SPEAKING
FREELY Corruption a thorn in India's
side By Saloni Kapur
Speaking Freely is an Asia Times
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India's Central
Bureau of Investigation on April 3 detained two
bureaucrats in connection with a corruption
scandal relating to the Adarsh Housing Society in
the up market Colaba district of Mumbai, the
country's commercial hub.
Meanwhile,
Indian yoga guru Swami Ramdev announced that he
intended to lead a demonstration in the Indian
capital New Delhi on June 3. The gathering, which
will take place at the city's Jantar Mantar
monument, will be held to protest against
corruption and the country's parallel economy, and
will mark the first anniversary of a police
crackdown on another demonstration organized by
Ramdev in New Delhi over
the same issues. In addition, an associate of
Ramdev, Acharya Balkrishan, stated that Ramdev and
his supporters were launching a nationwide
anti-corruption movement from April 1 and that
anti-corruption crusader Anna Hazare was
supporting the peaceful movement.
Recent protests A social
activist from the village of Ralegan Siddhi in
Maharashtra, Anna Hazare, commenced a hunger
strike at Jantar Mantar in April 2011 to call for
a stringent anti-corruption Lokpal law. Hazare
struck a chord with middle- and lower-class
Indians, who joined the nationwide gatherings that
took place over the next several months en masse.
Ramdev, who has a large following as a yoga guru,
joined the fray, staging a hunger strike of his
own at New Delhi's Ramlila Maidan in June 2011.
The police's use of force against Ramdev's
supporters at Ramlila Maidan overnight in June
2011 triggered additional protests against the
incident, in India as well as outside Indian
embassies abroad.
The United Progressive
Alliance (UPA) government, led by the Indian
National Congress party, succumbed to the pressure
and in August 2011, the two houses of parliament -
the Lok Sabha and the Rajya Sabha - acceded to
Hazare's three main demands relating to the Lokpal
bill. Demonstrations tapered off thereafter,
though Hazare has continued to express
reservations regarding the version of the bill
that parliament is mulling over. The self-styled
Gandhian led peaceful rallies over the issue in
December 2011 and March 2012. Meanwhile, Ramdev,
who appears on television channels every day, has
been calling for the authorities to orchestrate
the return to the country of laundered money that
has been stashed away abroad by Indian citizens
and criticizing the government's policy of
allowing foreign companies access to the Indian
market.
Serial scandals While
both petty and high-level corruption have long
been irritants for common Indians, the trigger for
the ongoing spate of protests was a series of
scandals that emerged after the UPA got re-elected
to a second term in office in May 2009. Congress
MP Shashi Tharoor - a former United Nations
under-secretary general - stepped down from his
position as junior foreign minister in April 2010
amid a scandal revolving around the award of
shares in an Indian Premier League team to his
alleged mistress (who went on to become his wife).
The Commonwealth Games that India hosted
in 2010 were not blemish-free either. Congress MP
Suresh Kalmadi, the head of the Commonwealth Games
organizing committee, went to prison after he was
arrested on corruption charges in April 2011.
Meanwhile, the Adarsh housing scam, which
first came to light through the news media in 2003
and again became an issue of national interest in
2010, involves the flouting of numerous rules in
the construction of the Adarsh Housing Society,
for which the Maharashtra government allotted land
to provide accommodation for serving and retired
military officers. Questions have also been raised
over the allotment of apartments in the complex to
certain politicians, bureaucrats and military
officials. Three former chief ministers of
Maharashtra, all belonging to the Congress party,
have been implicated in the scam.
Former
UPA telecom minister A Raja was arrested in
February 2011 for allegedly undercharging telecom
companies in a 2008 auction of 2G spectrum for
cellular telephones. The authorities also arrested
another MP from Raja's Dravida Munnettra Kazhagam,
Konimozhi, a suspected co-conspirator.
While it is the UPA that has primarily
been in the spotlight over corruption, the main
opposition Bharatiya Janata Party (BJP) has not
gone scot free. In July 2011, three BJP ministers
from the southern state of Karnataka were accused
of having forced mining companies to give up up to
45% of their iron ore to the ministers.
Potential for unrest Although
violence occurred during Ramdev's previous
agitation at Ramlila Maidan, the ongoing protest
movement that began on 1 April, including the
planned gathering at New Delhi's Jantar Mantar on
3 June, is likely to be peaceful. The vigor of the
demonstrations has abated after parliament acceded
to the three principal demands made by Hazare.
Moreover, it emerged in October 2011 that Kiran
Bedi, one of Hazare's main aides, had been
charging organizations hosting her business-class
airfares while travelling economy class. While
Bedi claimed that the profits gained from this
discrepancy were used to fund a non-governmental
organization she heads, the reports have tainted
the image of Hazare's consortium. As a result, a
lower turnout is expected for the ongoing
demonstrations than was seen in 2011, despite the
fact that corruption remains a key area of concern
for the Indian electorate.
Furthermore, in
February 2012, the country's Supreme Court
reprimanded the police for using batons against
Ramdev's supporters overnight on 4-5 June 2011,
calling it an attack on 'the foundation of
democracy' by the 'might of the State' and
ordering the criminal prosecution of police
officers who were involved. Against this backdrop,
the security forces are likely to be reluctant to
resort to force to disperse anti-corruption
protesters this time around.
Economic
impact of corruption While multinational
companies could and do include bribe money in
their budgets for operating in the developing
world, in the Indian context, this is coming to be
seen as a risky proposition: following the
exposure of the irregularities in the auction of
2G spectrum, the Indian Supreme Court cancelled
122 2G licenses issued to telecom companies, some
of which had foreign investors. The authorities
have refused to give in to a demand by several
companies to restrict the forthcoming auction to
players whose licenses were cancelled the first
time around. Although Telecom Minister Kabil Sibal
insists that foreign investors are willing to
participate in the second auction, it remains to
be seen how many do take part the second time
around.
The 2G case is likely to deter
multinationals from engaging in corrupt practices
in India. The fact that corruption is so
widespread means that doing business in the
country may become problematic once the option of
bribery is off the table. Another recent
development, although not corruption-related,
makes foreign investment in the country appear
even more hazardous: The Indian government has
decided to retrospectively amend its tax laws,
imposing a tax on overseas transactions that
result in a transfer of assets in India.
Accordingly, the Indian government has demanded
that multinational telecom giant Vodafone cough up
$2.3 billion in tax on a deal it transacted with
Hutchison in the Cayman Islands to buy the
latter's shares in India-based joint venture
Essar. Vodafone has criticized the retrospective
nature of the change in legislation, claiming that
it will undermine India's attractiveness as an
investment destination.
Domestically,
corruption acts as an impediment to would-be
small-time entrepreneurs. However, analysts have
argued that graft, bribery and cronyism have been
important factors in India's growth story, helping
large capital to access resources and rake in huge
profits. The 2G scandal is a case in point.
Saloni Kapur is a former News
Editor specializing in South Asia for the London
office of Travel Security Services: a joint
venture between International SOS and Control
Risks. The views expressed here are her own.
Speaking Freely is an Asia Times Online
feature that allows guest writers to have their
say.Please
click hereif you are interested in
contributing. Articles submitted for this section
allow our readers to express their opinions and do
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