Bgs: Corruption in India

Topics: Political corruption, India, Civil service Pages: 70 (26879 words) Published: October 2, 2012
Cause of black money: 325 Black money is cash received from underground economic activity or black market on which tax is not been paid to the government. Black money in economic terms is regarded as unaccounted money or unrecorded gains. Rationing system: Black economy originated in India during World War II when India was facing acute shortage of daily necessities. This was the time government adopted rationing as a remedy measure to resolve the demand supply mismatch. By rationing government introduced a system of control where prices of goods were no longer decided by Interaction of market demand and supply. This led to the beginning of unauthorized sale goods at higher price. This control over the price continued post 1947 promoting black marketing in India and once government institutionalized price control, it grew enormously. High tax rate- Tax rate were abnormally high during initial tax regime of India. Tax rate applicable to an individual were as high as 97.50%. Such high Tax rates probed individuals to evade tax as much as possible resulting in huge accumulation of Black Money. Complicated tax law- Tax Laws in India are so complicated that even honest tax payer fails to file correct Income Tax returns. This compels the individuals to evade tax to avoid long complicated procedures involved in paying tax. Bribe-- Bribe is one of the main source for generation of Black money as this money is not disclosed to Income tax office. Bribe is used as means to get work done at a faster pace by all kinds of people from peon of a company to the owner of a company and is used for all kinds of work i.e. from getting admission in school to getting a job in a company, from getting birth certificate of a new born baby to the pension of a retired person. Even Entertainment industry has leveraged the concept of bribe to make their scripts juicy, they have used this topic over and over to make famous movies and serials like movie “Kala Bajar” and serial “Office Office” since bribing is dirty yet common activity in day to day life of a common man. Travelling abroad-- Business men who intended to increase their business overseas or to import some technology for their business has to travel abroad. The permissible amount of foreign exchange that an individual could carry abroad was merely $500 which was suffice only to fulfil food and accommodation expense for a few days. Hence Indian Businessmen preferred to keep money abroad rather than carrying it from India to abroad. Cap on salary-- Government had capped the salary of top executives of big companies, as result of which a part of the salary was paid to them in form Cash (Unaccounted money). This further boosted the growth of Black economy in India. Political reasons-- Political parties use to receive Black money to fund their election expense and enhance their party funds. Illegal activities-- One of the major reasons behind rise black money is illegal activities like smuggling, drug peddling and prostitution.


What is corruption?--

Corruption is a way of life in India – “ When a Child is born, we

pay the nurse just something extra to take care of our baby more, when the Child goes to School, we pay that little extra (donation) to get hi, in, when the Child goes to College, we use connections to get him the best, when that Child grows up and gets a Car, he pays bribes to traffic personnel to get away from a parking ticket, later in life he uses his father’s connection to get a job, when he goes abroad he pays the agent extra to get his Visa/Passport done, And the Cycle begans again. What I didn’t bother to mention are the extras – the bribe to get the plot land, the permission to get the extra floor added to his dream house…… the list is endless. But what is so funny with Indian public is that this word “CORRUPTION” is something that in itself is so horrifying word. It is mention in hushed tones, and always directed at other. List of politician charged with...
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