Records tell that India has a long distance to cover to contribute to the BRICS recent plan of working together to combat corruption. However, if the promise of corruption-free India till 2022 is taken seriously, India would be used as a model to follow in rest of the Asia.
Corruption still drags on India and China
Earlier this month, BRICS countries wrapped up their ninth summit, “Stronger Partnership for a Brighter Future” in Xiamen, China. The summit resulted in a concrete declaration to support international cooperation against corruption, including through the BRICS Anti-Corruption Working Group. The move comes as new developments from India and China show that it will be a long time before either of the association’s biggest members can truly contribute to the plan. However, recent initiatives to combat corruption in India have shown real promise – and can be duplicated elsewhere in Asia and other developing countries.
India: black money and bribery
Despite Prime Minister Narendra Modi’s pledge to end corruption by the country’s 70th birthday, India passed the mark with a slew of missed goalposts and disappointed expectations. Most recently, the Reserve Bank of India said that its move to ban large bank notes last November as part of an effort to crack down on bribery only appears to have accomplished the opposite. In the end, 99% of the demonetized 500- and 1,000-rupee notes were deposited or exchanged for new money. And the demonetization initiative didn’t only backfire; it also resulted in a wider slowdown of economic growth that affected agriculture, the rural economy, and property.
The failed scheme arrived soon after another major corruption scandal that laid bare the continued problem of rampant bribery in Indian hospitals. The issue was exposed following the deaths of 60 people in Uttar Pradesh hospital over five days due to insufficient oxygen supplies. The company providing the oxygen reportedly cut off the supplies after the hospital had repeatedly failed to pay their bills. In India, public officials frequently push their vendors for “commissions.” It’s common knowledge that even after public contracts are handed out, vendors still have to beg for payment, and the best way to guarantee a steady flow of compensation is to hand the officials in charge a “bonus”. When they were asked whom they blamed for the deaths, several parents of children who died due to lack of oxygen said “corruption.” The head of the medical college, who has now quit, was already suspected of mishandling public funds.
The China example
Like Modi, President Xi Jinping has also been leading a much-publicized campaign to crack down on bribery among civil servants and corporations in China – which, despite the prosecutions of thousands, has had mixed results so far. For instance, China’s new anti-corruption “super agency” will start work in March 2018, but the draft State Supervision Law that sets up that body has not been made public. What is known about the agency and the law signals that the government will only entrench a broken system, not fix it. According to Human Rights Watch, the agency will consolidate anti-corruption powers that are currently distributed among different government agencies, gain new powers of detention, and most worrisome of all, share space and staff with a powerful Communist Party body that is charged with enforcing Party rules. At a time when even China’s own regulatory officials continue to be charged with graft, consolidating anti-graft bodies in such a way seem no way to tackle the problem.
Not surprisingly, the same corruption that seeps throughout government agencies has affected the private sector, as well. One of the biggest cases involved British drugmaker GlaxoSmithKline. Mark Reilly, the former China boss of the company, and two other colleagues were charged with corruption in 2014 following a 10-month investigation into how the firm made billions of dollars by bribing medical staff and hospitals. Because of cases like this, healthcare has become the main focus for the president’s campaign against corporate graft, with global and Chinese healthcare companies including Bayer and Nestlé becoming the subject of probes for corruption.
Possible solutions
In his address to the Indian people during Independence Day celebrations last month, Indian Prime Minister Narendra Modi insisted that there would be a New India by 2022 – one that would be “free of casteism, terrorism, corruption, nepotism.” In order to fulfil these promises, however, New Delhi will need a more realistic plan to tackle graft by the time it celebrates three-quarters of a century. One promising new initiative comes from a number of large firms, which are joining up in support of better ethics and business practices in India and South Asia. The firms plan to work with the business ethics advocacy group Ethisphere Institute to create a strategy to make anti-corruption a regular part of everyday business considerations and conversations. If successful, such a plan could be duplicated in other Asian countries, not least China.
On top of such private-driven initiatives, New Delhi and Beijing alike must enforce broader, international initiatives, like the OECD’s Anti-Corruption Action Plan for Asia and the Pacific. The plan, which was originally formed in 2001, is formally endorsed by 31 countries today including India and China. But endorsing the plan simply won’t be enough. Both countries must do more to carry it out effectively, such as crafting and enforcing more laws to proscribe conflicts of interest and simplifying mechanisms for anonymously reporting instances of bribery.
These private- and public-driven initiatives to combat corruption are only some of the many tools at the disposal of India and China. Now, with both countries continuing to score low in international measures of transparency, it’s up to them to not only issue declarations about the importance of combatting corruption, but also to take concrete action. Otherwise, statements like those issued at the BRICS summit will remain nothing but that.