INDIA:A GROUP OF leading Indian corporate bankers and businessmen has written an open letter to prime minister Manmohan Singh's government urging it to fight corruption, impose judicial, police, electoral and land reforms, and improve poor governance to restore credibility and help the flailing economy to grow.
The group, which also includes judges, civil servants and a former central bank governor, warned in its letter that the government must combat the “strong nexus between certain corporates, bureaucrats and power-brokers”, all of which posed the “greatest threat to the Indian economy. We feel there is no movement in the key reform areas,” states the October 10th letter, the second after one, along similar lines, written in January. “We are talking of corruption that is making life unbearable for the common man and concerns everybody including us,” it adds.
And while the group welcomed the proposed appointment of an anti- corruption ombudsman that had been pending for 42 years after acrimonious negotiations with civil society activists, it noted that much more needs to be done.
The letter writers also lament the inefficiency of India’s judicial system with its backlog of more than 31 million cases, stating that even the most outstanding anti-corruption legislation would be useless if this crucial sector was not swiftly and adequately reformed and rendered more accountable.
The earlier open letter in mid-January had flagged similar problems, highlighting endemic corruption and recommending comparable reforms so that “positive transformation can begin to be achieved”.
Several Indian and international companies, including steelmakers Posco and ArcelorMittal, have had their massive projects stalled locally because of delays and backtracking in the approval process, triggering loss of all-round investor confidence.
Celebrated until recently as India’s most upright and trustworthy prime minister, Manmohan Singh (79) is presiding over the most venal and ineffective administration since independence in 1947.
After his Congress Party-led coalition’s re-election in 2009, the soft spoken and self-effacing Singh has also come to be seen as India’s weakest and least visible prime minister. Above all, he has shown himself as one incapable of containing unending multi-billion dollar scams during his tenure.
Alongside last year’s Commonwealth Games and the follow-on $39 billion telecommunication swindles – for which some of Singh’s cabinet colleagues, MPs and senior civil servants are in jail facing prosecution – the federal government is reeling under a wave of new financial scams.
These emerge almost weekly, involving the award of questionable oil, gas and coal prospecting contracts and the sale of prohibitively expensive government land to favoured parties at throwaway prices.
And though Singh’s personal integrity so far remains unblemished, confidence in his administration’s ability to investigate and prosecute these crimes, remains non-existent and has been taken over by the more credible supreme court.
Under Singh, India slipped three places in 2010 to 87th spot in Transparency International’s latest Corruption Perception Index, with financial scandals contributing to this low rating in a survey covering 178 countries.
With an “integrity” score of 3.3 out of 10, India was some way behind neighbouring China – ranked 78th on the corruption index card.
“It’s a scary scenario that could turn the land of the Mahatma (Gandhi) into one gigantic Gotham City with a flyover to hell,” former MP Pritish Nandy said when he demanded the Singh government’s resignation recently.
“They are destroying institutions, subverting laws and trying to build a dazzling, amoral edifice of crime and corruption unprecedented in the nation’s history,” he added.
On the previously robust economic front, with consistent annual growth rates of 8 to 9 per cent for many successive years, the situation is rapidly worsening. In early August, the prime minister’s economic advisory council conceded that business sentiment and investment in India had been adversely hit by scams and corruption.
The council is headed by Singh’s economic adviser C Rangarajan, who was part of the team that ushered in India’s market reforms in the early 1990s. Presenting the economic outlook for 2011-12, the council declared that corruption had paralysed the administration and was “badly hurting” investment.
Besides corruption, the council declared there was a “loss of focus on essential policy and reform initiatives” to sustain the high rate of asset creation and economic growth despite having navigated the global financial meltdown relatively unscathed two years ago.
It ruefully concluded that the spectre of corruption needs to dissipate before government decision-making can be revived. Galloping inflation and spiralling food prices added to the overall economic gloom.
An indicator of the loss of confidence in Singh’s government is provided by leading Indian businessmen such as Ratan Tata, owner of Jaguar-Land Rover, and Mukesh Ambani, head of Indian conglomerate Reliance.
Tata is the world’s fourth richest man on Forbes’s list of the world’s billionaires and has joined other leading business leaders in choosing to invest overseas in oil, telecommunication, information technology, engineering and manufacturing, rather than at home.
Unanimously, the businessmen felt that although less profitable, overseas investments, particularly in the West, were less “burdensome” and “hassle-free”; in short, corruption-free.
Tata invested $4 billion in various businesses abroad in 2009-10 compared to $200 million locally, while Ambani – who ranks ninthin the Forbes richlist – placed $5 billion in Africa and the US and half that amount in India during the same period. Similarly, India’s largest mobile operator Bharti Airtel invested $16 billion abroad and $2 billion at home.
Smaller businessmen, industrialists, bankers, traders and financial speculators said unabashed corruption at all levels, right down to on-site inspectors, had made the cost of doing business in India prohibitive. In a severe indictment of Singh’s administration, many said they had expended more in bribes over the past two years than in the previous 40.
