India was born in 1947, when British India was divided into Pakistan and India on religious basis, Pakistan for Muslims and India for Hindus. The Political leaders of that time called it Democratic Republic of India, that is Bharat, and Islamic Republic of Pakistan. General Public of that time called it Hindustan (Land of Hindus; Hindu Rashtra) and Pakistan (Land of Muslims; Muslim Vatan).

The Laws of British India continued in both parts of the divided British India.

The levels of corruption soon surpassed in both parts the levels of corruption of British India.

What is corruption?

Interestingly, there is no definition of corruption available even in documents of United Nations which has been carrying on initiatives against corruption through United Nations development Program since 1965. Those agencies only talk of forms of corruption and not its definition.

Once, when I was Director, IIM Indore, I was invited to address officers of Central Bureau of Investigation (CBI) on International anti- corruption day, which falls on December 9, each year.

Being a Professor of Management, at core, I decided to search for an internationally  accepted definition of corruption. Definition always helps to delimit a problem and identify its solution, because the solution of every problem is embedded in the statement of the problem itself.

In the absence of any definition, I devised a definition. And to devise a definition, I used an analogy. I said, when a CD is muddled, what do you call it? You say this CD is corrupted. It is called corrupt because it doesn’t do what it is expected to do. So,  a working definition of corruption, I may propose is that corruption means when you don’t do what you are expected to do.

Any employee in any organization is handed over a letter of appointment before joining. That is a statement of expectations of an organization from that employee. So, when you don’t meet those expectations, you are corrupt.

Similarly, when you form a business or NGO, you write its mission, vision and values. When you breach those mission, vision and values, you are corrupt.

By those standards, India is full of corruption. In management literature, we call it  a problem of mismanagement of goal congruity. Corruption is not a  social evil. Goal congruity in simple words means congruity or matching or gelling of personal goals of employees and corporate goals.

The solution to corruption lies in the fact that we meet expectations from us, our commitments.

So, when a political party does not meet or exceed the terms of its political manifesto, they are corrupt.

The arrest of Arvind Kejriwal, Chief Minister of Delhi on March 21, 2024, has once again brought these questions and concerns to the fore; more so that Kejriwal had gained power on the planks of opposition to corruption rampant in Congress rule.

One of the leaders of AAP had gone on Indian TV channels on March 22, 2024, and had said that ED is using Prevention of Money Laundering Act, where chance of bail is hardly any.

Good for India!

That is New India.

I am almost as old as the Democratic Republic of India. I am son of a refugee of partition of British India in 1947. I have seen India changing and the New India now emerging where laws are being implemented.

According to Transparency International Report (Corruption Perception Index), India has been ranked highly corrupt country, year after year. It hurts you as an honest citizen of India.(but then you may be given a look, honest in India?; must not have got a  chance really; but there are still quite a few honest in India and relatively speaking, perhaps  a higher percent  compared to in countries ranked lesser corrupt on Transparency International Report; please note Transparency International publishes PERCEPTION Index only; if a corrupt classifies himself/ herself as corrupt, he/ she is honest and transparent though corrupt).

My father used to tell how corruption was encouraged in India in early years of political Independence. He used to relate that when Nehru, the then Prime Minister of India,  was complained that Kairon the then Chief Minister of Punjab was corrupt, Nehru said, no problem, money is not going out of the country.

That required  a law like the Prevention of Money laundering Act, but that came in the country in 2002. A celebrated lawyer and leader of Congress the other day was mocking Prevention of Money laundering law by saying you have heard enough about washing machines.

What is the Prevention of Money laundering Law?

It is a criminal law enacted to prevent money laundering and to provide for confiscation of property derived from, or involved in, money-laundering and for matters connected therewith or incidental thereto. ED has been given the responsibility to enforce the provisions of the PMLA by conducting investigation to trace the assets derived from proceeds of crime, to provisionally attach the property and to ensure prosecution of the offenders and confiscation of the property by the Special court.(

Money Laundering is essentially an action of showing dirty money, which is money received through illegal and criminal means and activities, as if received through legal means and activities. It is done through placing, layering or integration and extraction. The best thing about anti- money laundering law is that a person in possession of dirty money or assets created with that money is considered a criminal.

India has been infamous for corruption despite having such laws against money laundering because the laws were not sincerely implemented. That is the difference you now see in India. Modi committed to eradicating corruption (with Modi Ki Guarantee).

As noted above Arvind Kejriwal had come to power on the same plank of eradicating corruption. But Gandhi ji had rightly opined, human beings are either good or bad, they are not partly good and partly bad.

Kejriwal proved that. He came to power to eradicate corruption of Congress rule and then formed a coalition with Congress to be the Chief Minister of Delhi and is now in coalition with congress for 2024 elections. How unprincipled he is, do we need say more?

What is ED?

ED is currently under much attack from supporters of persons against whom action is being taken to check corruption in India. ED, that is Directorate of Enforcement under Department of Revenue, Ministry of Finance, Government of India, is a multi-disciplinary organization mandated with investigation of offence of money laundering and violations of foreign exchange laws.

Why It is difficult to get bail for an accused of Money laundering?

Money matters have quantitative, concrete facts and identifiable trails. I have seen people terminated (eased out) for misuse of Leave Travel Concession in India

Let me close with three nuggets of real-life experience:

Anti- Money laundering laws have been framed world-wide since 1965 and this law is stringent, without exception.

I had  a relative. He was Station house officer in rural India. I asked him between two parties to a dispute, how do you decide who should be arrested. His answer was: Who has a bigger army of supporters! Honest and poor people don’t get supporters to the police station.

A hotel owner, person of Indian origin, approached me for broker opinion of value (BOV) for sale of his hotel in USA. I said please provide me the relevant financial numbers like Income Statement and Seller’s Discretionary Earnings (SDE). He said, sorry, I don’t have. I said, sorry, I can’t then provide BOV. He said, “I want you to find me someone like Kejriwal.” I was quite surprised that the reputation had travelled beyond the Atlantic.

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