In a different context, referring to the unseemly crossfire and allegations connected with various terror strikes at different times in the country, Pratap Bhanu Mehta, the noted thinker, has commented, 'now every mainstream political party openly questions the legitimacy of the state.' He goes on to conclude, 'it is not over-dramatic to say that we are nearing a precipice, and only something quite drastic can prevent our steep fall.' One cannot ask for reforms in stronger or more strident terms.
Returning to the main point, it cannot be a continuation of the same set of policies which will bring about the development and improvement of the poorest segments of our society. It has now been nearly universally acknowledged that the trickle-down theory has not worked and will not work. A policy mainly focusing on the urban/industrial sector to the neglect of rural agrarian India is bound to fail in the medium or long run. Indeed this has been proven in India. A critical parameter in India today is the ability to create new jobs on a large scale – this can only be done in the agriculture, animal husbandry and related rural sectors. Growth merely in industrial sector will not translate itself into national well being. Will growth continue to be our sole mantra? Is 'inclusive' growth another fraudulent phrase meant to mislead and deceive the countless millions who have the misfortune to be born in India. When will our rulers recognise that drastic changes in our economic policies are essential if the country is to survive the next fifty years?
Corruption – linkage with backwardness . . .
The direct linkage between backwardness, poverty on one hand, with corruption on the other, has not found general recognition in India. It is no coincidence that countries high in the corruption index are generally those which fall very low on the human development index – the correlation is too marked to be accidental. Surely, a country with forty percent of the population living in abject poverty and another forty percent quite poor, living with bare minimum standards can hardly be called a true democracy. A key reason for this is corruption. Economists and planners are generally preoccupied exclusively with economic growth. Many economists privately dismiss corruption as an issue, as it is merely a 'domestic transfer payment', with no impact on GDP. However, corruption has a huge impact on income transfer, and contributes to income disparity, backwardness and poverty. Its impact on equity and income distribution is most marked. While policy-makers and politicians in power frequently refer to 'programmes for the poor' in a patronising manner, addressing the corruption issue effectively will be the key to reducing income disparities. In fact, the 'rights' of the majority of the people have been trampled due to corruption.
A significant part of India's domestic transactions is funded by black money; various estimates have placed the numbers at a very high level. Indeed, the 'parallel economy' is surmised to be at least as large as the official economy. In the period following the international financial crisis of October 2008, one wag had mentioned that its impact on India will be quite limited because the Indian economy does not function merely on banking finance. It is also fuelled through black money, to keep it going! A Swiss Banking Association report of 2006, estimates bank deposits in the territory of Switzerland by Indian nationals, to be a staggering $1,500 billion. This is three times as large as the deposit from the next country, Russia. The Indian deposits are significantly higher than those from other countries including USA, Germany, Japan, Brazil, etc. There is no doubt that this represents the stashing of ill-gotten wealth of corrupt businessmen, politicians, bureaucrats and other Indian crooks. Naturally, these numbers don't represent Indian money hiding in other 'safe-havens', elsewhere in the world. Now that the international mood in respect of such stashing of funds has changed, is it too much to hope that the government will make a genuine effort to expose the wrong-doers, and get the ill-gotten money returned or will it just take proforma, make-believe steps as before?
In the past decade or so, many significant beginnings have been made in addressing the corruption issue – the Right to Information Act and bringing technology into administration are significant steps in the right direction. Industrial and financial sector reforms have also led to near-elimination of the quota-permit raj, which are welcome. Providing competition to the public sector agencies in the services field, like banks, civil aviation, etc., and introduction of technology, like in railway bookings has reduced the impact of corruption in many sectors. Significant new initiatives on e-governance have recently been undertaken which are also in the right direction. It should, however, be added that most of these initiatives have impacted only the affluent and middle classes in India and have not meant much for rural India and the urban poor.
Much of the citizens' contact with the government is at the district and sub-district level – the thana, the tehsil, the block, etc. The existing systems have no credibility left with public in these cutting-edge areas. The nexus between lower officials and local politicians is a reality of life. No citizen can expect any assistance from these agencies except with significant doses of speed money. Rajiv Gandhi had estimated that about fifteen percent of development funds reaches the citizen – the rest is siphoned off by the middle man. In Tamil Nadu, avowedly a well-run state, I was recently speaking to a field joint director of rural development – her estimate of the amount that reaches the beneficiary was about thirty percent. It is the same story nearly wherever you turn. Surely, the massive levels of unauthorised construction in our metropolitan cities could not have happened without the knowledge of local authorities and the local politicians and without the transfer of thousands of crores of 'blinker money'. One's own experience and all anecdotal assessments indicate a progressive increase in corruption levels in the past decades.
Most persons residing in urban areas, particularly of the professional class, may feel that references to corruption, in rural areas or in government circles, are highly exaggerated. The average middle class city dweller is generally not overly exposed to this phenomenon in a serious manner; perhaps he may come across a policeman, who has to be squared up in connection with a traffic violation – that may be the extent of his contact with the phenomenon. However, when he starts entering into a land transaction, or purchase of a flat, he would quickly come across the black money issue; in the registrar's office, almost invariably he will see what speed money can achieve – in fact failure to utilise this device can teach him a basic lesson. In general, one can stipulate that the average urban middle class citizen, the professional or the salaried employee does not come across this phenomenon in a serious way. However, a businessman, a tycoon, a person starting a university or a college or a hospital, any entrepreneur, indeed the small vendor or the small scale industrialist would know, on a daily basis, the full import of this phenomenon. Most in these categories do not talk about it. They are interested in getting their work done, and not in raising dust. Only those who need or want something – a licence, a permit, a loan, approval of building plans – these are the targets, who experience the reality. On the other end of the spectrum, the farmer or the landless labour or the small town trader lives through the experience on a daily basis. In fact, the self-employed is used on the one hand to bribe his way through the vicissitudes in daily life, and on the other fleece his customer or evade his taxes, which essentially also means that he is cheating the public. The rural poor are victims, they can't do anything about it – the upper crust or the businessman will be happy to pay anything that is required; he wants his work done.
I read a recent article by S. Ganesh, a professional from Mumbai, who purchased a plot of land in a village on the outskirts of Nasik, and planned to develop a small orchard along with a modest house, to spend his retirement days. He has graphically described the various steps he had to go through to get the documentation done and other formalities completed, which took three or four years, along with liberal doses of speed-money. His interesting conclusion – nothing has changed in India's rural areas since the Mughal times. The cell phone has arrived, the dhoti has been replaced
by the trousers and the odd motorbike can be seen – in every other respect, the village goes on as it did for the last five hundred years. Indeed, Transparency International and number of other similar agencies have, after a dispassionate comparison with all other countries in the world, reached the conclusion that India is one of the most corrupt countries in the world – none has seriously challenged this.
But who indeed is interested in stemming the growth of corruption. What are the forces working to not only keep corruption on leash, but to diminish its range and scope? Can the technological steps and policy moves alone reduce or mitigate corruption levels? Is any one actually doing anything about it seriously, apart from lip-service? If one were to think about these dispassionately, the picture is bleak indeed. Let us take a reality check.
Indeed the country, nominally a 'democracy' is ruled by five classes of people – the politicians, the bureaucrats, the judiciary, the business class and of late, the media. Let us examine the position of each one of these.
The politician surely can live with corruption – indeed he cannot live without it! Reference to this politician or the other having amassed Rs 1,500 crores or Rs 2,000 crores is now accepted without one eye-blink. It is well known that most transactions of the politicians are in cash in large amounts which is totally unaccounted for. The reality is that politics is now the biggest business in the country, with no accounts, or accountability and without any checks, balances or overlooking ombudsman.
The bureaucrats are at best disinterested. Whereas the field level functionary is steeped in corruption, though mostly on a petty case-to-case basis, the senior bureaucrat does not want to know about this. Most or many of them are probably financially honest, (though it is increasingly difficult to make this statement of late). But most of them definitely are intellectually dishonest. They will not get their hands soiled by grappling with corruption – this could ruin their career. They prefer to look the other way. I can relate many stories, based on my personal experience, of officers afraid to get involved. Indeed senior officers would not go to the extent of giving a doubtful or negative assessment of a known dishonest subordinate – this could prove dangerous. Do not count on bureaucrats to take sides on this issue – indeed, on any other!
The business community actively welcomes the opportunity of corrupting others. With greed they look for politicians and bureaucrats who are 'amenable', and there is no shortage of targets to stalk. So long as giving a 'bribe' is not seen as a crime in India, the businessman will look for short cuts at every turn. Indeed he has no choice; he will be left stranded in the current situation, if he doesn't play an active part as a bribe-giver.
The media has shown sporadic interest in the matter, particularly when large raids take place and the target is newsworthy. Their interest flags the moment the news-value wears off. There is no follow up on work done by intrepid journalists. Indeed a noteworthy performance by one television channel in unearthing a major scandal is frequently totally ignored by the rest of the media. The media lives for viewership/readership percentages alone. If any fight ever raged against corruption, we had better make it newsworthy, or the media would not be involved.
I would not say much about the judiciary, for obvious reasons. All I would say is that I have seen no sustained enthusiasm to combat corruption. After all, chief ministers and union ministers have had cases against them for over a decade and are happily in the public eye, controlling public affairs – we do not know if they are benefactors of the public or just plain crooks. Perhaps the theory is that the quality of evidence will improve with age! Surely, whatever may be the reality, the public has the right to expect a verdict in short order. More complicated cases abroad are settled much quicker, particularly where personalities with impact on public issues are involved. Procedure is king— substance may wait—and the beneficiary is the lawyer profession and the guilty; the loser is the citizen.
The truth is that nobody is fighting the battle against corruption. The structures have been created in such a manner that it is not in the interest of any group to join the cause. Are we still naive enough to think that a couple of administrative measures will have enough impact on corruption. No wonder people are apathetic; civil society apparently has no role.
While I may sound negative in all that I have said above, I genuinely believe that combating corruption is concretely feasible if appropriate steps are taken. In the British times, the district magistrates' and the SDMs' primary job was to supervise all activities of the subordinate staff. The focus was district administration – this was the key to sound administration. This focus has now blurred. Everyone seems to be busy in crisis management or in looking after VIPs. No official at the district level or the state level has any time for field work – field operations are totally left to very junior officials, local politicians and touts. Swift exemplary punishment for errant local officials is an important weapon. However, this has been blunted with too much interference and review at various levels, including generous judicial interventions. No district magistrate now will dare to dismiss any local employee and will hesitate even to suspend one. It is imperative to bring the focus back to district administration in all aspects – as this is where services are genuinely provided to the citizen.
I recall reading the memoirs of Colonel Sleeman, pertaining to the mid- nineteenth century British raj. When the 'thuggee' problem was discovered in north India, Sleeman was appointed as a one-man commissioner to eliminate the problem and was given a totally free hand for this task. It took ten years but the problem was eliminated. We need a couple of Colonel Sleemans today and more importantly a free hand to be given to him so that we can expect results. It may also be recalled that in the 1920s-30s in Chicago, the notorious gangster Al Capone was caught on a minor income-tax violation charge and sent to twelve years in prison within a month. This was the beginning of the break up of the mafia. In India, we have had a union minister caught with many crores of rupees in cash in his own house but had no need to explain how the money came there. There was no effective prosecution as the charges were pressed tardily. It took ten years for his conviction in a lower court and there are many legal steps still to be covered. The CVC, a constitutional authority, has been given the task to tackle corruption, at least in official circles. Sadly it functions like a watchdog that never barks. His pet-poodle-like quiet is as though there is hardly any official level corruption in India.
Exemplary swift punishment of prominent cases will change the scene in short order. If people are brought to book and in three-to-six months are given highly publicised effective prison sentences, the deterrent effect will be powerful indeed. In my humble experience, swift, strong, exemplary, high-visible punishment under the law is an effective deterrent. I could be wrong, but I have not seen a union minister or chief minister go to jail for ten years for corruption- related charges – probably none of them ever violated the law!
A major thrust on e-governance, meaningful administrative reforms, carefully focused judicial interventions with much greater use of 'commissioners', perceptive assistance by the media can all go to mitigate the problem to a large extent.
Basic Management Lessons – to be or not to be . . .
Efficiency, timeliness, initiative, innovation, dedication, integrity and resultorientedness, as any business school would say, are the essential features of good management. Ability to take calculated risks and to take the right chances, to instil team spirit and enthuse team members to give their best, are the characteristics of a successful manager. Above all, the key is – a good manager has to contribute to a bulging bottom-line.
In public administration also, all the qualities mentioned above are of importance. However, an additional dimension of evenhandedness, openness, transparency, addiction to principles of natural justice and above all compassion are essential ingredients of successful public administration. The bottom line in this case is not measured in the same way as it is in the case of a private company –
however there is a 'bottom-line' for governance. After sixty years of Independence, the high levels of poverty, illiteracy, rampant corruption, low public health and sanitation standards are indicators of scant regard shown to the nation's 'bottom-line'. If sensex and foreign-exchange reserves were the only indices to measure the quality of governance, indeed we have been successful, at least till mid-2008! But being in the lowest tiers of 'human development index' among the nations of the world, gives a clear picture of the failure of our public administration to contribute to national bottom line.
If a company fails, the responsibility is squarely with the board of directors. If it makes losses year after year and the secular trends are not reversed, it is incumbent on the board of directors to make a serious review and re-examine their policies and methods. They cannot, over a long period of time, blame their managers, or their engineers, or their doormen or even the weather – they have to face the situation squarely. In the Indian context, the board consists of the political executive. If it is argued, ostrich-like, that India is doing well and everything is as well as possible, nothing further needs to be done. Sadly, as we have seen earlier, India is not doing well by any reasonable objective parameter – the examination results are consistently well below the pass percentage! No one can demand two hundred or five hundred years to remove poverty or to raise average living standards.
This book diagnoses the malaise that is afflicting the body-politic. What are the possible routes to find a remedy or cure? Could it be the pressure applied from civil society or a segment thereof ? The upper classes are quite happy with the present dispensation – they call the shots anyway – they will be the last to want any major change. What about the middle class – do not count on them to do anything major or serious – they do not have the stomach for any kind of struggle. In the first place, they don't have the votes. Secondly, they may conduct candle-light vigils, or signature campaigns and such things, which the political class will superciliously ignore. Finally, this class does not seriously believe that anything is wrong with India and do not have the hunger to demand reforms. Indeed, if the middle class, in a concerted manner organises itself, and single-mindedly asks for change, they are likely to succeed. The poor and poorer classes have the votes. Ironically, they are the biggest sufferers – they are the exploited victims of the political class. They live in near-subsistence conditions, much like the zamindars and the nawabs kept them in economic bondage. They just cannot summon up the energy to revolt. Their power to suffer for long, without shedding tears is high. Indeed, most of the leadership emerges from this class. However, the politician quickly kicks the ladder away, as he reaches higher levels and has no need to look downwards again.
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