A thumbs up for transparency
The Supreme Court’s verdict on electoral bonds is very welcome, but corruption remains a huge challenge for India
The Supreme Court of India’s decision to rescind electoral bonds should be celebrated. Electoral bonds, introduced by the Narendra Modi government in 2018 just before the 2019 elections, made donations to political parties — earlier paid as bribes — legitimate and legal. Since the names of the donors or the recipient party were not disclosed, with only the State Bank of India (a government-owned bank) keeping the information, it was an opaque system that benefitted the party in power. These purchases were not even known to the Election Commission. The pay-for-play scheme essentially legislated what is known as Grand Corruption. The Supreme Court’s decision puts an end to this. The Court has also directed the government to make a full disclosure of which party received the money under this scheme.
Whether this will affect election funding for the upcoming general election remains to be seen. However, over the longer term, the question remains: What will come in its place?
Will we go back to the old system of suitcases full of cash and the various scams parties in power used to raise money for election campaigns? Or can India develop a better system not only to deal with election-related corruption but corruption in general, which has been a bane of our economic and political system.
The government has issued a White Paper that tries to paint the previous United Progressive Alliance (UPA) government as riddled with corruption. The current government claims to have reduced corruption and leakages under the rubric of “Maximum Governance and Minimum Government.” There is no doubt that the previous UPA government was plagued by corruption. Even if some claims of scams during its tenures were outrageous and incorrect, as in the case of the telecom scam when the then Comptroller and Auditor General Vinod Rai made exaggerated calculations on the amounts involved, corruption under UPA undoubtedly remained high. The National Democratic Alliance (NDA) government now claims it has reduced corruption hugely. Transparency International, a reputable international body measuring corruption, shows that India’s corruption score did improve once the NDA came to power. The TI corruption score, which is based on perceptions of business and experts, on a scale from 0-100 (where 100 means no corruption), improved from 36 in 2013 to 41 in 2018 (see Table 1). However, it has since deteriorated to 39 in 2023, falling below the global average score of 43. India scores better on this index than several G20 middle-income countries such as Brazil, Mexico, Indonesia, and Turkey, but lags behind China and Vietnam. India’s TI Corruption rank in the world improved from 94th in 2013 to 78th in 2018 but has fallen back to the 93rd rank among 180 countries. Corruption was reduced initially, when the NDA came to power, but the gains have been reversed to some extent.
In addition to the perceptions of businesses and experts, it is crucial to consider the viewpoint of the common citizen, the aam aadmi. The NDA government claims that corruption has reduced due to better delivery of various services and subsidies directly to citizens, without intermediaries siphoning off a part of their benefits. The widespread use of e-services, with Aadhaar authentication, it says has minimised leakages and corruption. While some of these claims may be true, the common citizen still complains about the bane of widespread petty corruption. Whether you want a ration card, register any document, or are paying taxes, some side payment is needed. This has been verified in a global survey done by Transparency International, which revealed that India ranked the worst in Asia in terms of citizens having to pay bribes in 2020 (Table 2), with 39 per cent reporting that every time they dealt with an official, they had to pay a bribe, much worse than even South Asian neighbours like Bangladesh, Nepal, and Sri Lanka. Corruption has become a way of life in India. Judicial and police corruption is rampant and often in plain sight on roads and in court offices, and the poor tend to suffer more than the well-off.
However, many countries have reduced corruption over time — so must India. The way forward involves more transparency, minimising officials’ discretion, and greater competition in the availability of services. Strong enforcement against corruption is also a part of the solution, but only if it’s not used selectively and does not appear to be a political tool. The era of the Tax Inspector Raj must come to an end. Some countries have used Corruption Commissions to address corruption, but their record is mixed. It’s clear that draconian one-off measures such as demonetisation or the legalisation of corruption through mechanisms like electoral bonds are not sustainable solutions. Instead, a more systematic approach is required to streamline government processes and untangle the web of laws that inadvertently contribute to corruption.
Having delivered a significant verdict, the Supreme Court must also consider prioritising the improvement of the corrupt judicial system at the lower levels, over which it presides. A Swachh Bharat does not only mean clean streets and toilets, it must also encompass a cleaner and more transparent governance system.