Movies and media news on waging war on corruption are alliterative music for the ears of anti-corruptionists! Corruption is not only a part of Indian culture but also the rule of the day in many countries, irrespective of whether the set-up is capitalist or socialist. The bureaucratic bottle-necks, under the influence of politics, breed corruption. While India is looking towards the East and the West for economic development or energy security, why is it not looking at the Shariat laws of the Islamic countries or the disciplinary rules of Singapore or China for efficient administration, to accomplish economic success like them?

FDI and Infrastructure

India is lagging behind China in attracting FDI and infrastructural development necessary for boosting economy mainly due to cumbersome procedures and bureaucratic hassles. Because of lack of development due to bureaucratic hurdles, under the influence of politics, talents are wasted resulting in brain-drain; some downtrodden people committing suicide, others resorting to terrorism and naxalism. So, it is natural to see violence raising its ugly head in the vulnerable States and disrupting the harmony of the country at large.

Uniform Sales Tax

In India simplification of multiple taxation systems is long over due. With the introduction of Uniform Sales Tax through out the country the backward and smaller States have lost local business for many products and vehicles except medicines and stationery items due to price rise and for which the central government has come forward to give compensation. But prices of many products are not brought under control. Inflation is going beyond imagination!

VAT System

In this situation as in developed countries Value Added Tax (VAT) System is slowly introduced now with the view to withdraw Central Excise, CST and ST in a phased manner. The purpose of introducing VAT System is for increasing the national revenue and reducing the price of products. In reality, the more new plans and schemes are announced by the politicians in power, the more benefits are enjoyed only by the bureaucrats by way of corruption in nexus with businessmen, while implementing them at the expense of the poor and economic development.

Some form of VAT might be successful in France and other advanced countries in the west because their people in business are educated, well informed and organized and because of strict legal discipline in Nepal, Singapore and other countries in the East. But in India, unless reforms are implemented, VAT will not be successful because of variety, diversity, plurality and complexity in the system.

Taxation and Reduction of Interests

Too much taxation, reduction of interest rates on Provident Fund or bank deposits, etc. due to stereotyped budgeting practices being followed by the party in power are making people lose faith in sincere dealings. They indulge in corrupt practices for making easy money to meet the frequent price hikes and save for the future.

Increase Income by Business

This eternal problem can only be solved by surplus income for all. To make everyone rich in this country, creative economic development is absolutely essential. For that, as in Argentina, Chile or Ireland, the Indian Government should show emphasis on boosting domestic and foreign businesses and not by increased taxation.

If, in spite of implementing innovative measures to enhance trade, taking advantage of economic globalization of the country, corruption level does not come down, India should also adopt, as in China, death penalty for people for indulging in corruption. This is the only way to bring down corruption immediately. Will there be political will to take such steps to eradicate corruption which is the root cause the failure of policies and schemes in India? Only time has to find answer for this question!      

February 24, 2007

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