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Updated: April 11, 2013 04:47 IST
Kissinger Cables

Corruption in India a ‘fact of life’, say U.S. diplomats

P. J. George
Comment (22)   ·   print   ·   T  T  

“American interference” was the political catchphrase of the 1970s. With Indira Gandhi’s claims of a “foreign hand” and allegations of CIA-funding against her, it was easy to believe that a vast American conspiracy was active backstage to the great Indian tamasha.

But the Americans themselves saw a different villain, according to a U.S diplomatic cable sent from New Delhi during that period: “India’s ‘united givers fund,’ the Congress party.”

Its “collectors” — sometimes “politicians themselves, sometimes a ‘bagman’ for the party, sometimes, most recently, eve[n] a bureaucrat” — approach large and small firms alike, says the cable, accessed and released online by WikiLeaks.

It is in this July 7, 1976 communication (1976NEWDE09954_b, Secret) that the Americans first reveal that Sanjay Gandhi’s Maruti was seeking to be an agent for the British Aircraft Corporation, as already reported by The Hindu.

The cable was a response to a State Department request for a comprehensive assessment of India’s anti-corruption laws as inputs into a U.S. plan then for an “international agreement on illicit payments.”

But, the Embassy wrote, such a “comprehensive inventory may give the misleading impression that corruption/illegal payments are well under control in India.”

In fact, as the cable put it, the Indian experience had led the Embassy to the “cynical conclusion” that in India “there is a direct and positive relationship between laws against corruption and the extent of corruption itself, i.e., each such law only means that there are more people to bribe.”

The communication dismisses with disdain the “anglo-saxon legalistic” mindsets back home in the U.S that won’t understand the “cultural/political/economic fact of life” that was corruption in India, and sounds almost respectful of the discerning Indian who distinguishes “between corruption for political purposes and that for personal purposes.”

“It is more acceptable to take money for the Congess [sic] party than for one’s own personal comfort. While it is illegal for a corporation to make a contribution to a political party it is perfectly legal for the same corporation to make an equal payment to the Prime Minister’s relief fund or other organization which essentially serve the same purpose. It is legal to purchase advertising in party publications whether or not they are ever published.”

And then there are the acceptable levels and modes of corruption. “‘Speed money’, a small payment required to move papers, secure admission to a hospital, obtain a train ticket, etc. This is illegal but not considered corrupt since it is supposed to balance the niggardly income normally given to recipients of such payments. Similarly, nepotism, whether it benefits one’s family, caste or language or regional group is considered acceptable.”

The embassy acknowledges that “for the anglo saxon mind and the treasurer of a multinational corporation these distinctions are important” but “to the Indian realist they are sophistries.”

Of course, there is the occasional backfiring. “An Indian manufacturer paid a substantial bribe to the minister of civil aviation for a particular contract.” However, “the project became a source of controversy for reasons which had nothing to do with the bribe. The minister sought to return the bribe but the donor insisted on interest.” Finally, “a compromise was reached whereby an additional contract was awarded [to] the manufacturer.”

The ‘innovative’ Indian method of awarding contracts to the favoured bidder is explained in the words of a World Bank official “with extensive experience in India.” He “had never seen a case where an original low bidder ever received a contract” since “repeated tenderings combined with specification changes are instituted by the GoI until the appropriate bidder becomes low bidder as well.”

The examples of corruption coincide with the Emergency, still fondly recollected by some as when government offices actually worked and the babus flinched on being offered bribes. The embassy finds no evidence that corruption levels came down during this period.

As a prelude to this assessment, the embassy acknowledges the impossibility of putting the “extent and modalities of corruption in India” in one message. It also adds that “corruption is not a phenomenon which was brought to India by the West” since various kinds of corruption and corresponding punishments are prescribed by Kautilya in Arthashastra.

However, it does acknowledge that “the foreigner is an active participant in this form of activity, and in many ways is a preferred player.” The ace up his sleeve is, of course, “foreign resources.” “A contribution of foreign exchange in a foreign bank account is of high value and normally accompanies any major international transaction.”

In view of all this, the embassy’s suggestion to the State Department on the international agreement on illicit payments is that if “such a code ... is passed, US firms in India would probably lose some business while India goes on as before.”

Correction. Corruption is the very essence of life in India ! As long as we have the Govt breathing down our neckes at all times, interfering in every walk of life, binding us with myriads of complicated legislations, giving plenty of "discretions" to the Govt officials, corruption can never be brought down. It is our Government which seeds, nurtures and grows corruption.

from:  V. VEDAGIRI
Posted on: Apr 12, 2013 at 11:53 IST

Money is a byproduct. A corrupt country is uncivilised. Where people in nation resort to corruption, and governments (highest level of governance) use it instead of righteous laws, that nation is bound to break apart if not but land then certainly by its structure, while it takes steps ardently away from enlightenment that its people were shown, and instructed by the early gods when man was a creature. It is a evolutionary regression.
It's nothing to be proud of. It's so shameful that it puts one amongst dogs in the league of highly civilised humanity.

from:  Vick
Posted on: Apr 12, 2013 at 09:11 IST

Basic cause of corruption is our work-culture. We do not appreciate a person who works honestly. Money is the sole driving force in life. Despite,our ostensible spiritual values, an average Indian,is more material-minded. Leaders everywhere woefully are not role-models,inspiring values. Emerson,said: Without a rich heart,wealth is an ugly beggar. We lack that"rich" heart in our relations

from:  G.Narayanaswamy
Posted on: Apr 12, 2013 at 09:01 IST

Whether we like it or not, people like me who have seen life in the 50's
onwards, quite clearly recall how corruption has exponentially grown
from 70's.Though what the Embassy cabled to USA was well known as
clearly as one's own palm, its gigantic proportion as seen now,
bewilders and causes very great worry on what is in store for this
country in the future.Corruption has a major portion in today's high
cost of living.

from:  SARANATHAN
Posted on: Apr 11, 2013 at 17:12 IST

As matters stand, after decades of 'refinement', it is corruption that runs India; without it, there'd be anarchy. And this should be on no surprise to anyone. After all, it is because we are flexible with our principles and morals, that we are in this situation today.

from:  Sridhar S
Posted on: Apr 11, 2013 at 17:03 IST

Indira Gandhi was the original Iron Lady - not Golda Meier or Margaret
Thatcher. If she were to have been a dictator, especially as the Western
media liked to prortray her at the time, she wouldn't have held
elections and given up her post. She was right about the US-CIA
conspiracy ..... valid to this day !

from:  Rajan Mahadevan
Posted on: Apr 11, 2013 at 16:36 IST

The developed countries have understood how to manipulate the system in India. The comments of the diplomats are true and do not show the Congress in a good light to say the least

from:  krishna
Posted on: Apr 11, 2013 at 16:17 IST

I was waved down by a cop in Kochi,one afternoon.He'd spotted me
dropping my mobile inside the car,as I drove towards him.As I had
indeed picked up my mobile to check the calling number,it was
pointless arguing that I'd not answered the call!Friends berated me-a
quick apology&a Rs100 tip-cleverly rolled up inside the palm-would
have helped save the idiotic effort(Rs 150 for fuel from home to
Traffic HQ and back&Rs10 parking)to pay the fine.Come to think of
it,is it any wonder Aam Admi Party has few subscribers,even from Rural
India?Has Anna lost his touch,or was it a storm-in-a-tea-cup that he
whipped-up earlier,in a country thats back to the karma of paying the
peon,the compounder,the RTO agent,the document writer"Saar,the new
sub-Registrar is very strict!0.5% is very low"!Every rule of law adds
to bribe way-points.Time we legitimized it,by naming
it'ServiceCharges'&Taxing it,too.The Govt reduces
deficit,'facilitators'stop worrying about ACB raids&citizens get work
done.ALEX Bangalore

from:  Alex Thomas
Posted on: Apr 11, 2013 at 12:28 IST

Corruption has eventually become part of Indian economy. Now to reduce it would
counter the interests of the elite and ruling. All except the poor, middle class and needy
benifit from it and take it for granted.
Worst hit are natural resources, education, health industry, infrastructure.
One hope is use of technology, and people -AAP and such organisations.
Lets see what we see after twenty years.
I am hopeful, we will be better.

from:  Naja
Posted on: Apr 11, 2013 at 11:56 IST

@Manoj, History is essential and necessary, especially now, to learn
from our past mistakes and inspire from past glories. The lesson from
these cables is how ignorant the then generation about the wild-
spread corruption by the then Government or they had accepted it as a
way of life in India. If one can compare, it still stays the same,
which means nothing effective has been done by the successive
Governments to counter the same.
Since Centuries, this political nexus and nepotism has been there and
it has gained much rampant off late. Corruption, once was a top-down
thing and now, the bottom-up approach too trying hard.

from:  Rajshekhar R K
Posted on: Apr 11, 2013 at 11:42 IST

During Emergency corruption did not decrease contrary to claims by INdira- apologists.
Some of the non-congress parties also thrived on corruption.
In fact they took part in coalition govt.s in centre to have a larger share in the loot.eg,
2Gscam

from:  SSundar
Posted on: Apr 11, 2013 at 11:34 IST

We keep hearing from Jingoistic people that want to sweep bad news under the carpet that this is "our culture". All culture is not equal and this argument has no legitimacy. There is bad culture and if it has debilitating effect on the population, it has to be condemned and abandoned. Calling "part and parcel" of life feeds into such bad culture. Why do we pursue it? Another bad culture is the tithes and prayers - really bribes- to millions of gods and goddesses to have our wishes fulfilled. Has it worked?

from:  sathyavrath
Posted on: Apr 11, 2013 at 11:18 IST

Root of corruption is certain ruling elite take it upon themselves the right to loot the dues of poor, ignorant & marginalized.

from:  Anish Khindri
Posted on: Apr 11, 2013 at 10:51 IST

It is absolutely hilarious that the biggest rogue country in the world
is calling India a corrupted country. Bank of America and AIG have
billion dollar bailouts and they paid zero taxes for the last 3
years.Monsanto and other corporations have lobbyists that pay the US
congress millions of dollars so that they can have bills passed in the
Senate for their favor.Pot calling the kettle black ?????

from:  Prasad
Posted on: Apr 11, 2013 at 10:08 IST

The saddest part here is - the situation remains the same 40 years since their observation. "speed money’, a small payment required to move papers, secure admission to a hospital, obtain a train ticket, etc. This is illegal but not considered corrupt since it is supposed to balance the niggardly income normally given to recipients of such payments. Similarly, nepotism, whether it benefits one’s family, caste or language or regional group is considered acceptable.”

from:  Venkat
Posted on: Apr 11, 2013 at 09:36 IST

Hence proves the legitimacy of Wikileaks. It is known fact that Indians
are highly corrupted, which has to be more seen as a life style.
Corruption is a problem for someone only when he has no benefit in the
process.

from:  Aswin
Posted on: Apr 11, 2013 at 08:21 IST

cool, seems to be somewhat a true picture of vibrant india

from:  mohan
Posted on: Apr 11, 2013 at 08:15 IST

The pepole of this country through the last many decades continued to back the party of Gandhi and Nehru and largely believed that Nehru's decendents have a right to rule this country and they will not ever support corruption The non=Congress governments which came to power during this period were considered just aberations. We,the people of this country, should bear responsibility for allowing all this to happen. We have to become more politically discerning.

from:  K.Vijayakumar
Posted on: Apr 11, 2013 at 07:30 IST

Corruption in India a part and parcel of life.

from:  kumar
Posted on: Apr 11, 2013 at 06:34 IST

Not sure anyone noticed this but these are cables from 197o's... when most of us were not yet born or still in school. How many in the current generation know who Sanjay Gandhi, Henry Kissinger or Indira Gandhi were and what difference do their statements make today? The world has changed a lot between these years. The old assessments do not have any relevance in the present world. Dont waste so much space on these 'antique' news items.

from:  Manoj
Posted on: Apr 11, 2013 at 05:52 IST

Yes it it is a same story of the past and I don't give a damn.

But the shameful thing is that even after these many years, the
situation is the same or even worse.

I don't know where our country is heading and it largely is decided by
one family....

from:  Neelesh
Posted on: Apr 11, 2013 at 04:42 IST

Racial Discrimination in US is also a fact of life.

from:  Shyam
Posted on: Apr 11, 2013 at 03:25 IST
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