Corruption is not exactly new in India.
Quite apart from the extensive historical evidence of its spread, during
and after the "mixed economy" period of state planning, the
"licence-permit raj" was regularly accused by commentators of
breeding graft, constraining economic activity and forcing citizens to
be at the mercy of corrupt officialdom at all levels.
So if this is an old problem, why has it suddenly become such a hot political
issue? Has Indian society now come of age, as the citizenry demands official
transparency and freedom from corruption? This is partly true: the movement
for the Right to Information (which culminated in a law) does reflect
to some extent the social mobilisation and citizens' awareness necessary
in mature democracies.
But this does not explain the recent eruption of either the problem of
corruption or the social reaction to it. All indicators suggest that economic
illegality, fraud and corrupt practices have ballooned in recent times
in India. Increasingly, this is felt as a great betrayal by a populace
that had been told that the era of neoliberal economic policies would
end vices that were supposedly associated with greater government involvement
in economic activity.
Scams and scandals have become a staple of the economic environment. The
numbers keep growing, as hundreds of billions of rupees are extracted
in various ways: through government spending on mega-projects or big events
(such as the recent Commonwealth Games in Delhi); through often illegal
and inadequately compensated expropriation of land to benefit large private
players (for industries and real estate projects); through the gratuitous
takeover and handing to favoured parties resources ranging from water
and minerals to spectrum (the allocation of which was at the centre of
one recent high-profile scam).
One reason for the public anger is that the period of market-oriented
reforms has delivered higher aggregate growth but also significantly increased
economic inequality and material insecurity for the majority of India's
population. As the elites and burgeoning middle classes become more confident,
they become more brazen in flaunting their consumption to a population
that is generally denied any such access and may even be facing worsening
prospects. So the collusion between economic power and political/bureaucratic
power that leads to the rapid enrichment of a few is resented even more.
Many recent analyses of such corruption have seen it as a brake on India's
growth potential. In fact, however, such graft and the "crony capitalism"
associated with it have been an integral part of India's growth trajectory.
The last two decades have seen strongly "corporate-led" growth,
with huge rises in the ratio of profits and interest to GDP. Much of this
is related to what Marx called "primitive accumulation" – the
use of extra-economic means to extract resources and surpluses. The Indian
state has played a crucial role in this.
The animal spirits of entrepreneurs tend to be unleashed by such avenues
of surplus generation, and this contributes to buoyant economic growth.
But this is raw, wild west-style economic dynamism – unfettered by adherence
to any rule of law that treats all citizens as equal, and reliant on close
relations between capital and the state to ensure high levels of surplus
extraction.
The extreme dependence of large corporate capital on these relations,
and therefore the extent to which they are deeply implicated in the corruption
that they openly deplore, is usually missed by observers. Most of the
media and even the citizens' movements against corruption add to the obfuscation,
by presenting the problem solely in terms of the corrupt behaviour of
politicians.
Consider the two protests that are currently exercising the media and
the government in Delhi. One of them is led by Anna Hazare, a self-styled
Gandhian social worker with some success in water harvesting and other
development activities in his village of Ralegan Siddhi, in Maharashtra.
He combines personal integrity with a puritanical, and even slightly authoritarian,
streak. Hazare went on a fast to demand (eventually conceded by the government)
to be part of a panel to draft a bill for a public auditor to monitor
the activities of top officials.
Hazare's associates pride themselves on being "apolitical" (as
if that itself were a badge of honour), and persist in seeing the problem
entirely in terms of the government – politicians and bureaucrats – without
noting the connection with corporate power. Their demand for yet another
law conveniently ignores the point that the lack of genuine implementation
of existing laws is often the most obvious way in which corruption occurs.
Recently, another figure has emerged. Baba "Swami" Ramdev is
an entrepreneurial yoga instructor who has built up a significant business
empire based on yoga camps, traditional medicines and TV channels. Unlike
Hazare, Ramdev openly declares political ambitions and plans to float
a political party, and he has a large mass following. Many businessmen
and bureaucrats are also impressed with his skills, despite his often
socially reactionary views.
The central government behaved in an extraordinary fashion with Ramdev.
First, they greatly elevated both him and his demands by sending four
senior cabinet ministers to meet him at Delhi airport and whisk him off
for private talks. Then – when this did not succeed – within two days
they sent riot police to break up his peaceful camp of tens of thousands
of followers, injuring women and children.
Such peculiar and often contradictory responses of the central government
have been attributed to the possibility that senior figures in the administration
and the ruling Congress party are deeply involved in many scandals and
is reportedly stashing "black money" in accounts abroad.
But it might be that these strange responses reflect a deeper and genuine
dilemma. Perhaps the government knows something that is not yet explicitly
recognised in the media: that the Indian growth story has been reliant
on corruption, and that reining this in will also rein in the extravagant
growth that has become so necessary not just for the survival of the government
but for the self-image of the country's elites.
http://www.guardian.co.uk/global-development/poverty-matters/2011/jun/17/india-anger-over-corruption