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India improved a sharp 108 positions in bribery index for 6 years ended 2020
By Dr. Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India
The report released by TRACE (Nov-20), puts India is at the 77th position in a global list that measures business bribery risks of 2020. It is quite impressive to note that over the years India’s position in bribery risk ranking has improved significantly. In 2014, India was ranked 185th position out of 197 countries. We believe that India has made such impressive progress primarily due to the Government’s mandate to remove corruption and bribery from all sections of society. In 2018, Government has amended the ‘Prevention of Corruption Act, 1988’ after 30 years to introduce a number of new provisions, including criminalizing the act of giving a bribe in addition to taking it and at the same time putting in place an effective deterrence for such actions by individuals as well as corporate entities.
The trend in the total number of actions taken by Central Vigilance Commissions (CVC) from 2008 to 2019 suggests that the number of complaints has declined since 2014 to only 32,579. The number of punishments carried through own investigations by CVC is also declining. This clearly shows the general public is having more faith in cleaner administration now as compared to earlier and hence outside complaints are declining. This also shows over the years, leveraging of technology and adoption of the latest technological initiatives like e-tendering, e-procurement, and reverse auction have helped in bringing transparency in governance and this should be continued with gusto.
Does such reduction in corruption have had an impact on economic growth? Our cross-country analysis between 20102 and 2018 shows that countries like India, UK, Egypt, Greece, Italy, etc. that succeeded in reducing the corruption level by improving their overall rank in corruption perception index (as published by Transparency International) have also achieved a positive GDP growth. India has stood tall among the rest of the developing countries by improving its overall rank from 94 in 2012 to 78 in 2018.
We however have a small suggestion. Even though the corruption act has been rightfully modified in 2018, some radical amendments can banish the idea of corruption altogether (as suggested in 2011 also). The central idea is that we should declare the act of giving a bribe as a legitimate activity. In other words, the giver of a harassment bribe should have full immunity from any punitive action by the state. But the person, taking the bribe should be punished. Thus when a person gives a bribe, he/she will try to keep evidence of the act of bribery so that immediately after the bribery he/she can turn informer and get the bribe-taker caught. The upshot of this is that the bribe taker will never take the bribe in the first place. In this way, we can actually achieve a Nash Equilibrium (commonly called in economic parlance) with an optimal payoff for the society. We can also find the idea of such Nash equilibrium in the relation between Banks and Corporates post AQR
The other alternative is to penalize the bribe-taker of more stringent action than the bribe giver and make a clear distinction between the motives!
source https://nrinews24x7.com/state-bank-of-india-ecowrap-swachh-bharat-is-a-recipe-for-indias-growth/?utm_source=rss&utm_medium=rss&utm_campaign=state-bank-of-india-ecowrap-swachh-bharat-is-a-recipe-for-indias-growth
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