned in
January 2009 after admitting profits were falsely inflated for years. The fraud, estimated at $1 billion, was India's largest
corporate scandal and was dubbed "India's Enron". With clients abandoning it, shares were hammered down to near-penny-
stock levels.

22. Warning: - The spread of extremist violence (mainly naxals), increasing tendency of common people to take laws into
their own hands are some of the examples we will face in near future with higher intensity and with bigger impact on
everyone in the country. If we don’t take Gandhiji's civil disobedience approach to make this happen, then there is a high
possibility that our children will take the "guns and bullets" approach to stop repeat of East India Company.

23. Note of dissent: How many of us can actually claim with all honesty that we have never given a bribe? To be honest, I
cannot make this claim myself. So I too am corrupt even if I only paid in order to protect the interests of clients. I simply
make a promise not to repeat it off and on. But don’t know how long I will be able to keep it.

Compiled By:
CA Lalit Munoyat
B.Com. (Hons.), CS, FCA, DISA