Anti-Corruption Laws in India

Public servants in India can be penalized for corruption under the

• Indian Penal Code, 1860
• The Prevention of Corruption Act, 1988
• The Benami Transactions (Prohibition) Act, 1988 to prohibit benami transactions.
• Prevention of Money Laundering Act, 2002

India is also a signatory (not ratified) to the UN Convention against Corruption since 2005. The Convention covers a wide range of acts of corruption and also proposes certain preventive policies.^[40]

[edit]Anti-corruption police and courts

The income tax department of India, Central Vigilance Commission and Central Bureau of Investigation all deal with anti-corruption initiatives. Certain states such as Andhra Pradesh (Andhra Pradesh Anti-corruption Bureau) and Karnataka (Lokayukta) also have their own anti-corruption agencies and courts.^[41][36]

[edit]Anti-corruption organizations

A variety of organizations have been created in India to actively fight against corrupt government and business practices. Notable organizations include:

• Bharat Swabhiman Trust established by well known Yog Guru Swami Ramdev running a large campaign against black money and corruption since last 10 years.
• 5th Pillar is most known for the creation of the zero rupee note, a valueless note designed to be given to corrupt officials when they request bribes.
• India Against Corruption is a movement created by a citizens from a variety of professions and statuses to work against corruption in India. It is currently headed by Anna Hazare.^[42]
• Jaago Re! One Billion Votes is an organization originally founded by Tata Tea and Janaagraha to increase youth voter registration.^[43] They have since expanded their work to include other social issues, including corruption.^[44]
• Association for Social Transparency, Rights and Action (ASTRA) is an NGO focused on grass-roots work to fight corruption in Karnataka.

One organization, the Lok Satta Movement, has transformed itself from a civil organization to a full-fledged political party, the Lok Satta Party. The party has fielded candidates in Andhra Pradesh, Tamil Nadu, and Bangalore. In 2009, it obtained its first elected post, when Jayaprakash Narayan won the election for the Kukatpally Assembly Constituency in Andrha Pradesh.

[edit]Effects of corruption

According to a report by KPMG, "high-level corruption and scams are now threatening to derail the country's credibility and [its] economic boom".^[45]

[edit]Economic Concerns

Corruption may lead to further bureaucratic delay and inefficiency as corrupted bureaucrats may introduce red tape to extract more bribes^[46]. Such inadequacies in institutional efficiency could affect growth indirectly by lowering the private marginal product of capital and investment rate^[47]. Levine and Renelt showed that investment rate is a robust determinant of economic growth^[48]. According to the neoclassical growth model, institutional variables contribute to determining steady-state per capital income levels and speed of convergence to its steady state, hence affecting its growth rate^[49].

Bureaucratic inefficiency could also affect growth directly, such as through misallocation of investments in the economy^[50]. When a country’s economy is below its steady-state income level, higher corruption could result in lower growth, for a given level of income^[51].