Corruption And India

Corruption is the wall that is standing between a developing India and a developed India. Corruption in India is an issue that is affecting the country’s economy in many ways. Corruption is not just holding the economy back but has also not allowed the country to develop.

Corruption and its Causes

Corruption is a form of criminal activity undertaken by the people for acquiring illicit benefits. Corruption is practised by every person where it’s just that poor people and middle-class people do it on a small level and in contrast, rich people and politicians do it on a higher level by misusing the public power for private gains. 

Causes behind Corruption in India include[1]:-

  • Lack of Transparency in Deals and Affairs;
  • Unhealthy Competition Encouragement in India;
  • Unemployment; 
  • Poverty and Hunger;
  • Overpopulation is one of the biggest reasons for corruption.

There are many more reasons why there is corruption in our country, but human beings’ nature is the main reason. People have a great desire to lead a luxurious and comfortable life. As a result of earning them fast, they get involved in activities that would end with immediate monetary benefits.    

Biggest Corruption Scams in India

  1. Abhishek Verma Arms Deals Scandal – In 2006, Abhishek Verma was accused of receiving $200 Million[2], approximately Rs. 80,000 Crores at that time, through a 4-5 Billion Dollars Indian military deal involving the Indian government’s purchase of six Scorpene-class submarines. The case, thereafter, was solved by the CBI. After multiple instances of corruption and money laundering against Abhishek Verma, he was arrested in 2012.
  2. 2G Spectrum Scam – It was revealed that in 2008, the government had undercharged mobile companies for frequency allocation licenses. These licenses were used to create a 2G spectrum[3] subscriptions for cell phones. In 2012 Supreme Court of India declared that the spectrum’s allotment was unconstitutional and undercharged and cancelled the 122 licenses issued in 2008 under A. Raja, then Minister of Communications and IT.
  3. Commonwealth Games Scam – In 2010, one of the major scams of approximately Rs. 70,000 Crores took place[4]. The athletes were allegedly asked to move to shabby apartments from the ones that were allotted to them by authorities; reports of the Central Vigilance Commission, in-charge of the investigation of the CWG Scam, revealed that the chairman of the organizing committee of the games, Suresh Kalamandi offered a contract of Rs. 141 crore, which was unnecessarily high by Rs. 95 Crores to swiss timing for its timing equipment. All the accused were charged with criminal conspiracy, cheating, and were also charged under corruption prevention sections.

These were some of the shameful acts why our country is still developing and not a developed nation. The consequences that arise because of these corrupt acts are:-

  • Obstacles in Development – Corruption is like cancer, slowly affecting the economy’s wealth and prosperity, which is a significant loss for India’s future. India has shown an incredible rise in corruption rates. Because of which many development projects are being delayed for their completion.
  • Backwardness and Poverty – Despite having undertaken various measures like the announcement of monetary packages to curb poverty, there is no improvement. The poor are becoming poorer and the rich are getting wealthier. After all, the funds allocated for poor people’s development and the used funds are significantly less because the corrupt politicians take the rest for their gain.
  • Loss of Faith – Chances of Corruption could result in people losing faith in the country’s judicial system.

Corruption Laws in India

Some Laws made to fight Corruption in India include:

1. Indian Penal Code, 1860

  • Section 169 of the Code pertains to a public servant unlawfully buying or bidding for the property. A public servant shall be punished with imprisonment of up to two years or with fine or both and purchased property, if any, shall be confiscated. 
  • Section 409 pertains to criminal breach of trust by a public servant. The public servant shall be punished with life imprisonment or imprisonment of up to 10 years and a fine.
  • Public servant, as per the Code, refers to government employees, military officers, police, judges, etc.

2. The Benami Transaction Act, 1988

  • The Act prohibits any property purchase in the false name of another person. Simply put, it means purchasing a property in the person who didn’t pay for it.
  • Any person who enters Benami Transaction is punishable up to 3 years of imprisonment or fine or both.
  • Any property held to be Benami will be taken into acquisition by the prescribed authority, and no money or compensation will be provided back.

3. The Prevention of Corruption Act, 1988

  • If a public servant takes gratification other than his legal remuneration regarding an official act or influences public servants, he would be liable to a minimum punishment of six months and maximum punishment of five years and fine. The Act also penalizes a public servant for taking gratification to influence the public by illegal means and exercising his influence with a public servant. 
  • If a public servant accepts a valuable thing without paying for it or paying inadequately from a person with whom he is involved in a business transaction in his official capacity. In that case, he shall be penalized with a minimum punishment of six months and a maximum of five years punishment and a fine. 
  • It is necessary to obtain prior sanction from the central or state government to prosecute a public servant.
  • Some categories were added to IPC. The definition of Public Servants now also includes office bearers of cooperative societies receiving financial aid from the government, employees of universities, Public Service Commission, and banks. 


4. The Prevention of Money Laundering Act, 2002

  • This Act states that any person has committed the offence of money laundering only if somehow he is connected to any proceeds of crime. Proceeds of crime here mean that any property acquired through criminal activities related to the offences listed in the schedule of the Act.
  • The punishment for committing the offence of money laundering is rigorous imprisonment for three to seven years and a fine up to Rs. 5 Lacs.

Demonetisation in India, 2016

Demonetisation was one of the giant steps taken in the history of India to curb corruption and black money. On 8th November 2016[5], India’s government announced the demonetization of all old Rs. 500 and Rs. One thousand banknotes of the Mahatma Gandhi Series and the issuance of new Rs. 500 and Rs. 2,000 banknotes in exchange for the demonetized notes were announced. The main objectives of this step were:-

  • Removing of black money from Country – As the old currency of Rs.500 and Rs.1000 was banned, people will have no choice but to get their cash notes exchanged from the banks, and the money earned by doing illegal activities will have no value any longer.
  • Removing corruption – As the old currency has been demonetized, it will lead to the end of all black money and because of which people won’t be able to practice any illegal task.  
  • Curbing Fake Notes – Demonetisation will stop the circulation of the fake currency revolving in the economy, which is Guessed to be around 400 Crore.

Despite having various laws against corruption and taking significant steps like demonetization, India is still failing to remove corruption from its economy, resulting in delays in development, low GDP, etc. The main problem lies in the implementation of the corruption laws and the pressure, interruption, and manipulation created by politicians on the Institutes that are fighting to remove corruption from the country, such as the Central Bureau of Investigation (CBI), Enforcement Directorate (ED), Anti-Corruption Bureau (ACB), Comptroller and Auditor General’s (CAGs).

Solution and Suggestions

  • Better Implementation – Effective Implementation of the law is essential to ensure that the corrupt are punished and break the cycle of impunity
  • Promote Transparency – To become successful at curbing corruption, the government needs to be open to the public; there should be complete transparency and information access.
  • Close International Loopholes – Without having access to the International Financial Systems, people won’t be able to hide their looted assets and black money earned through illegal activities.
  • Empower the Citizens – Create ways that give citizens the power to participate in government activities and hold them liable for any mishappening.
  • Change People Attitude – This is one of India’s significant problems where every person, whether middle class, lower class, or wealthy, thinks that illegal ways can achieve any work that is not possible or will legally take a long time. They don’t even think before doing something against the law because there is no law fear.   

Corruption is an evil that needs to be addressed at the earliest and needs to be curbed away as soon as possible because if it remains in our country’s economy, then it will never let our developing nation become a Developed Nation.


[1] (Last visited September 13, 2020).

[2] (Last visited September 13, 2020).

[3] (Last visited September 13, 2020).

[4] (Last visited September 13, 2020).

[5] (Last visited September 13, 2020).

BY- Kashish Dhawan | Vivekananda Institute of Professional Studies, GGSIPU, Delhi


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