Re: we can flush out corruption from India

["Siva Karuturi" <siva@buydeal.com>]

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You have put up a wish list! automation of the banking Industry isn't going
to help much in reducing corruption - it's only a peripheral fix.

u have to understand how corruption works - it's sclae, reach and the levers
that operate it. without sounding condescending, a small primer on the
scale: ( i am trying to recollect the figures from the top of my head -
forgive me if they are inaccurate)

At the national level:

from the 2 major sources of revenue to the union government:

Customs & Central excise - annual corruption is to the tune of Rs. 12-15,000
crores

Income Tax    - Rs.15,000 crores

Transport sector - approximately 2 millions trucks on Indian roads - pay on
average Rs.200 per day as bribes at various check points - the math works
out to approximately - Rs.14,000 crores per year

the other major sources at the union level bring the total to approximately
Rs.100,000 crores per year.

to this we need to add the corruption money generated at the state levels.
If you consider a major state like Andhra - a conservative estimate is
Rs.25,000 crores per year.

consider that there are only 10 major states like Andhra - you have a sum of
Rs. 250,000 crores per year.

Adding them up you are looking at ball park figures of Rs.300-400,000 crores
generated across the country every year - fully 15-20 $ of it is converted
into foriegn currency and is funnelled out of the country - this is more
than the official FDI inflow into the country.

unless u attack these sources - what ever else u do or talk about will at
best be superficial.

what we need are fundamental governance reforms to eliminate and curtail
these sources of corruption.

sivaram
----- Original Message -----
From: "Rajeev Sinha" <rajeevksinha@hotmail.com>
To: <debate@indiapolicy.org>
Sent: Monday, April 23, 2001 12:15 PM
Subject: we can flush out corruption from India


> ---------------------------------------------------------------------
> Please help make the Manifesto better, or accept it, and propagate it!
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> The corruption in India is as old as the history itself and its tentacles
> are deep into the system. But in recent days it has appeared in the
ugliest
> faces. Though I would like to discuss here only that face which involves
the
> money transaction. Time to time political parties there, with all its
> politicians (needless to say corrupt politicians) rant the sky with some
> catchy slogans that they are going to remove corruption in next few days,
> but unfortunately corruption is very much there to stay and it's become a
> rule rather than exception. You can face it, feel it on every walks of
life.
> Go to any government office you will feel how the so-called officers suck
> the blood out of you. And the result of this corruption is that even after
> five decades of independence half of the Indians are illiterate (i.e. they
> are quite ignorant of the three R's and can't even write their names) and
> more than 35 crore population is below the poverty line and live in abject
> poverty. If we look at the Indian economy, in terms of purchasing power
> parity, it's ahead of the America, Britain and many so called western
> developed countries, but by the grace of our great national politicians we
> are among the poorest and most corrupt countries in the world.
>
> Despite that I see silver linings of hope that if the current government
> wishes, corruption can be eliminated to a large extent (at least by 80% I
> hope), if not by 100%.
>
> If we see the way of money transaction in America, we find that it's
mostly
> through banks. Banks play a major role in the transaction of money in
daily
> business. You can pay any amount of dollar ( from 1 cent to a billion
dollar
> ) either through your personal cheques or through your credit cards ,
> depending upon its credit limit. The main thing to emphasize here is that
> the electronically transaction of money, makes it more and more
transparent
> to the regulating or law enforcing authority. On a similar pattern we need
> to develop a system in our country. But the biggest hurdle is our
> illiteracy, one billion strong population and half a billion population
> living in poverty. But there is nothing that we can't do. There are many
> ways out of it. Here are the following steps we can firmly and slowly move
> on....
>
> 1. The move of the election commission to issue identity cards has failed
> miserably. The main reason was that no database was properly maintained
and
> many people were able to have identity cards in different names. For
example
> (say) Ram Kumar was able to have identity card in the name of Ram Kumar,
> Shyam Kumar as well as Mohan Kumar i.e. one man with three identity cards.
> Beside that the card had other discrepancies in it like wrong name and all
> that. What I suggest is that every Indian should be issued an electronic
> photo identity card with a unique identity number and most importantly
their
> electronic database should be maintained. The unique identity number can
be
> used everywhere to ascertain the identity of the cardholder (similar to
> Social Security Number in USA) The electronic photo identity card will
have
> magnetic tape on it (just like credit cards) which when scanned will give
> instantly all the details of it's holder person. These kind of electronic
> identity cards are not very costly and are issued to students in many
> colleges and universities in USA, Australia and other countries. This
> electronic photo identity card will play a major role in checking the
> corruption. It will have many benefits like maintaining law and order but
> currently we will stick to its benefit in checking economic corruption.
> The government will later make is mandatory that every person who opens an
> account in banks will have to produce this identity card and people who
> already have their accounts give their identity number to the bank. Banks
> can freeze the account if the account holder fails to produce his / her
> identity number to the bank. The bank can verify the authenticity of
> identity card immediately by scanning through computer through the main
> database. This will put a check on those people who have so many 'benami'
> accounts. Further, when the issue of electronic photo identity card is
over,
> the government can frame a rule so that every transaction of above Rs.
> 5,000/- or Rs.10,000/- in personal accounts are through cheques only and
> individuals can't withdraw cash from bank if it's more than Rs. 10,000/-.
A
> person can do all his/her purchasing and payments electronically through
> Debit Cards or Credit Cards. Of course problems and hardships will arise
but
> we will have to pay the price for cleaning up the society.
> 2. Biggest question arises here is how to and from where to start this
> process? I feel that this process must start in phases. In the first phase
> all those people should be covered who have accounts in banks and this can
> be done in all the states simultaneously. This first phase needs utmost
care
> and cross verifications because it deals with those people who really use
> and misuse their money. In the second phase those people will be covered
who
> are not having any bank accounts. This phase will have another kind of
> difficulty because it constitutes poor and illiterate people. But
> economically they are harmless and I strongly believe that their
> contribution in economic crimes is nil. The whole process can be safely
> stretched to 3-4 years so that cross-verifications are ,in some cases,
> carried out and rectified accordingly.
> 3. With this kind of a system I am confident that it will bring
transparency
> in the transaction of money in India and people will not be able to hide
> their black money. As with this kind of transparency government can see
who
> is earning what and where the money is coming from. This will increase the
> tax-base and tax evasion will be controlled with remarkable success.
> 4. Also the total cost in this issuance of electronic identity card to our
> one billion Indian countrymen will not be more than twenty (20) billion
> rupees . I am sure that the Indian Government can happily afford to spend
> that much amount of money in the span of 2-3 years. ( In case of any fund
> shortage government can seek monetary help from Laloo-Rabdi, Jayalalita
and
> the like. They have enough money )
>
> But the success of whole process needs some prerequisites. I will not ask
> for a strong political will because our politicians do not have that, or
if
> at all they have any will, it is to make money by hook or by crook. So the
> simplest things required are .....
> 1.Expedite the process of computerization of banks in India so that banks
> are connected through networks.
> 2. It needs to make sure that the electronic identity card is not of poor
> quality and it lasts for years
> 3.Strong will of common people to accept the new system which will make
our
> country prosper, else we will be condemned to leave a corrupt, polluted,
> divided, poor, illiterate and undeveloped India for the posterity.
>
> Jai Hind
>
> Rajeev Sinha
> USA
>
>
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This is the National Debate on System Reform.       debate@indiapolicy.org
Rules, Procedures, Archives:            http://www.indiapolicy.org/debate/
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