Monday, January 16, 2012

Corruption Mitigation and Good Governance - The Biggest Growth Engines for Indian Economy

The Indian dream of becoming an economic superpower and a prosperous nation appears to be a distinct reality in the light of government's compulsion to address the expectations of the masses and the compulsions of the advanced industrial nations of the world to move manufacturing bases to low wage economies with strengths of a broad based human resource and large captive markets. The resulting Indian growth story is here to stay for the next three decades provided the Indian governance can take care of the stumbling blocks in the path of this growth trajectory with correct policies, financial and administrative reforms, human resource development, massive up gradation of infrastructure and above all good governance.Out of this large wish list, Corruption Mitigation is perhaps potentially the biggest growth engine with a large weightage and can contribute 50% extra towards annual Indian budgets in the following manner.Corruption Mitigation and good governance are interdependent and measures like strict policing, quick judicial disposal of economic offences backed by corruption mitigating administrative reforms are the very backbone of this fight against corruption and black money.

  • The direct and indirect tax collections will increase by a minimum of 25% annually for the next twenty years.
  • The overall subsidy budget comprising of gas, oil, food etc can reduce by 50%.
  • Through the same annual budgetary allocations for infrastructure, an extra 25% infrastructure development can take place.
  • The annual maintenance cost allocations for infrastructural assets of the nation could be reduced by 90%.
  • The annual savings on petrol, diesel and repairs of vehicles could be as high as 25%.
This effort alone can catapult the Indian growth story potential into growth rates of low teens.We can only hope, wait and watch how the Indian polity puts into action corruption mitigation programs for which a lot of rhetoric has been raised by one and all of the Indian polity. On top of it India can manage to recover a substantial amount of black money stashed in foreign countries as well as in Indian households and businesses, the miracle of propelling India into the developed nations' club will be realised much sooner.