Corruption and Poverty in India

Corruption and Poverty in India

Ask a foreigner to come up with a list of things they know about India, and they will probably include plenty of good things: our rich cultural and spiritual history, our world-famous cuisine and iconic architecture. Most would also list two much less good things: corruption and poverty. While these are certainly not all that India is known for around the world, they are two of the things we are best known for.

Cycles of Corruption

As India’s economic stature grows, so the world takes a greater and greater interest in our country. American firm Wal-Mart has just named India as one of the world’s most corrupt nations, based on their experiences while doing business. Corruption seems to be endemic in India, and not only does it create a poor image of the country abroad, it helps to keep many Indians living in poverty.

Corruption and poverty are inevitably linked. When someone extorts money, that money could have been used to fill a hungry belly. It is impossible to divorce poverty from corruption. It takes money from those who need it and it makes it difficult to get things done well. A chain of corruption develops, from the lowliest official to the government. If a poorly-paid government official sees those above him taking or making bribes, then he will more than likely think nothing of supplementing his own income by deliberately ‘losing’ paperwork until someone pays up to make him ‘find’ it again. Some of those junior officials move up through the organisation, and they continue to run it the way they are familiar with, and so the cycle continues.

Ending the Cycle?

Corruption creates a society in which chaos reigns. People have little or no trust in the government or in businesses. People see that they only way to get ahead is for every man to work only for himself, and so they do the same. While some self-interest is useful for economic growth, it must not be at the expense of integrity. When people – from the poorest to the richest – have some joint social capital and a shared interest in making the society better, things improve. Those who hold political and economic power begin to feel a sense of their own public liability and position in the community. If some of that self-interest were to be channelled into social interest, we would likely see the poverty rate come down. If a business doesn’t have to pay others just to keep going, then they might have more money to invest. They might improve working conditions and pay their workers more. If they pay their workers more, then their workers will spend more, and every business will benefit. More jobs will be created, and poverty will lessen.

That all sounds simple, but changing an ingrained culture is not easy. Change has to come from the top. It also has to pervade throughout the judiciary and the police. If people see that justice is not done in society, then they will not have any reason to be just themselves. If the wealthy know that they can get away with crimes (from simple traffic offences to murder), then they will try and pay their way out. If an official knows that they are likely to be able to make money through bribery, then they will do.

What practical solutions are there to stop this from happening? Corruption can be prevented if the penalties for being corrupt are likely to be higher than the financial gains from corruption. If an official knows they may lose their job if they take a bribe, they will probably choose not to take a bribe. If change comes from the top, it will work its way down. If the highest officials fear losing their jobs if they are corrupt, so they will work to stop those beneath them from being corrupt. Corruption can also be tackled through greater transparency. Everyone knows that corruption happens, but that does not mean it is done openly. However, computerisation provides a great opportunity to increase transparency. Electronic files are much harder to ‘lose’ than paper ones, and computerised systems can be monitored centrally.

Tackling corruption could be done – not every country in the world is corrupt, and the perception among some that it cannot be fixed is wrong. However, for real change to happen there must be real leadership.