The report says that corruption may result in a volatile political and economic environment
Widespread corruption in India costs billions of dollars and threatens to derail the country's growth, a survey says.
The report by consultancy firm KMPG says that the problem has become so endemic that foreign investors are being deterred from the country.
It was compiled by questioning 100 top domestic and foreign businesses.
Its release comes as Prime Minister Manmohan Singh struggles to cope in the battle against corruption.
Earlier this month the head of the country's anti-corruption watchdog was forced to resign by the Supreme Court on the grounds that he himself faces corruption charges.
Over the last six months India has been hit by a series of corruption scandals including a multi-billion dollar telecoms scandal, alleged financial malpractices in connection with the Commonwealth Games and allegations that houses for war widows were diverted to civil servants.
"Today India is faced with a different kind of challenge," the report said.
"It is not about petty bribes (bakshish) any more, but scams to the tune of thousands of crores (billions of rupees) that highlight a political/industry nexus which, if not checked, could have a far reaching impact.
"Corruption poses a risk to India's projected 9% GDP growth and may result in a volatile political and economic environment."
Critics of the government say that recent scandals point to a pervasive culture of corruption in Mr Singh's administration - adding to the difficulties of a politician once seen as India's most honest.
The government denies the claims and has set up a parliamentary inquiry into corruption. A former cabinet minister is under arrest.
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