India's telecoms scam casts shadow over prime minister (News Feature)

By Sunrita Sen Nov 19, 2010, 11:37 GMT

New Delhi - Bribes and kickbacks are not new to India, but a recent spate of financial scandals has put the ruling Congress Party on its back foot and now threatens to tarnish the image of Prime Minister Manmohan Singh, the government's icon of integrity.

Angry opposition lawmakers stalled Parliament yet again Friday, demanding that Singh explain why he delayed replying to requests by an opposition politician in 2008 seeking permission to prosecute the then-telecommunications minister Andimuthu Raja, who is at the centre of the latest scam.

Prosecution of a cabinet minister in India has to be cleared by the prime minister.

Raja resigned Sunday, two days before a government auditor's report was tabled in Parliament accusing him of granting 2G spectrum licenses at throwaway prices in 2008 by bending rules and ignoring the advice of the Finance and Law and Justice ministries.

The report said Raja's decisions might have led to losses worth 39 billion dollars to the government.

Raja belongs to a key southern ally of the Congress Party, the Dravida Munnetra Khazagam (DMK). Singh's minority government is propped up by several regional allies like the DMK.

India's Supreme Court on Thursday asked Singh to give a written explanation for his alleged silence on Janata Dal lawmaker Subramaniam Swamy's plea to prosecute Raja.

The opposition, led by the Hindu nationalist Bharatiya Janata Party (BJP) and leftist parties, has been demanding a joint parliamentary investigation into the scam. Lawmakers have brought business in Parliament to a halt for six working days.

Battered by repeated allegations of financial misdealings surrounding preparations for the October Commonwealth Games in New Delhi, the Congress-led United Progressive Alliance is edgy.

Raja is not the only black sheep troubling the party. Ashok Chavan, a member of the party, was recently forced to resign as chief minister of Maharashtra state after reports suggested his mother-in-law was allotted a flat in an apartment block in Mumbai meant for war widows and heroes.

Two officials of the Commonwealth Games organizing committee have been arrested on charges of corruption relating to contracts for the games, and Suresh Kalmadi, chairman of the committee has been removed from a Congress Party post - all in November.

That corruption is endemic in India is no secret. It pervades every aspect of life from bribing a police officer to escape charges for a traffic misdemeanour to giving a tax official a cut to get back income tax returns.

President Pratibha Patil in a speech in 2009 said India was losing precious resources to corruption.

'Like a cancer, corruption is that sore which drains the strength of a nation,' she said. 'Corruption has deprived the nation of better infrastructure and better facilities.'

'The people feel let down, the nation loses resources and we lag behind others,' the president said. 'It is one malaise which brooks no delay.'

A recent report by the Washington-based non-profit Global Financial Integrity estimated India had lost more than 400 billion dollars to corruption, bribery and tax evasion since its independence in 1947.

The money could have been put to good use, the report's author, former International Monetary Fund economist Dev Kar said.

'We could have had better schools, better health programmes, better nutrition programmes for the poor,' Kar said. 'Children could have been vaccinated. Malnutrition could have been better tackled.'

Big business and corrupt politicians and bureaucrats often work in collusion. One of India's best-known industrialists, Ratan Tata, recently said his Tata Group could not set up a domestic airline in collaboration with Singapore Airlines in the mid-1990s because it did not pay off officials, as was suggested by another industrialist.

Business leaders acknowledged that pervasive corruption is one of the main reasons hampering India's growth along with weak governance and toothless regulators. The issue came up repeatedly at the World Economic Forum's India summit in New Delhi this week.

To be fair, its not just the Congress Party. When BJP president Nitin Gadkari held a press briefing in Delhi Thursday to charge the Congress Party with corruption, television headlines focused on allegations that a BJP chief minister, B Yedurappa of Karnataka, had changed rules to enable his sons to buy prime land.

Law and Justice Minister Veerappa Moily told federal investigators in 2009 that there should be zero tolerance for corruption and suggested e-governance and systemic change as possible ways forward.

Vigilance officers have been appointed in recent years in government ministries and state-affiliated banks and anti-corruption bureaus across the country. A landmark right-to-information law aimed at more accountability has also been passed by Parliament.

But given the scale of the problem, it might take a long time to see an improvement because, as Moily said, 'The cancer of corruption has seeped into the bloodstream of our polity.'

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