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Archive for April, 2011

Decoding India’s Corruption Wars

A shorter version of this appeared in the Business Standard


Nowadays, I find my mind turning to memories of a granduncle. He was over six feet tall, had a booming voice and by the time I was ten was already in his 70’s and retired from the British Raj government as a head constable of police. He went for his evening walk carrying a lathi-like stick and had an imposing presence; I could imagine him quelling prospective independence ‘agitators’ with just a look in their direction Of an evening he would turn into our gate, seat himself on our verandah, take a sip of  tea, lean back on his chair and declare, “This country is so corrupt! It is going to the dogs!” This was usually followed by a passionate recounting of the latest misdemeanour in the municipal corporation of Cannanore, that little town in Kerala where I grew up. My mother, who no doubt had heard this diatribe before, would continue knitting scarcely offering a comment. 

        You can see why my mind, nowadays, wanders to thoughts of my early childhood and of my retired granduncle. Judges, ministers, members of parliament, civil servants, businessmen, NGOs, investigative agencies, sports bodies, media personalities, all hurl accusations of corruption at each other. Everyone seems to be saying what my grand uncle used to tell us fifty years ago: “This country is so corrupt; it is going to the dogs!” 

        Maybe it is time we turn to Mark Granovetter, the Stanford University sociologist, who in his book, The Social Construction of Corruption, points out that cries of corruption often hide power struggles and that groups with conflicting interests will present standards that label their own  behaviour as appropriate and label behaviour that benefits competing groups as illegitimate or ‘corrupt’.

         One such social group that is in the thick of today’s corruption wars and  labelling exercises is one  that  Leela Fernandez of the University of Minnesota calls the New Middle Class. This group, she says, in her book, India’s New Middle Class, Democratic Politics in an Era of Economic Reform is not merely  defined by   income  or occupation or even caste. It  descends from the groups in India that embraced English-language education  and found employment in the colonial state in the modern professions such as  medicine, law,  the military and the civil service and has dominated Indian public life because of the cultural capital it possesses. This  cultural capital is then maintained  by their privileged access to the few good quality English medium schools that exist in India today and as a consequence to  those few high quality higher education institutions that act as gatekeepers to jobs in the higher civil service,  in public and private sector management, and professional jobs in the media, financial services,  law, medicine and teaching. 

        This cosy arrangement is being threatened, starting from the mid-1960’s, as democracy in India deepens.  

        The Congress party, from its founding in 1885 till well into the Independence era, maintained its power by enlisting a combination of the English-educated middle class and well-to-do landowners. The English-educated middle class through their cultural capital maintained a monopoly of the civic discourse and controlled the definition of the public interest and the land-owners brought with them the control of the patron networks they commanded in rural India as described by Lloyd and Suzanne Rudolph in their 1967 book, The Modernity of Tradition.

        The first blow was struck when social reform movements in the South in the 1920’s dismantled the vertical structure the land-owners controlled. The rise of the Dravida Munnetra Kazhagam in Tamil Nadu and the Communist Party of India in Kerala were early examples where small peasant and artisan groups adopted English education and learnt how to compete for political office. 

The next blow was struck when land reforms in the 1960s broke up large estates   all over India. Small peasants and artisans, who were the beneficiaries of this land reform, quickly acquired the economic capital first and then learnt to use their numbers in the electoral lists to convert this to political capital. Marguerite Robinson’s Local Politics, the Law of the Fishes describes this for Andhra Pradesh; Oliver Mendelsohn’s The Transformation of Authority in Rural India, describes this for Uttar Pradesh, Bihar and Rajasthan; Jan Bremen’s Footloose Labour, for Gujarat.

        Lucia Michelutti of the London School of Economics sees this as a deepening of Indian democracy. ‘New idioms about respectability and authority are developing on the ground’, she says in her 2008 book, The Vernacularisation of Indian Democracy. In her interviews in Mathura, UP, many respondents expressed admiration for leaders with a ‘goonda look’, a strong muscular physique, a leather jacket even in 45 degree heat, sunglasses, a powerful motorbike, all used to convey a cool, successful image and says that such ‘goonda’ qualities and skills are considered attractive characteristics and almost a necessity for a leader who operates in contemporary urban North India’. 

        She describes how poverty, illiteracy, a disregard for law and order and political violence co-exists with a commitment to the idea of democracy among the poor in North India.  Democracy has been vernacularized!

        The New Middle Class has retaliated by waging a subtle war to label elected representatives and politicians as corrupt. The battle ground for this war is the English-language print and TV media which reaches a miniscule 25 million people in India while  the vast Indian language print media with 170 million readers and the Indian language television with 300 million viewers remain largely unconcerned. However this tiny English-language media audience supports, nearly Rs 10,000 crores , or 50% of all advertising revenue. Winning the hearts and minds of this audience is crucial for media owners.

         NGOs,  the praetorian guard of the New Middle Class, is at the forefront of such labelling exercises. The current NGO demand for a Lok Pal,   uses the corruption platform , but its real goal is to give the New Middle Class leverage over elected representatives of the people. In an earlier move, NGOs pressurized the Election Commission to require candidates for electoral office to file affidavits listing  ‘criminal charges’  against them. Most  ‘charges’ are for things like  ‘unlawful assembly’ but this move has not only  created an incentive in the rough and tumble Indian electoral scene for political rivals to trump up ‘charges’ against each other but also   label politicians as criminal and corrupt. This is  unfair because  a person is innocent unless proven guilty. Affidavits ought to be necessary only if charges against a candidate have been proven in court.

        Much of the discourse about corruption in modern India is framed by the work of the Santhanam Commission of the early 1960s and two key institutions that we have today for preventing and investigating corruption, the Central Vigilance Commission (CVC) and the Central Bureau of Investigation (CBI) were created based on this Commission’s recommendation.

        ‘Corruption can exist only if there is someone willing to corrupt and capable of corrupting,’ said Santhanam. ‘We regret to say that both this willingness and capacity to corrupt is found in large measure in the industrial and commercial classes.’

        For Santhanam, the villains were the ‘industrial and commercial classes’ from who the newly created public enterprises had to be protected.

        This is the reason why it proposed a Central Vigilance Commission supervising an army of Vigilance Officers posted in all public and quasi-public undertakings. It also proposed a Central Bureau of Investigation to look into such cases. All of the prejudices and hopes of 1960s India are embedded in these words of the Santhanam Commission demonizing ‘the industrial and commercial classes’ and in the architecture of the recommendations. It is no surprise then that the Federation of Indian Chambers of Commerce and Industry, FICCI, refused to provide testimony before the Santhanam Commission. FICCI represented, after all, the very ‘industrial and commercial classes” that the Commission inveighed against.

        The Santhanam Commission constructed corruption as essentially arising from the depredations of the ‘industrial and commercial classes’. The modus operandi of these classes, it felt, was one of subverting the working of the newly created State enterprises. Viewing the same issues in today’s light we are more likely to attribute this form of corruption as arising from the License Raj and excessive domination of the economy by the State. We may merely propose that the License Raj be abolished.

        The Committee added two more elements to its construction of corruption that haunt us to this day.

        The first element was how the term ‘public servant’ was defined. The Indian definition is very different from the definition in advanced industrial economies. In those economies, ‘public servants’ are only those civil servants who are directly employed by the State. In India it was defined very widely and includes ‘any person required performing a public duty’ and ‘public duty’ is defined equally broadly: Essentially any duty that ‘the public at large has an interest in.’ 

This includes obvious government functionaries like ministers of the central and state governments and bureaucrats and sarpanches in villages. It also includes judges in courts, employees of nationalized banks and insurance companies, officers of railways and state transport corporations, teachers in schools and colleges that accept any modicum of government financial support. 

        This wide definition today includes possibly 25 million people, making the task of vigilance and anti-corruption immense.

        The second element was that it has constructed corruption as a criminal offence instead of a combination of criminal and civil offences. Criminal offences are much more difficult to prove in court because the standards of proof for them are much higher. For example, to secure a criminal conviction for corruption, investigators have to actually trap public servants in the act of receiving money. 

        On top of this, Indian courts, consistent with our view of a democratic polity, have prescribed elaborate safeguards for ‘trapping’ public servants in the act of receiving bribes. The end result, because of these and related reasons, is that corruption charges take years, if ever, to be proven. And even if criminal charges are proven, there is no easy way to make a corrupt public servant give up the fruits of his ill-gotten gain because present Indian law makes it difficult to attach property that is bought with proceeds of a corrupt act and held in the names of close relatives, (so-called ‘benami’ transactions). 

        One of the foremost ‘labellers’ of corruption in our time is Transparency International. This Berlin-based non-governmental organization publishes a widely followed annual ranking of countries that it calls The Corruption Perception Index. The 2010 edition puts Denmark at the top, i.e., the least corrupt country in the world and puts Somalia at the bottom of the 178 countries ranked, as the most corrupt country in the world.

        India is at 87, roughly in the middle, behind our sibling rival, China, at 78. Mexico is at 98, behind us and so is Argentina at 105. The higher echelons of the list are usually occupied by small European countries like Denmark, Finland, Sweden and Netherlands and by small island nations like Hong Kong and Singapore. Germany, at 15 leads the larger nations ahead of UK at 20 and the United States at 22.

        Egypt, where the ruling Mubarak clan has been recently driven out of office amidst allegations of massive corruption is at about the same level as India.

Switzerland, a country that is usually implicated in most corruption scandals is at a lofty 8th rank, raising the first eyebrow about what exactly is being measured by this index.

        Transparency International’s Index, is in essence, an opinion poll of mostly Western businessmen though, in recent years, respondents in target countries have also been included. Respondents are asked questions such as , “Do you trust the government?” and “Is corruption a big problem in your country?”, questions which sound perfectly fine, until we realize that the word ‘corruption’ packs into itself a wide range of meanings and feelings of dissatisfaction which may have little to do with financial wrongdoing per se.

        The origin of Transparency International and much of the international brouhaha about corruption harks  back to the Watergate scandals of the mid-1970’s in the United States. Congressional investigators, tracing the flow of illegal campaign contributions,  stumbled on the fact  that as many as 400 American companies had resorted to a range of questionable payments including bribery of high foreign officials, making ‘facilitating payments’ to them  and even payments to get favourable tax treatment. In the climate of moral outrage of that time, the US congress enacted, in 1977, the Foreign Corrupt Practices Act prescribing strict criminal and financial penalties for such actions by US companies. 

        This remained the only law trying to deal with transnational corruption till US companies began protesting that this law put US companies at a competitive disadvantage against their European competitors who were not only free to pay bribes to foreign officials but could also claim income tax deductions for such payments!

        Intense pressure from US exporters led the OECD, a group of advanced economic countries, to adopt similar legislation criminalizing the bribery of foreign officials and removing tax deductions of these bribes.

        Transparency International was born out of these events. US AID was a generous early financier for the organization and during the period of intense lobbying by US firms to get OECD to adopt and ratify the ant-corruption convention, contributed a fourth of TI’s budget. According to Julie Bajollee of the French Corruption Research Network, Shell, the giant British oil company was another early financier and supported both the TI international secretariat in Berlin as well as its chapters in Bangladesh and Columbia and so have KPMG and Price Waterhouse, the big international accounting firms financed many country chapters.

        The CBI is frequently drawn into these battles but, as we have pointed out,  imperfections in Indian anti-corruption laws  makes it difficult for the CBI to convict  even  10%  of the people they bring charges against.  The CBI tries to compensate for this by staging photo-ops that show them  escorting away prominent personalities  misleading the public and labelling the people being led away as already guilty of corruption whereas what the CBI is doing is only seeking information about a possible crime. CBI and the media must be mandated to refer to all such people not as ‘accused’ but merely as ‘persons of interest’, as they increasingly do in the United States. 

        The judiciary is invoked from time to time by all combatants to referee their disputes but as Madhav Godbole, a former Home Secretary, points out in his recent book, The Judiciary and Governance in India, there are 16 million criminal cases pending in court and  proposals for speeding things up such as  increasing the number of working days in high courts from the present 210 per year to 260 are  opposed by Bar Associations.

        As democracy deepens, dramatic power shifts will continue to happen in Indian society and the Middle Class needs to accept that all such power shifts may not be in their favour. The Indian Middle Class sowed the wind of democracy and is now reaping its whirlwind.

        On a recent visit to Cannanore, that little town in Kerala where I was born, I strolled down one morning to the stretch of sand by the sea where tombstones of the town’s grandees stand cheek by jowl. I stood for a moment before my granduncle’s, and wondered how he would have responded if I had told him that his distress at corruption nearly fifty years ago was merely the sense of loss of a British Raj police head-constable regretting the passing of an era.

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Travels in Uzbekistan: Faizulla Khodjaev & the dilemma of leadership

It is hard to find a leader whose life exemplifies the dilemmas of leadership in a muslim-majority country more than that of Faizulla Khodjaev who was head of the Bukhara Socialist Republic from 1920-24. Bukhara, of course, is no longer an independent republic but part of the state of Uzbekistan.

As we pick up the action, Bukhara was an independent Emirate but had a Czarist Russian Agent overseeing matters much like the British Residents in Princely States in pre-independent India.

Khodjaev was the son of a well-to-do merchant in Bukhara and like scions of many wealthy families in the Bukhara of that time was sent to the Soviet Union and then Turkey for higher studies. In Turkey he came under the influence of the Young Turks movement, that restive group impatient with the old ways of the Emir-ruled states and wanting to bring them into the modern world.

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On his return to Bukhara in 1912 he founded a newspaper, ‘The Holy Bukhara’ which preached the need for democracy, secular education and such other modern ideas that were sweeping the world of that time. It is said that the ulema whispered into the Bukhara Emir’s ears asking whether the Emir had now embraced Christian ideas such as these and the emir panicked and ordered the newspaper shut after just 13 issues. The political movement he had co-founded, the Jadid, which among other things wanted a separation of the State and Religion, split into a conservative faction ready for a long and patient attempt to persuade the Emir to modernize and a radical faction, of course led by Khodjaev which wanted immediate action.

By then it was 1917 and Russian revolution shook the world, so Khodjaev and his radicals presented a plan to the Bolsheviks proposing radical modernization. With Russia’s support the plans were again presented to the Emir who had no choice but to accept it.. It is said that the Emir , after accepting the plan, encouraged the ulema to use their  reach to the masses through Friday prayers and the madrasas to oppose it. This set up clashes in the streets of Bokharo between the Ulema and the radical faction of the Jadid. The Emir used this excuse to arrest the radical faction leaders.

This made Khodjaev and his team decide that they had no choice but to ask the Emir to go if Bokharo was to modernize. This coincided with Lenin’s announcement that all former Russian colonies were free to go their own way and could even ask for the help of the Red Army to unseat the traditional emirs who ruled all over Central Asia.

Khodjaev and friends, in a move that he was to judge to be a tragic mistake later on, took this offer at face value and invited the Red Army’s help in unseating the Emir. This of course took no time since the Russian army was not only overwhelmingly powerful compared to the Emir’s one  but also because many basic utilities in Bokharo at that time including the railway system was run by Russia.

Khodjaev and his Russian allies quickly despatched the Emir, renamed his party the Communist Party of Bokhara and in 1920, as the First Secretary was effectively the head of the People’s Republic of Bokaro.Khodjaev promptly got down to modernize his state, opening schools to impart secular education, side-lining the Ulema, separating the State’s functions from religion.

The first sign of trouble for Khodjaev was when he tried to alter Bokaro’s role as the cotton plantation of the Soviet system. He pushed for a larger allocation of land and resources to food crops, famously telling Stalin that people cant eat cotton. It is said that Stalin viewed this as an expression of nationalism which ran counter to the views of the Communists at that time.

Ominously, in the 1937 election to the Party posts, Khodjaev’s name was not proposed. The next year, he was summoned to Moscow and after a brief trial was condemned to death for his anti-people attitude. He was promptly executed and his mother, wife and two daughters were packed off to Siberia to do hard labour from which only one daughter survived.

Khodjaev’s struggle to modernize his country makes a poignant tale. He was swimming against the many strong tides of his day: the rise of Communism, the social structure of the Central Asian emirates of that time with a tightly coupled relationship between the ulema and the Emir, a country which was a single-crop ( cotton) commodity producer vulnerable to fluctuating prices, the Great Depression of 1929, the formation of the Soviet Union in 1924 and the consequent isolation from world markets.

After Uzbekistan was set free from the Soviet Union in the early 1990’s, Khodjaev has been posthumously rehabilitated. There is a university now named after him and his ancestral home is a museum.

Yesterday we stopped by to see the museum and found that we were the only visitors there. Later in the day we visited the Emir’s ( yes, the same Emir who foiled Khodjaev’s modernization plan) summer palace , a scaled down version of the Czar’s in St Petersburg, which was flooded with peasants from Fargana, newly-weds on their first picnic etc.

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Running into the creator of the algorithm in Kiva

There aren’t that many places in the world as remote as Kiva in the Korezm province of Uzbekistan. Even from Taskent, the capital of Uzbekistan, you need to fly an hour and several hundred kilometres westward over desolate steppe to get there.

This is why I was astonished when on a morning stroll in Kiva on a recent holiday in Uzbekistan, I turned a random corner and what should I see but a giant statue of an old acquaintance, Abu Jafar Muhammad ibn Musa al-Khwarizmi.

For those of you who did not pay much attention to your high school history teacher, he is the man from whose name the mathematical term ‘algorithm’ is derived from. And again for those of you who have not been paying too much attention to what’s been going in the world of late, the algorithm is what drives, among other things, Search Engines, Social Networking sites and other marvels of our age.
The term ‘algorithm’ is the latinization of his name. ‘Al-Kwarizmi’ in Latin became ‘algorismi’ and from there ‘algorithm’. He worked in Baghad’s House of Wisdom at a time when wild beasts roamed the areas where Stanford, Harvard, Oxford, Cambridge and the Sorbonne now stand. His book, ‘On Calculation with Hindu Numerals’ (‘Kitab al-Gam? wa-al-tafriq bi-?isab al-Hind’), written in 825 was translated into Latin in the 12th century as ‘Algoritme de Numero Indorum’, literally, ‘Al-Khwarizmi on the Hindu Art of Reckoning’. This book introduced a decimal system of numbers composed of the numbers 1 to 9 and a 0 to the western world. His other book, ‘al-Kitab al-mukhta?ar fi ?isab al-jabr wa-l-muqabala’, is considered to be the foundational text on algebra, the word ‘algebra’ itself being a latinization of ‘al-jabr’

Al-Kwarizmi, means ‘from Kwarizm’ and Kwarizm is another way of spelling Korezm, the modern name of the Uzbekh province in which Kiva now stands.

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As I stood staring at my friend’s giant statue many questions swirled through my mind. Muhammad ibn Musa al-Khwarizmi is normally talked about as a Persian or from Baghdad, so why were the fair people of Kiva claiming him as one of their own? Even conceding that he was in Kiva in the years before he went to Baghdad, how on earth could he have, living in this remote part of the world, developed the skills required to even ask questions that could lead to the kind of answers that enrich his work?

One of the answers to this puzzle could be that this tiny town of Kiva with a population of about 3000 in Al-Kwarizmi’s time had half a dozen madrasas which is roughly the equivalent of New York City today having 67,000 colleges. So Kiva was clearly a university town in its time.  The educational programme in these madrasas at that time lasted three years and students had to study the Koran and related things for about 40% of the time, the rest of the time was spent in learning astronomy and mathematics. Each student was admitted based on the recommendation of a tutor. On admission each fresher was attached to a senior student and the pair, through discussion and debate, worked their way through the questions of the day. The final exam at the end of the three year stint had two parts to it. The first part was where four different tutors other than the one who recommended the student for admission quizzed him on all that he was supposed to learn. The second part was when the student had to tell the tutor who had admitted him, something that the tutor did not already know! Thus was the frontiers of knowledge pushed a little further by every student who attended a madrasa. The penalty for not coming up with an original thought was to repeat the three year program. It is said that some students spent their whole life trying to achieve a pass grade.

But how to explain how such frontier and research based education took place in this remote corner of the world?

The answer to this is that Kiva in the Al-Kwarizmi’s time, the 9th century AD, was, directly on the Silk Road, that vast international trade system which carried merchandize and ideas from producing centres such as India and China to consuming centres in Europe. In that sense Kiva was at the centre of the world of that time and open to the flow of ideas back and forth across the Silk Road.

How does a city which lives and prospers in the centre of the world become relegated to a corner of the world? The answer of course is that the centre can itself shift.  Christopher Beckwith, in his book ‘Empires of the Silk Road’, says that the discovery by Europeans of the direct sea route to India and China shifted trade almost completely away from the Silk Road.

The Europeans established an Asian Littoral zone attracting people, culture and technology to the port cities that they established and controlled throughout Asia. Even the Russian Empire, despite its control of vast swath of Central Eurasia, shifted its trade to sea from its capital St Petersburg in the Baltic to Vladivostok on the Sea of Japan. In short order, the Eurasian economy had changed from the continental-based Silk Road system to a coastal Littoral System. With this shift, says, Beckwith, ‘Central Eurasia disappeared’.

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