Usher in good ethics in public life of our India

August

2015

Remember our CONSTITUTION?

"WE, THE PEOPLE OF INDIA, having solemnly resolved to constitute

India into a SOVEREIGN

DEMOCRATIC REPUBLIC, and to secure to all its

citizens :

JUSTICE, social, economic and political;

LIBERTY of thought, expression, belief, faith and worship;

EQUALITY of status and of opportunity; and to promote among them

all;

FRATERNITY assuring the dignity of the individual and the unity of

the Nation:

IN OUR CONSTITUENT ASSEMBLY

this twenty-sixth day of November, 1949,

do HEREBY ADOPT, ENACT AND

GIVE TO OURSELVES THIS CONSTITUTION.―

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In the Republic of India there is a widely shared desire in the country to

consolidate the gains made now as also to assess our future.

• Undoubtedly, the people of the country and the

managers of society can be congratulated on many

counts for India's achievements,

• (i) self-sufficiency (in fact surplus generation) in

food-grains,

• (ii) a strong industrial base,

• (iii) a rising expectancy of life,

• (iv) a higher percentage of literacy,

• (v) a united and better integrated India and

• (vi) a growing recognition by the world of our

capabilities and potential.

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On the negative side, one can‘t ignore the

nagging problems of

• unemployment, illiteracy and poverty,

• accentuated by an ever increasing population.

Also, a low per capita income, inadequate

infrastructure, feudalistic tendencies and worst of

all a pathetic contempt of rule of law and ethics in

public life.

Finally, an administration which is perceived as

self seeking and citizen unfriendly.

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• The Transparency International (TI) Corruption

Perception Index (CPI), ranks countries in terms of

the degree to which corruption is perceived to exist

among public officials and politicians. It is a

composite index derived from 15 different polls and

surveys from 9 independent institutions carried out

among business people and country analysts.

• CPI defines corruption as the abuse of public office

for private gains. The index provides an annual snap

shot of the views of business people and analysts

like bribing of public officials, kickbacks in public

procurement or embezzlement of public funds.

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• Of the 102 countries surveyed in 2002, seventy countries

– including many of the world‘s most poverty stricken –

score less than five out of a clean score of ten.

• Corruption is perceived to be rampant in Indonesia,

Kenya, Angola, Nigeria, and Bangladesh, countries with a

score of less than two.

• Countries with a score of higher than 9, with very low

levels of perceived corruption, are rich countries, namely,

Finland, Denmark, New Zealand, Singapore, and

Sweden. 6

• There is nothing to be proud of India's ranking in the

Transparency International's Corruption Perception Index

2009.

• The country ranked low also in the Bribe Payers Index

among emerging economic giants.

• The use of public funds for private gain is common.

• The misuse of power, position and privilege is widespread.

• Corruption seems to be a fact that affects all sections of

society

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TYPOLOGY OF CORRUPTION

Corruption is defined as the use of public office for private gains

Scales of corruption can be Grand, Middling or Petty and payment of bribes can be due to collusion between the bribe taker and the bribe giver, due to coercion or even anticipatory. Easy solution to personal issue.

Existence of corruption implies that there are corrupt people, there are also corrupt practices, and there is a corrupt system.

Therefore, all the three have to be fought simultaneously to eliminate the vice of corruption.

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Corruption in public life in India-2015

As a recent editorial in a leading newspaper

observed: Corruption in public life is one of the

most daunting issues facing the country.

Edmund Burke: All that is necessary for the forces

of evil to triumph in the world is for enough good

men to do nothing.

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Mahatma Gandhi:

(60 years ago)

Corruption will be out one

day, however much one

may try to conceal it.

The public can, as its right

and duty, in very case of

justifiable suspicion, call

its servants to strict

account, dismiss them,

sue them in a

law court or appoint an

arbitrator or inspector

to scrutinize their

conduct, as it likes.

(It doesn‘t care)

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Are you aware corruption accentuates poverty,

aggravates economic disparity, thwarts development,

undermines democracy and is a threat to national

security and, destroys the moral fibre of the Nation?

No, corruption will NOT destroy India. Why Not?

Because, much of India functions, 'oiled' by

corruption. It damages India, for sure. But just as the

average Indian has more of a 'natural immunity' to

TB, Asthma, Dengue, Malaria, Conjunctivitis, 'Delhi-

Belly' and other 'gastro viruses and bacteria', than

other peoples, Indians have found ways of

continuing to work around this corrupt system.

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Eight frequently asked questions about public

corruption:

(1)What is corruption?

(2) Which countries are the most corrupt?

(3) What are the common characteristics of countries with

high corruption?

(4) What is the magnitude of corruption?

(5) Do higher wages for bureaucrats reduce corruption?

(6) Can competition reduce corruption?

(7) Why have there been so few (recent) successful attempts

to fight corruption?

(8) Does corruption adversely affect growth?

PEOPLES’ PERSPECTIVE Indians think ( some even hope) that corruption cannot be eliminated in India – at least not in their lifetime. This pessimistic and cynical perception of the people is largely an outcome of confusing corruption with all kinds of illegal actions and activities by individuals.

Corruption is a threat to democracy and economic

development in many societies. It arises in the ways

people pursue, use and exchange wealth and

power, and in the strength or weakness of the state,

political and social institutions that sustain and restrain

those processes.

Most illegal actions, many of which are private actions, are

confused with corruption.

The Prevention of Corruption Act 1988 and Indian Penal

Code clearly distinguishes between corruption indulged by

public servants for private gains and illegal actions by

individuals.

There are separate Acts in India for dealing with different

kinds of illegal actions of private individuals. For example, if

a public servant amasses wealth disproportionate to his

known sources of income then he can be tried under

Prevention of Corruption Act 1988.

However, if a business-person amasses wealth

disproportionate to his known source of income he will be

dealt under Income Tax Act for concealing his income and

not under Prevention of Corruption Act. 14

Recent happenings in India

Corruption has been defined by the World Bank as the ‗use of public

office for private profit.‘ In our country, there are five major players on

the corruption scene, interdependent, strengthening and supportive

of the vicious cycle. They are the neta, the corrupt politician; the

babu, the corrupt bureaucrat; the lala, the corrupting businessman;

the jhola, the corrupt NGO; and the dada, the criminal of the

underworld !

The Prevention of Corruption Act 1988 and Indian

Penal Code _ clearly distinguishes between

corruption indulged by public servants for private

gains and illegal actions by individuals.

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September 2000: Former President Rao was convicted of criminal

conspiracy and corruption in the 1993 vote buying scandal and

became the first Indian Prime Minister to be convicted in a criminal

case. He was acquitted on appeal, however, in March 2002.

March 2001: Following the release by an Indian news website of a

videotape showing 31 politicians, high level officials, bureaucrats and

army officials taking bribes, the Defence Minister and leaders of the

ruling BJP party were forced to resign. Four defence ministry officials

were also suspended.

September 2005: Railway Minister Laloo Prasad Yadav was charged

with misappropriating state funds in the long running ―fodder scam‖.

He and Bihar Chief Minister were charged with embezzling over US$

40 million in state funds intended for the purchase of animal fodder.

In total, 170 persons were charged in connection with this scandal.

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In January 2006: A reporter in Assam writing articles accusing local

forestry service officials of having links to timber smuggling was

murdered.

In March 2006: The BJP alleged corruption in a military contract to

buy six submarines from two French companies, claiming that the

government overpaid by approximately US$ 113 million and used

the excess to pay middle men that helped secure the deal.

In January 2009: Satyam Computer Services Ltd was barred by the

World Bank from bidding for contracts for eight years and top

officials were arrested after a major financial fraud over several

years was disclosed.

In 2010: Telecom Minister Andimuthu Raja allegedly rigged the sale

of 2G telecoms licenses for lower prices to the companies he

favored.

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In 2010: The chief minister of Maharashtra resigned over his alleged

role in a scam involving homes for war widows. He was ordered by the

ruling Congress party to tender his resignation to Maharashtra's

governor while the matter was investigated. Mr. Chavan's relatives,

army officers and bureaucrats are among those who allegedly

acquired apartments. He denies any wrongdoing in relation to the

Mumbai housing project.

In 2010: Suresh Kalmadi, the much-maligned organising committee

chief of Commonwealth Games in Delhi, also quit his post in the

Congress party.

An other housing loan scam involving state-owned institutions and a

private and listed Mumbai-headquartered company Money Matters

Financial Services Ltd has been exposed. This has once again put

independent directors under a cloud At least three of the four

independent directors in Money Matters, whose CMD and two senior

executives were arrested by the Central Bureau of Investigation (CBI),

are ex-bankers and chairpersons of financial institutions.

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In fact, R N Bhardwaj, non-executive independent

director on the board of Money Matters was the

chairman of LIC and LIC Housing Finance for more than a

year till May 2005. He has served in LIC since 1968 till

his retirement in 2005. Money Matters, the CBI has

alleged, bribed senior officials in LIC and LIC Housing

Finance while mediating and facilitating loans for

builders and corporates from these institutions. Among

those arrested include the chief executive of LIC Housing

Finance. The other two are the former chairman and

managing director of state-owned Allahabad Bank and a

former CEO and chairman of state-owned financial

institution IFCI Ltd.

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Given their understanding and clout in the financial

services sector, experts wondered if they took their role

of 'independent directors' seriously and asked the right

questions. The fourth non-executive independent

director in Money Matters is Sanjiv Kapoor, a chartered

accountant, who has audited the books of the state-

owned insurer LIC.

Who will investigate these allegations?

• Central Vigilance Commission (CVC)

• Central Bureau of Investigation (CBI)

• Comptroller and Auditor General

(C & AG)

• The present system provides for taking on the

corrupt persons through a legal mechanism,

which has not been found to be very effective.

• Many corrupt practices fall outside the

purview of existing laws and need to be

tackled by people themselves.

• The responsibility for dealing with corrupt

people, corrupt practices and corrupt systems

devolves equally on individuals, civil society

institutions, legislature, executive, and the

judiciary.

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CORRUPTION IN INDIA: A scenario-1

India is one of the most regulated economies of

the world with powers concentrated in few hands.

It is a poor country with scarce resources where

demand is always more than supply. The receivers

of the public services are largely poor, ignorant,

and illiterate.

There is also absence of transparency and

accountability of the public servants. There is no

system of rewards and punishments for the public

servants.

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CORRUPTION IN INDIA: A scenario-2

There was also no right to information. The license-permit-quota-inspector regime was pervasive in India since independence and continues under a different nomenclature even after liberalization and globalization of 1991.

In addition, there are 3000 central statutes and 10 times as many state statutes plus subsidiary and administrative laws (most of them archaic), with several exemption clauses and discretionary powers sans accountability. All these conditions were fertile breeding grounds of corruption

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Good Governance Agenda

The growth of civil society networks engaged in anti-corruption work has played a useful role.

The last decade has seen the rise of NGOs involved in a broad range of anti-corruption activity at the village, city, regional and national levels.

These organisations are active on many fronts and are increasingly networking and provide useful role models for anti-corruption campaigners throughout the country.

The rise of civil / judicial activism has been accompanied by demands for greater transparency in public life.

Electronic media with ‗Crime news‘ plays an active role now 24X7.

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Success OF INDIAN CEOs IN SOME OF THE

FAMOUS Multi-National COMPANIES / institutions

1.Indra Nooyi- Pepsico

2.Amarthya Sen - Economic laureate

3.Ajay Banka- City Bank

4.Arun Sarin - Vodafone

5.MS Banga -Unilever

6.C K Prahladh - University of Michigan

7.Raghuram Rajan - International Monetary Fund

8. Padmasree Warier- Motorola

9.Jagadessh Bhagawati - Colombia University

10.Vyonesh Joshal - Hewlet Packard

11. Deutsche bank(German Company) – Mr. Anshu Jain as CEO.

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1556 - 1605 A.D. An example

from history:

AKBAR, EMPEROR OF INDIA

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AKBAR, EMPEROR OF INDIA-1

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Akbar "the Great," who governed India for half a

century (1556-1605) and by a wise, gentle and just

reign brought about a season of prosperity. This man,

whose memory even to-day is revered by the Hindus,

was named Abul Fath Jelâleddin Muhammed. And

truly he justified the epithet, for great, fabulously

great, was Akbar as man, general, statesman and

ruler.

AKBAR, EMPEROR OF INDIA-2

Akbar succeeded in establishing order, peace, and prosperity in his regained and newly subjugated provinces. This he brought about by the introduction of a model administration, an excellent police, a regulated post service, and especially a just division of taxes.

Up to Akbar's time corruption had been a matter of course in the entire official service and enormous sums in the treasury were lost by peculation on the part of tax collectors.

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• AKBAR, EMPEROR OF INDIA - 3

• The corruption in the finance and customs department was

abolished by means of a complicated and punctilious

system of supervision (the bureaus of receipts and

expenditures were kept entirely separated from each other

in the treasury department).

• Akbar himself carefully examined the accounts handed in

each month from every district, just as he gave his personal

attention with tireless industry and painstaking care to every

detail in the widely ramified domain of the administration of

government.

• Moreover the Emperor was fortunate in having at the head

of the finance department a prudent, energetic, perfectly

honorable and incorruptible man, the Hindu Todar Mal, who

was not a vizier or minister of state, yet had assumed all the

functions of such an office. 29

C o r r u p t i o n f l o u r i s h e s i n o u r s y s t e m b e c a u s e o f f i v e

b a s i c r e a s o n s ( b e s i d e s t h e i g n o r a n c e o f t h e v i c t i m s ) .

T h e s e a r e : ( i ) s c a r c i t y o f g o o d s a n d s e r v i c e s ( u r g e n c y

i n a v a i l a b i l i t y ) ; ( i i ) r e d t a p e a n d c o m p l i c a t e d r u l e s a n d

p r o c e d u r e s ; ( i i i ) l a c k o f t r a n s p a r e n c y i n d e c i s i o n -

m a k i n g ; ( i v ) l e g a l c u s h i o n s o f s a f e t y f o r t h e c o r r u p t

u n d e r t h e ‘ h e a l t h y ’ p r i n c i p l e t h a t e v e r y o n e i s i n n o c e n t

t i l l p r o v e d g u i l t y ; a n d ( v ) t r i b a l i s m o r b i r a d a r i a m o n g

t h e c o r r u p t w h o p r o t e c t e a c h o t h e r. T h e p o p u l a r

p h r a s e i s ‘ t h i c k a s t h i e v e s ’ n o t ‘ t h i c k a s h o n e s t

p e o p l e ’ .

‗Satyameva Jayate‘ …. eventually

Citizen Charters has been introduced to improve the quality of public services

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N. Vittal spent a four-year term as Central Vigilance

Commissioner and he is aware of the challenge

which the forces of corruption in our country pose to

those who want to fight it.

India pays lip service to the principle of honesty.

Gandhiji told us: truth and non-violence were the

fundamental principles of existence. Vedic dictum is

, ‗Satyam vadha - dharmam charah‘. Our nation‘s

motto is ‗Satyameva Jayate‘ or ‗Truth will triumph‘.

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The role of the Chief Vigilance Office, may broadly

be divided into two parts. i.e. preventive and

punitive. The Chief Vigilance Officers have so far

been concentrating mainly on the punitive side,

i.e. dealing with actual vigilance has not received

adequate attention. The word vigilance” mainly

implies watchfulness. The role of Vigilance Officer

is predominantly preventive. While detection and

punishment of corruption and other malpractices

is certainly important, what is even more

important is the taking of preventive measures

which could reduce the number of vigilance cases

considerably.

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Corruption is a two-way street. For every bribe taker,

there is a bribe giver. While the debate on

corruption in our country has focused on the

demand side of corruption, i.e., on public servants

and politicians who demand bribes, there has been

a thundering silence on the supply side of

corruption, i.e., around the business community

which bribes the public servants and politicians. It is

therefore interesting to note the business

community‘s focus on the issue of ethics in

business. Recently the CII organised a session on

ethics and corporate integrity.

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Corruption is like malaria, handled by either

giving medicine to those affected or by

preventing the breeding of mosquitoes.

Many of our rules and procedures breed

corruption. Orders have therefore been

issued to check and simplify procedures.

One example is a ban on post-tender

negotiations in government purchases,

except with the lowest bidder. Such

negotiations are a flexible source of

corruption.

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Corruption flourishes in our system because of

five basic reasons. These are: (i) urgent need

for goods and services; (ii) impatience with

complicated rules and procedures; (iii) lack of

transparency in decision-making; (iv) legal

cushions of safety for the corrupt under the

‗healthy‘ principle that everyone is innocent till

proved guilty; and (v) tribalism or biradari

among the corrupt and lazy seeker of an

urgent service/benefit, who protect each

other. If we believe corruption can be

eliminated, it can be.

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Given the integration of global markets and the

increasing application of information technology,

billions of dollars can be transmitted from one

market to another at the click of a computer

mouse. When foreign financial institutions invest

in an emerging market, they want to be sure that

not only will the management functions be

performed effectively, but that decisions will also

be taken in a transparent manner and principles

of corporate ethics observed. When the chips are

down, integrity and corporate ethics do count in

global trade today.

Business frauds Preventive and Predictive Maintenance

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The level of security in the financial

institutions becomes especially important

because ultimately, as Oscar Wilde said, the

thief is the artist and the policeman only a

critic.

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Is eliminating corruption a myth or reality? If we

believe corruption can be eliminated, it can be; if not,

it will remain a reality.

When Vivekananda went to meet Ramakrishna Paramhansa,

he asked directly, ‗Does God exist? Do you believe in Him?‘

Ramakrishna Paramhansa supposedly replied, ‗Yes, not only

do I believe in Him, but I can also make you see Him?‘

Vivekananda has also described the experience where as

Ramakrishna touched him, he felt the presence of God.

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When it comes to business frauds, it is always

better to adopt preventive and predictive

maintenance principles rather than the breakdown

maintenance principle, which is like locking the

stable doors after the horse has bolted. A classic

example is the Harshad Mehta scam where

because of lack of computerisation in the Public

Debt Office of the Reserve Bank of India, a Rs

l8,000 crore scam was perpetrated. It was only

after the fraud was unearthed that the RBI

computerised the Public Debt Office.

Tata Group Chairman Ratan Tata

Tata did not enter the airline business because he wasn‘t comfortable with the notion of paying a bribe of 150 million rupees ($3.3 million) to an un-named government official.

―We went through three prime ministers, and each time there was a particular individual that thwarted our efforts to form another airline,‖ Tata said. He even quoted another industrialist that said, ―You people are very stupid. The minister wants Rs 15 crore. Why don‘t you just pay it? You want the airline.

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• Tata‘s revelation follows the resignation of

Telecom Minister Andimuthu Raja.

• The government released a report on

Tuesday that Raja had allegedly rigged

the sale of 2G telecoms licenses for lower

prices to the companies he favored.

• The cost to the Indian government in lost

revenue has been estimated at 1.76

trillion rupees ($39 billion).

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The need for training in computerisation and using information

technology for enhancing the level of security in the financial

institutions becomes especially important because ultimately,

as Oscar Wilde said, the thief is the artist and the policeman

only a critic.

What computerisation does is provide a means of processing

a vast amount of data, which inter alia also give an idea about

the modus operandi of fraudsters. Intelligent application of

these concepts can help in preventing corruption and fraud.

Ah! put in place effective punishment

One method of minimising frauds is to put in place effective punishment systems. Our legal systems are so dilatory that the guilty often escape and even if punishment is meted out, it takes a long time. Often, the fraudster has so many resources at his command that he can engage the best legal brains to buy his way to freedom.

Who should rework the punishment regimen and our legal system to ensure speedy punishment to the corrupt and the guilty?

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Democratization of information and

knowledge:

The truth is that governments and citizens are fully

aware of the corruption which pervades their country.

The problem is that the people are ‗powerless‘ to stop

corruption.

Information, knowledge and patience are critical for

realizing all the human aspirations, such as,

improvement in quality of life. In the knowledge

society, in which we live today, acquisition of

information and knowledge and its application have

intense and pervasive impact on productivity gains.

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The concept of Citizen Charters has been introduced to

improve the quality of public services. It ensures

accountability, transparency and quality of services

provided by various government / business organistions. It

enables citizens to avail of services with minimum hassle,

in reasonable time, and at a minimum cost. Effective

implementation of Citizens Charters will go a long way in

controlling corruption. The Government of India has

launched an ambitious programme for formulation and

implementation of Citizens Charters in all government

departments.

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There is need to re-examine our culture, which has

normalised corruption in its many different forms.

We in India need to acknowledge the need for

introspection on our acceptance of the abuse of

power. The ―Seven Nolan Principles of Public Life‖

— selflessness, integrity, objectivity, accountability,

openness, honesty and leadership by example —

should form the standards for holding public office.

There should be regular and independent reviews

of individual and organisational functioning. The

challenge is to inspire and change individuals and

to transcend and transform societal norms.

A pluralist society with high ethics

in public life: Awake to it, India Vice of corruption can be overcome

Jai Ho

Adopting this strategy, we can definitely see India becoming a less

corrupt, progressive and developed country in the next 10 to 15

years.

Om Shanti! Shanti! Shanti

A Prayer for Wisdom

(Let us come together. Let

us enjoy together. Let our

strengths come together.

Let us move from

darkness to light. Let us

avoid the poison of

misunderstanding and

hatred. That way lies

progress.)

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INDIA can become a Nation, which is best described in the

words of Rabindranath Tagore

"Where the mind is without fear and the head is held high;

Where knowledge is free;

Where the world has not been broken up into fragments by

narrow domestic walls;

Where words come out from the depth of truth;

Where tireless striving stretches its arms towards

perfection;

Where the clear stream of reason has not lost its way into

the dreary desert sand of dead habit;

Where the mind is led by thee into ever widening thought

and action- Into that heaven of freedom, Oh Citizens, let our

country awake."

Source: Gitanjali, verse XXXV.

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"We are responsible for what

we are, and whatever we wish

ourselves to be, we have the

power to make ourselves. If

what we are now has been the

result of our own past actions,

it certainly follows that

whatever we wish to be in

future can be produced by our

present actions; so we have to

know how to act. "

-- Swami Vivekananda

Right to information act

The Right to Information Act (2005) and equivalent acts in the states, that require government officials to furnish information requested by citizens or face punitive action, computerisation of services and various central and state government acts that established vigilance commissions have considerably reduced corruption or at least have opened up avenues to redress grievances. The 2006 report by Transparency International puts India at the 70th place and states that significant improvements were made by India in reducing corruption

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Ombudsman [LokAyukta]

The LokAyukta is an anti-government corruption organization in the Indian

states. These institutions are based on the Ombudsman in Scandinavian

countries. An amendment to the Constitution has been proposed to implement

the Lokayukta uniformly across Indian States as a three-member body, headed

by a retired Supreme Court judge or high court chief justice, and comprise of the

state vigilance commissioner and a jurist or an eminent administrator as other

members .

Computerization

Bhoomi is a project jointly funded by the Government of India and the

Government of Karnataka to digitize the paper land records and create a

software mechanism to control changes to the land registry in Karnataka. The

project was designed to eliminate the long-standing problem of inefficiency and

corruption.

Introduction of smart cards for vehicle registration and drivers licenses by

Karnataka Regional Transport Organization.

Enforcement automation of traffic violations by Bangalore Traffic Police .

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• There is saving grace that the world view of an average

Indian is averse of vices. The broad masses of the people

has simple task to ask for transparency, accept the

verdict as the rule of the game what they otherwise do in

the name of their fate, burn the real life demon what they

do with the mythological ones.

• Get to zero tolerance for the perpetrators beyond all

bounds of personal links and likes. Operational side of

the campaign calls for making the institutions of

democracy efficient. It will handle much of the nexus of

political, bureaucratic and criminals.

• Jai-Ho