Legalizing the Illegal

Legalizing the Illegal
 Senior JDU MLA Rajiv Ranjan (now suspended) has proposed  that Bihar government should enact a new law to legalise corruption in the state. He has proposed that the law should be named Right to Bribe, on the lines similar to right to information (RTI) .He said that he was proposing this extreme legislation out of frustration arising from the inability of the Bihar government to control corruption.

Mr Ranjan’s outburst appears to be typical – a politician feels wronged and so makes thoughtless statements. But Mr Ranjan is not a run of the mill politician. He is a technocrat who has held high offices- Director of Power Finance Corporation, Chairman of Chattisgarh State Electricity Board and Chairman of Jharkhand State Electricity Board. So we will have a closer view of the larger issues involved.
First, let us accept that Bihar is not the only state with this dubious distinction. If amount of generation of black money be a barometer of corruption, then other states would be far ahead. It is a national issue. Mr Ranjan should not have taken a narrow view , unless there were political compulsions.  
Economist Mr Kaushik Basu (ex Chief Economic Advisor to Government of India) has made similar proposal but in different vein.
Mr Basu has argued that “harassment bribes” should be a legitimate activity. Such transaction should be for getting services to which one is legally entitled. Examples-  an income tax refund or customs clearance for an exporter’s / importer’s  goods.
In theory, once a deal is over, the bribe giver may be interested in cooperating in getting the bribe taker caught, knowing that he or she will not face any punishment. That possibility could deter the bribe taker from taking a bribe in the first place. Presently the interests of both converge, since both payer and taker face punishment if caught, and so the payer has a reduced interest in uncovering bribery.
The USA has found a  solution to this problem. They call it lobbying. Lobbying can be thought of as controlled corruption. Businesses officially register as interest groups and approach political leaders with proposal. Any transaction that takes place between the politician and the lobbyist is recorded.
In India seeking financial support from business houses is not well regulated and therefore a political leader and a businessman can join hand to take advantage of the system. This can cause losses to the tune of  thousands of crores to the nation.
Thus the Americans have a way of regulating such transactions.
Saudi Arabia
In Saudi Arabia it is common to use agents or intermediaries in procuring government contracts. Foreign companies hire services of local agents who use their knowledge of the local economy for winning contracts in exchange for commissions that may go upto 20% of the value of business. It is another story that most such intermediaries have to be Saudi Nationals. In practise those close to royal family handle big ticket transactions.

Saudi Arabia's Government Tenders and Procurement Law does not prohibit such practice. However, other laws provide restrictions specific to military contracts.

As per Article 47(a) of the Procurement Law, purchase from manufacturers of weapons, military equipment and their spare parts is exempt from the Procurement Law.  Council of Ministers Resolution No. 1275 provides that no company may pay any sum as commission to any intermediary, sales agent, representative, or broker for any military contract.
So in Saudi Arabia such transactions are being regulated.

Coming to our country- are we fighting a losing battle?
There is a saying- if you can’t fight them, then join them! If it is so, then proper laws need to be put in place so that all transactions happen over the table.

More By  :  Navin Chandra Mishra

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  • Comments: 3

Comments on this Blog

Comment Deepak Da, a big chunk of public funds are go waste because of leakages in our system. The common man is also harassed while the resourceful sail through all the entanglements and web of official system. All governments promise to make things transparent and simple. Yes, it is possible, but out of frustration the step suggested by Mr Ranjan will do more harm than good. This is my opinion.

16-Jan-2015 20:28 PM

Comment I am late but still - 'Real Fishy'

Deepak Chakraborty
16-Jan-2015 00:02 AM

Comment Better to legalize everthing, decoity, murder, rape everything

27-Aug-2014 02:52 AM

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