January 20, 2012

An analysis of India's pathetic 95th rank in the Corruption Index and its far reaching social impact!

Amongst the many critical predicaments that the Indian economy suffers from, corruption has been one of the biggest monsters, and thankfully the most talked about in recent days. Needless to say, corruption has corroded every delivery system and has made it completely dysfunctional. The entire Indian public life is riddled with overriding rates of corruption – from the Adarsh land scam to Commonwealth Games misappropriations to the 2G spectrum scam – the list here has been endless, and the magnitude, obscene. In fact, India’s public life was never clean – the infamous Bofors scandal, Harshad Mehta’s nexus with senior politicians and Ketan Parekh’s stock market manipulation – all had their own perilous impact on the economy! It requires no empirical study or statistical survey to exhibit that we comfortably are the top performers in all corruption related global indices.

Take for instance, Transparency International’s Corruption Perception Index (CPI) where India’s rank has been slipping consistently – languishing at the 95th position now with a score of 3.1 (on a scale of 10), a sizable 23 ranks down from 2007! We are far behind China that stands at 75th position with a score of 3.6. CPI score is not only about corruption but is more about the way corruption has got institutionalised in our system. Also, it is a fact that India’s score could have been better had it not been battered with the monstrous 2G spectrum scam. Interestingly, all the least corrupt countries like New Zealand, Denmark and Finland with 9.5, 9.4, and 9.4 scores respectively are not just socially developed but also economically progressive. And that’s why these are those nations that experience very few cases of crime, corruption and other forms of social malaise – unlike India.

The thumb-rule that set the pattern is that the developed countries mostly have high CPI scores, whereas at the bottom of the table are the countries mired by civil strife and oppressive regimes; and in-between are the emerging economies as well as former communist blocks. There is also a direct correlation between CPI rankings and Human Development Index (barring some aberration like Greece, which, in spite of being a developed country is ranked below China at number 80; and South Korea, which is ranked 12th in HDI and is 43 in CPI). Most of the African as well as Asian nations have a combination of low CPI and low HDI scores and most of the European and North American countries have the opposite; thus reflecting a direct bearing between the two indices! On hindsight, it may appear that there is no impact of corruption on GDP growth and investments. China and India, both scored quite low on CPI, yet have been riding on decent economic growth and FDI inflow. Vietnam and Indonesia are even lower in ranks in CPI (2.9 and 3.0 respectively) are recipient of quantum investments with their economy kicking!
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8 comments:

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Mohit rao said...

nice blog.....
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Mitesh said...

nice blog .
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payal said...

Corruption is common now bcoz at every level we get interact with it,the only way to eradicate this ,is to face d truth and accept that we also a part of it for our interest

pinkey said...

Rich people become more rich in India n poor people still face the hounds of poverty
because of our corrupted leader's

sonia said...

Nice Post... But who arise corruption simple we, if we will stop the corruption then automatically country will be grow!!!!!!!!!!!!!!!!!

Tarun said...

Any country can be free 4m evils like corruption only wen our leaders will lead the way so that common man can follow the path but its India's misfortune that here leaders r busy in making their own monetary profits this way or that way.

ahmedabadonnet said...

Good analysis...
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