Business, Economics and Jobs

Does India's Corruption Matter?

Widespread corruption in India costs billions of dollars and threatens to derail the country's growth, according to a new survey conducted by KPMG. But as far as voters are concerned, graft doesn't matter as long as the gravy train of sops continues to run.

The BBC reports that a survey of 100 top domestic and foreign businesses by the consultancy firm KMPG revealed they thought that corruption "had become so endemic that foreign investors were being deterred from the country."

"Today India is faced with a different kind of challenge," the BBC quoted the report as saying. "It is not about petty bribes (bakshish) any more, but scams to the tune of thousands of crores (billions of rupees) that highlight a political/industry nexus which, if not checked, could have a far reaching impact."

Like most industry reports about corruption, however, the authors appear to be ignorant of the fact that it takes two to make the bribe go right. And even if corruption may scare off global investors, the current system of "rules" appears to suit Indian business just fine if you look at the wealth amassed over the past decade or so.

Meanwhile, voters don't appear to care either, writes Tehelka. Even in Tamil Nadu, the state with arguably the biggest stake in India's largest corruption scandal to date, the so-called 2G spectrum scam, voters aren't the least bit worried about the alleged corrupt deals made by former telecom minister A. Raja -- a leading politician in the DMK. Why? Because the DMK was doling out goodies hand over fist.

Here's the magazine:

Jagannathan is a daily-wager who now drives an autorickshaw in Chennai. He hears what the streets say. “Sir, (DMK leader) Karunanidhi has given me everything,” Jagannathan begins. “In 2007, I got an auto (rickshaw) permit. In 2008, I got a free gas connection and the next year I was told the government would pay Rs 1 lakh ($2000) of any costs I would incur if I were to be hospitalised. Why should I care if Karunanidhi’s family earns crores (1 crore = $200,000)?”

This is how thousands feel in Tamil Nadu, a state seemingly populated by people who think they owe much to the ruling Dravida Munnetra Kazhagam (DMK). In 1976, Muthuvel Karunanidhi, the current chief minister, was described as a master of scientific corruption by the Sarkaria Commission when Indira Gandhi sacked the DMK government on grounds of corruption and imposed President’s Rule.

By 2009, Tamil Nadu had evolved into a ‘Thirumangalam Model’. Many remember a by-election that year. Silva, an avid blogger from Thirumangalam, recounts what happened. “My four-member family got Rs 16,000 in that election. The AIADMK gave Rs 1,000 each to my four family members; the DMK gave another Rs 12,000. Then, DMK leaders would offer chicken biryani every evening and gold coins to old women. Almost every night after 10 pm, we used to line up for free alcohol behind the TASMAC shop.”