Table 1: TI Corruption Perception Index 2015

Rank	CP12015	Country	Region	WB code	World Bank CPIA	World Economic Forum EOS	Bertelsmann Foundation TI	African Dev Bank	IMD World Competitiveness Yearbook	Bertelsmann Foundation SGI	World Justice Project ROL	PRS International Country Risk Guide
1	91	Denmark	WE/EU	DNK		89			96	97	88	98
2	90	Finland	WE/EU	FIN		93			91	89	88	98
3	89	Sweden	WE/EU	SWE		89			87	89	88	98
4	88	New Zealand	AP	NZL		92			93	81	83	98
5	87	Netherlands	WE/EU	NLD		84			85	97	85	89
5	87	Norway	WE/EU	NOR		92			84	73	90	98
7	86	Switzerland	WE/EU	CHE		87			88	89		89
8	85	Singapore	AP	SGP		92	75		87		90	79
9	83	Canada	AME	CAN		79			79	81	79	89
10	81	Germany	WE/EU	DEU		72			83	81	80	89
10	81	Luxembourg	WE/EU	LUX		89			85	57		89
10	81	UK	WE/EU	GBR		82			81	73	80	89
13	79	Australia	AP	AUS		81			82	81	81	79
13	79	Iceland	WE/EU	ISL		87			83	65		89
15	77	Belgium	WE/EU	BEL		79			77	81	76	79
16	76	Austria	WE/EU	AUT		77			70	81	81	79
16	76	USA	AME	USA		69			74	89	74	79
18	75	Hong Kong	AP	HKG		87			80		78	69
18	75	Ireland	WE/EU	IRL		89			83	73		79
76	38	Bosnia and Herzegovina	ECA	BIH		32	40				34
76	38	Brazil	AME	BRA		25	62		25		34	31
76	38	Burkina Faso	SSA	BFA	47	29	32	45			28	41
76	38	India	AP	IND		54	45		35		25	41
76	38	Thailand	AP	THA		43	40		38		26	31
76	38	Tunisia	MENA	TUN		42	28				38	41

Table 2: Bribery Perception Index (BPI) 2011

Rank	Country/Territory	Score	Number of Observations	Standard Deviation	90% Confidence Interval
Rank	Country/Territory	Score	Number of Observations	Standard Deviation	Lower Bound	Upper Bound
1	Netherlands	8.8	273	2	8.6	9
1	Switzerland	8.8	244	2.2	8.5	9
3	Belgium	8.7	221	2	8.5	9
4	Germany	8.6	576	2.2	8.5	8.8
4	Japan	8.6	319	2.4	8.4	8.9
6	Australia	8.5	168	2.2	8.2	8.8
6	Canada	8.5	209	2.3	8.2	8.8
8	Singapore	8.3	256	2.3	8.1	8.6

8	United Kingdom	8.3	414	2.5	8.1	8.5
10	United States	8.1	651	2.7	7.9	8.3
11	France	8	435	2.6	7.8	8.2
11	Spain	8	326	2.6	7.7	8.2
13	South Korea	7.9	152	2.8	7.5	8.2
14	Brazil	7.7	163	3	7.3	8.1
15	Hong Kong	7.6	208	2.9	7.3	7.9
15	Italy	7.6	397	2.8	7.4	7.8
15	Malaysia	7.6	148	2.9	7.2	8
15	South Africa	7.6	191	2.8	7.2	7.9
19	Taiwan	7.5	193	3	7.2	7.9
19	India	7.5	168	3	7.1	7.9
19	Turkey	7.5	139	2.7	7.2	7.9
22	Saudi Arabia	7.4	138	3	7	7.8
23	Argentina	7.3	115	3	6.8	7.7
23	UAE	7.3	156	2.9	6.9	7.7
25	Indonesia	7.1	153	3.4	6.6	7.5
26	Mexico	7	121	3.2	6.6	7.5
27	China	6.5	608	3.5	6.3	6.7
28	Russia	6.1	172	3.6	5.7	6.6
Average		7.8

Table 3: Bribery Perception by Sector 2011

Rank	Sector	Score	Number of Observations	Standard Deviation	90% Confidence Interval
Rank	Sector	Score	Number of Observations	Standard Deviation	Lower Bound	Upper Bound
1	Agriculture	7.1	270	2.6	6.8	7.4
1	Light Manufacturing	7.1	652	2.4	7	7.3
3	Civilian Aerospace	7	89	2.7	6.6	7.5
3	Information Technology	7	677	2.5	6.8	7.1
5	Banking and Finance	6.9	1409	2.7	6.8	7
5	Forestry	6.9	91	2.4	6.5	7.3
7	Consumer Services	6.8	860	2.5	6.7	6.9
8	Telecommunications	6.7	529	2.6	6.5	6.9
8	Transportation and Storage	6.7	717	2.6	6.5	6.9
10	Arms, Defense and Military	6.6	102	2.9	6.1	7.1
10	Fisheries	6.6	82	3	6	7.1
12	Heavy Manufacturing	6.5	647	2.6	6.4	6.7
13	Pharmaceutical and Healthcare	6.4	391	2.7	6.2	6.6
13	Power Generation and Transmission	6.4	303	2.8	6.1	6.6
15	Mining	6.3	154	2.7	5.9	6.6
16	Oil and Gas	6.2	328	2.8	6	6.5
17	Real Estate, Property, Legal and Business Services	6.1	674	2.8	5.9	6.3
17	Utilities	6.1	400	2.9	5.9	6.3
19	Public Works Contracts and Construction	5.3	576	2.7	5.1	5.5
Average		6.6

Quoting Indian media Vidyadevi Patil (2015) in her book had statedthat there have been widespread allegations of corrupt Indian citizens stashing Billions of dollars in Swiss banks. While Swiss authorities initially brushed aside these allegations only to later release the names of more than 2600 holders of accounts that have remained dormant for at least 60 years. Ironically the Indian media is mainly owned by corrupt politicians and industrialists who also play a major role in most of these scams, thus misleading public with wrong information and using media for mudslinging against their political and business opponents. Besides there are various causes of corruption in India includinglicensing requirements, complicated taxes, numerous government departments each with opaque bureaucracy and discretionary powers, monopoly by government controlled institutions on certain goods and services delivery, and the lack of transparent laws and processes. It was also observed that there are significant variations in corruption level as well as governmental efforts across different states to bring down the corruption rate across the country.

BRIBERY AND CORRUPTION IN INDIA:

Bribery and Corruption in India can be traced back to the country's colonial past under the British Raj. From the beginning of 1858, Indian citizens were excluded from political participation by dividing the country into districts with provincial governments controlled by a commissioner. After gaining independence in 1947 from British Raj, the new regime implemented heavy economic regulations intended to build domestic markets. This period up to 1991 was dubbed the "License Raj" as a result of the government's excessive oversight of the economy. But with this effort the poor often suffered most from the widespread corruption, which diverted large amounts of Government exchequerfunds intended for public works, aid, and social welfare programs.

The first major law to combat government malfeasance was the Prevention of Corruption Act (PCA) of 1947, enacted to prevent officials from cashing in on post-war reconstruction funding. Additionally, in 1961 the parliament also passed legislation to establish the Anticorruption Bureau to investigate violations of the PCA, which has since been amended twice (most recently in 1988). The latest revision was a direct response to the late-1980s Bofors scandal. A 2011 report from Klynveld Peat Marwick Goerdeler (KPMG) stated that 68 percent of India's total illicit capital loss happened after the country's economic liberalization in 1991, indicating that the reform and rise of India's economy has contributed to the transfer of "black money" abroad.

SPIRALLING PROBLEM:

Many recent high-profile scandals have underscored the extent of the problem. In 2010, there were allegations around the gross misallocation of funds at the Commonwealth Games, which cost almost eighteen times its estimated budget. Reports in media also surfaced on shoddy infrastructure and financial irregularities regarding contracts, and the scandal led to the resignation of two senior ruling Congress Party members and other government officials. The Central Vigilance Commission (2010) cited the total misappropriation of funds to be around $1.8 billion. Soon after, controversy mired the government again when an Auditor General’s report (2010) uncovered a massive telecom scam estimated to have cost the government some $39 billion, making it the largest case of state corruption in the Indian history. Again in 2012 “Coalgate" scandal, in which an estimated $34 billion was lost in coal mining allocation, implicated the prime minister himself.

Country's image among international investors is also tarnished due to mounting graft causing domestic worries. Due to which, since independence India has lost hundreds of billions of dollars in illegal capital flows (tax evasion, corruption, bribery, kickbacks, etc.), and was ranked 142 of 189 countries in the World Bank's 2015 Doing Business Report. While some experts believe there isn't necessarily a direct correlation between corruption levels and India's economic health but the recent graft cases haveonly demonstrated it’s been corrosive to India’s growth. Incidentally with the recent release of World Bank Group’s latest Doing Business 2018: Reforming to Create Jobs report, India for the first time moved up in the World Bank’s Ease of Doing Business global rankings to 100 (from 130). This is on the back of sustained business reforms over the past several years.

ANTI-CORRUPTION FRAMEWORK IN INDIA:

The recent Lokpal and Lokayuktas Act of 2013 which came into force in January-2014, seeks to provide for the establishment of the institution of Lokpal to inquire into allegations of corruption against certain public functionaries in India. Prior to this, the law relating to bribery was contained in:

· The Public Procurement Bill of 2012

· Whistle Blowers Protection Act of 2011, received the assent of the President of India in May 2014. It’s a mechanism to investigate alleged corruption and misuse of power by public servants and protect anyone who exposes alleged wrongdoing in government bodies, projects and offices.

· Prevention of Money Laundering Act of 2002 and Indian Penal Code of 1860

· The Prevention of Corruption Act, 1988 (formerly Prevention of Corruption Act PCA of 1947)

· The Benami Transactions (Prohibition) Act of 1988 to prohibit Benami transactions

· Prosecution section of Income Tax Act of 1961

It is often misconstrued that India’s principal anti-corruption legislation – the Prevention of Corruption Act, 1988 (PCA)- does not create an offence of bribery on the part of the bribe giver but merely attacks the demand side i.e., the bribe taker. This is an incorrect position as under the PCA, as the offence of bribe giving is created as one of abetment of bribe taking by the public servant. Thus, the punishment for bribe giving is attune to that which a public servant convicted of accepting bribes would receive, which is imprisonment for a minimum term of six months extending to five years and would also be liable to pay a fine.The PCA does not recognise facilitation payments or any exception to the gratification other than legal remuneration concept. The gratification which if not legal remuneration is deemed illegal whether given for a lawful or unlawful purpose. Hence any speed, grease or facilitation payments would be considered to be bribes under the PCA.

There exists no offence for private sector bribery as the PCA is focussed on the bribery of public servants. However, private sector initiatives to combat bribery and corruption include measures such as the model anticorruption contractual clause published by the International Chambers of Commerce (2012). The same organisation has produced a set of self-regulatory guidelines designed to influence corporate behaviour in this area. Transparency International has also issued a set of voluntary guidelines for companies to follow in the form of its Business Principles (Transparency International 2009).

Meanwhile the Governmenthas drafted a proposal for amendments in Indian Penal Code (IPC) for criminalizing acts of bribery in the private sector. For this, the ministry has circulated a draft amendment bill among states for their views. The proposed amendments will address all pending legislative changes required for India to fully ratify UN Convention Against Corruption (UNCAC). A proposal for introduction of a fresh bill for criminalization of foreign bribery is under active consideration of the government. While the government has addressed this issue partially by incorporating provisions on private entities to be held accused for bribing public servants, bringing corruption in private sector within the ambit of the IPC Act is the prime focus of the proposed amendment bill.

At present the bribery of foreign public official or officials of public international organisations is not an offence. However, the Law Commission in August 2015 brought out a draft bill of “Prevention of Bribery of Foreign Public Officials and Officials of Public International Organisations Bill” which makes accepting or giving bribe of foreign public officials, a predicate offence entailing a jail term of 6 months to seven years and liable to pay a fine.Similarly, the Prevention of Money Laundering Act, 2002 provides that the properties of corrupt public servants shall be confiscated. However, the Government is also considering incorporating provisions for confiscation or forfeiture of the property of corrupt public servant in the Prevention of Corruption Act, 1988 to make it more self-contained and comprehensive. As recently as last year, the Parliament passed the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Bill, 2015 to curb and impose penalty on black money hoarded abroad. The Act is pending for assent of the President of India.

Based on suggestions made the Law Minister, the law panel has recommended that the proposed law must provide a specific provision that details the defences and exceptions available against the offences under the law. On the flip side India has entered into Mutual Legal Assistance Treaties in Criminal Matters with 34 countries, is a member of the Interpol, and has Extradition Treaties with 37 countries and Extradition Arrangements with 8 countries. Hence with growing cooperation between investigative and prosecution authorities, it is to be noted that the legal framework in India is provisionally competent to offer assistance if the need so arises.

BRIBERY AND CORRUPTION OFFENCES UNDER PCA:

BY PUBLIC SERVANTS:

1. Accepting, obtaining, attempting to obtain, or agreeing to accept:

a) “gratification”, other than legal remuneration, as a motive or reward for inter alia doing or refraining from doing any official act or favouring or disfavouring any particular person;

b) any valuable thing without consideration or with inadequate consideration, from any person who is concerned in any proceeding or business transacted by the public servant;

2. Obtaining money or any other gratification as a reward for inducing a person erroneously to believe that the official’s influence with the Government has resulted in his obtaining a “title” (i.e. benefit) for the other person.

BY OTHERS:

1. Offering “gratification” to a public servant.

2. Accepting, obtaining, attempting to obtain, agreeing to accept “gratification” in order to exert personal influence over a public servant.

3. Influencing a public servant by corrupt or illegal means, into inter alia doing or forbearing to do any official act.

4. Abetting public servants in committing acts punishable under the PCA (as set out above).

REFORMS AND PROSPECTS FOR PROGRESS:

Successive Governments in India has made a few attempts at the federal level to combat corruption. The Right to Information (RTI) Act allows citizens to request access to any public record and, if approved, receive it within thirty days. The law, which can penalize noncompliance and requires authorities to digitize records, has been hailed as a pivotal achievement in the fight against corruption. The concerned ministry within the government is also considering moves to strengthen the national anti-graft law, potentially introducing changes that would punish corporate failure to prevent bribery. Judiciary has also taken a stronger stance against corruption; in early 2011, the Supreme Court asked all trial courts in the country to fast-track corruption cases. Again, in July-2013 the Supreme Court ruled (Lily Thomas v. Union of India case along with Lok Prahari v. Union of India case that it was illegal for politicians convicted of crimes to continue holding office. In October 2013, Rasheed Masood became the first constitutionally elected MP to lose his Minister of Parliament (MP) seat under the new guidelines due to corruption charges.

Information Technology also helped the Indian Government in fighting Bribery and Corruption to vast extent. Few progressive and economically sound states in India have already implemented online systems to transparently bid for state contracts; also put land registration records online. Few NGOs have setup their own sites to expose grafts associated with public offices.

At international level, the OECD’s Convention on Combating the Bribery of Public Officials in International Business Transactions sets out a framework that is intended to be adopted in all signatory countries to regulate and criminalise the practice of bribery in the course of business dealings with foreign governments. There is also the UN Convention against Corruption, which is wider in scope than the OECD convention in that its measures are directed at both private and public-sector business dealings. It identifies the need for all members of society to be involved in combating corruption, and calls on all countries to promote the involvement of civil society and to raise awareness of corruption and ways of tackling it.

Individual governments have also been taking action. The UK updated its long-standing laws on bribery in 2010 with a new Bribery Act. The revised law reforms the existing offences of bribing another person, accepting bribes and bribing foreign public officials. It also introduces a new ‘corporate’ offence of failing to prevent acts of bribery being perpetrated by employees, agents or subsidiaries. This corporate offence applies to any business incorporated in the UK and to any foreign firm that carries on business in the UK. Its scope encompasses bribery activities conducted anywhere in the world.

However, the longest-standing and arguably the most effectively enforced anticorruption statute is the US Foreign Corrupt Practices Act 1977 (FCPA). FCPA makes it unlawful for any American individual or business, and any foreign business that is listed in the US, to make a payment to a foreign official for the purposes of obtaining or retaining business. The FCPA imposes extensive accounting and internal control obligations on listed companies, intended to help ensure that they do not make payments that would fall foul of the act. The criminal penalties meted out by the US authorities both for actual bribery activities and for non-compliance with the control requirements can be substantial (for e.g., the highest recorded being the $800m fine imposed on the German company Siemens AG in 2008).

Besides supplementing the legal measures that are specifically aimed at bribery, the recommendations on combating money laundering issued by the intergovernmental Financial Action Task Force (FATF) require all countries should enact laws to criminalise the practice of dealing with the proceeds of bribery and corruption (FATF 2012). As part of this regime, banks, accountants, solicitors and other ‘regulated persons’ should be required by national law to communicate to the relevant authorities any suspicions they have that their clients (or any other people they encounter in their professional work) have committed any such offence. The result of this framework of controls is that businesses of all sizes should be aware that whenever they deal in the proceeds of crime (whether those proceeds relate to bribery and corruption or other crimes of equivalent magnitude) their actions are liable to be detected and reported.

CONCLUSION:

The last 5 years have seen various efforts being made to reform the Indian anti-corruption legal framework and various examples of these proposed legislations that have been introduced in the Indian Parliament have been touched upon above. The Indian legal framework most definitely has various gaps just like every other legal system does, but where India takes a beating is on the execution of its legislative intent and enforcement an action.

The inherently weak enforcement mechanism coupled with compromised political will – is reluctantly faced with reform in the face of a strong public sentiment against corruption and proactive media houses. The business of bribery has been hit as media reporting and public awareness has mandated that demonstrable action is taken, which has resulted in more matters being investigated and finally prosecuted. This notwithstanding, bribery is unfortunately treated as an opportunity cost in India and the number of corruption scandals and global watchdog reports would only go on to re-affirm this point.

According to Milan Vaishnav and Sandip Sukhtankar of Carnegie Endowment for International Peace, South Asia Think Tank Program, increasing the level of transparency about government performance produces the greatest returns when it is supplemented by reforms that enhance the bargaining power of ordinary citizens, improve coordination and collective action, or strengthen the State’s ability to punish impunity.

In general, it has also been widely perceived, more awareness and sensitization are needed across the board on ethical values and integrity and that a continuous dialogue across various sectors of society including the Government, private sector, civil society and the media is critical. Additionally, witness protection mechanisms as well as whistle-blower policies are important mechanisms to strengthen the investigation and prosecution of corrupt acts.

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Received on 13.03.2019 Modified on 10.04.2019

Res. J. Humanities and Social Sciences. 2019; 10(2):577-583.

DOI: 10.5958/2321-5828.2019.00094.9