2G Spectrum

The 2G spectrum scandal involved officials in the government of India illegally undercharging mobile telephony companies for frequency allocation licenses, which they would use to create 2G subscriptions for cell phones. The shortfall between the money collected and the money which the law mandated to be collected is estimated to be 176,645 crore (US$38.86 billion) as valued by Comptroller and Auditor General of India based on 3G and BWA spectrum auction prices which held in 2010. However the exact loss is disputed, Central Bureau of Investigation (CBI) pegged the loss at 30,984.55 crore (US$6.82 billion) in its first charge sheet filed on 2 April 2011, whereas Telecom Regulatory Authority of India in a response to CBI's query said that the Govt. has actually gained 3,000 crore (US$660 million) by selling the spectrum. Kapil Sibal, minister for communications & IT, said in a press conference that there was no loss caused by selling 2G licenses.

However in September 2011, CBI argued before the Supreme Court that it was unsafe to read a "no loss" conclusion in the telecom regulator's calculations on irregular spectrum allotment as the methodology adopted admittedly did not take into account the market mechanism. All the speculations of profit, loss and no-loss were put to rest when on 2 February 2012 the Supreme Court of India delivered judgement. The Supreme Court declared the allotment of spectrum as "unconstitutional and arbitrary" and quashed all the 122 licenses issued during tenure of A. Raja, the main accused in the 2G scam case. The court further said that A. Raja "wanted to favor some companies at the cost of the public exchequer" and "virtually gifted away important national asset".

The issuing of licenses occurred in 2008, but the scam came to public notice when the Indian Income Tax Department was investigating political lobbyist Nira Radia. The government's investigation and the government's reactions to the findings in the investigation were the subject of debate, as were the nature of the Indian media's reactions. Much of the credit of bringing this whole scam into the public light (by pursuing it in the court of law) goes to Subramanian Swamy who is the chief petitioner for this case in the court of law.

Background

India is divided into 22 telecoms zones and there are a total 281 zonal licences in the market. According to the telecom policy of India, when a licence is allotted to an operator some start-up spectrum is bundled along with it.] The policy does not have a provision for auctioning the spectrum In year 2008, 122 new second generation (2G) Universal Access Service (UAS) licenses were given to telecom companies at the price of 2001 and on first come first serve basis. As per the chargesheet filled by Central Bureau of Investigation (CBI) several rules were violated and bribes were paid to favour certain firms while awarding 2G spectrum licenses. The audit report of Comptroller and Auditor General of India (CAG) says that several licenses were issued to firms with no prior experience in the telecom sector or were ineligible or had suppressed relevant facts.

In August 2007, Telecom Regulatory Authority of India (TRAI) had given its recommendations which also included recommendations on pricing of 2G spectrum among many other recommendations to Department of Telecommunications (DOT), which is a part of Ministry of Communications and Information Technology, then headed by A. Raja but he did not place the recommendations before the full Telecom Commission which, among others, would have included the Finance Secretary. In 2007, Ministry of Law had written a letter to A. Raja advising him to refer the 2G spectrum allocation issue to the Empowered Group of Ministers (EGoM) but Raja rejected this advice and wrote a letter to the Prime Minister's Office terming the Law Ministry's advice as "out of context."

In November 2007 Prime Minister of India Dr Manmohan Singh too had written a letter to telecom minister A. Raja directing him to ensure allotment of 2G spectrum in a fair and transparent manner and to ensure license fee was properly revised. Raja wrote back to the Prime Minister rejecting many of his recommendations. In the same month Ministry of Finance wrote a letter to Department of Telecommunications (DOT) raising concerns over the procedure adopted by it[ but DOT went ahead with its plan of giving 2G licenses. It preponed the cut-off date to 25 September, from 1 October 2007. Later on the same day, DoT posted an announcement on its website saying those who apply between 3.30 and 4.30 pm on that very day would be issued licences in accordance with the said policy.

Companies like Unitech & Swan Telecom got licenses without any prior telecom experience. Swan Telecom got the license even though it did not meet eligibility criteria. Swan got license for 1,537 crore (US$338.14 million) and then it sold 45% stake to UAE based company Etisalat for 4,200 crore (US$924 million). Unitech Wireless, a subsidiary of the Unitech Group, got license for 1,661 crore (US$365.42 million) and later sold 60% stake for 6,200 crore (US$1.36 billion) to Norway based company Telenor. Following is the list of companies who got the 122 2G licenses during the tenure of A. Raja as Telecom Minister. The licenses were later quashed by Supreme Court)

Name of CompanyNumber

of license granted

Remarks

Adonis Projects Pvt. Ltd.

6 Adonis Projects,

Nahan Properties,

Aska Projects,

Volga Properties,

Azare Properties &

Hudson Properties were acquired by Unitech.

Unitech Infrastructure and Unitech Builders & Estates were already subsidiaries of Unitech Group. So in 2008 Unitech had 22 2G licenses. Later in the same year Norway based company Telenor bought majority stake in the

Nahan Properties Pvt. Ltd.

6

Aska Projects Ltd. 3

Volga Properties Pvt. Ltd.

3

Azure Properties Ltd.

1

Hudson Properties 1

Unitech Builders & Estates Pvt. Ltd.

1

Unitech Infrastructures Pvt. Ltd.

1

telecom company from the Unitech Group. Now it offers

Loop Telecom Pvt. Ltd.

21

Datacom Solutions Pvt. Ltd.

21 Operates under brand name Videocon Telecommunications Limited

Shyam Telelink Limited

17 Shyam Telelink Limited & Shyani Telelink Limited operate together with their combined 21 licenses. During late 2008 Russia based group Sistema bought majority stake in the telecom company and now they operate under brand name MTS India.

Shyani Telelink Limited

4

Swan Telecom Pvt. Ltd.

13 In 2008, Swan Telecom merged itself with Allianz Infratech (P) Ltd. During late 2008 Abu Dhabi's Etisalat bought about 45 percent of the company and renamed it to Etisalat DB Telecom

Allianz Infratech (P) Ltd.

2

Idea Cellular 9 Idea Cellular bought Spice Communications Ltd. in 2008 for an amount of 2,700 crore (US$594 million). So out of 122 spectrum licenses sold in 2008 Idea Cellular owns 13 licenses

Spice Communications Ltd.

4

S Tel 6

In January 2009, Bahrain Telecommunications signed a deal with S Tel to buy 49% shares in S Tel for $225 million. C Sivasankaran owns the remaining (51%) share.In May 2009, Sahara Group bought 11.7% stake in S Tel

Tata Teleservices 3

In late 2008 promoters of Tata Teleservices sold 26% equity stake to a Japanese telecom giant NTT Docomo for about 13,070 crore (US$2.88 billion) or an enterprise value of 50,269 crore (US$11.06 billion).

PARTIES ACCUSED

The selling of the licenses brought attention to three groups of entities – politicians and bureaucrats who had the authority to sell licenses, corporations who were buying the licenses and media professionals who mediated between the politicians and the corporations.

Politicians accused

Politicians named as accused in the chargesheet filed by CBI in the Special CBI Court ,allegations levelled against them by CBI and charges framed against them by the Special CBI court.

A. Raja :

Political career - Political party DMK

Allegation - In a joint investigation report prepared by Central Bureau of Investigation (CBI) and Enforcement Directorate (ED) the agencies allege that A.Raja could have received 3,000 crore (US$660 million) as bribe for bringing forward the cut-off date for applications for spectrum from the initial October 1, 2007 to September 25, 2007. The deadline switch eliminated many applications, enabling Raja to favour a few with spectrum.

The agencies also alleged that he used bank accounts under his wife's name in Mauritius and Seychelles to chanelise the kickbacks he received. In chargesheet filed by CBI it alleges that Raja conspired with the accused, subverted the first-come first-served (FCFS) policy and waywardly redefined it to ensure that Swan and Unitech got 2G licences. He didn’t auction the 2G spectrum or adopt some other market-determined methodology to determine its real valuation and instead benchmarked it to a rate discovered in 2001, when the telecom sector was at a nascent stage.

Charges

Criminal breach of trust by a public servant under section 409, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468

and 471 are booked under the Prevention of Corruption Act for accepting illegal gratification.

Status - Taken into custody (arrested) by CBI on 2 Februay 2011 and lodged in Tihar Jail since then (as of february 2012) Applied for bail a number of times but every time the bail got rejected.

M. K. Kanimozhi :

Political career - Daughter of 5 times Chief Minister of Tamil Nadu M. Karunanidhi. Political party DMK. She is an MP, representing Tamil Nadu in the Rajya Sabha (the upper house of Indian Parliament).

Allegation - As per the chargesheet filed by CBI Kanimozhi has 20% stake in her family owned Kalaignar TV, her step-mother Dayalu Ammal owns 60% stake in the same channel. CBI alleges that Kanimozhi was an "active brain" behind the channel's operations and she worked along with former telecom minister A. Raja to get DB Realty promoter Shahid Balwa to circuitously route 200 crore (US$44 million) to Kalaignar TV.

According to CBI, Kanimozhi was in regular touch with A Raja regarding launching of Kalaignar TV channel and its other pending works. CBI alleges that A Raja was further pursuing the cause of Kalaignar TV not only for getting registration of the company from Ministry of Information and Broadcasting but also for getting it in the DTH operator TATA Sky's bouquet.

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468 and 471. Booked under the Prevention of Corruption Act.

Status - Taken into custody (arrested) by CBI on 20 May 2011.[52] [53] Granted bail on 28 November 2011 after spending 188 days in judicial custody.

Bureaucrats accused

Bureaucrats named as accused in the chargesheet filed by CBI in the Special CBI Court, allegations levelled against them by CBI and charges framed against them by the Special CBI court.

Siddharth Behura :

Designation - Telecom Secretary when licenses were granted.[28][56]

Allegation - According to the charge sheet filed by CBI, Behura conspired with A. Raja & several other accused. CBI alleges that when the application deadline time was declared as between 3:30 PM to 4:30 PM, Behura allegedly shut counters to physically block other telecom companies.

Charges - Criminal breach of trust by a public servant under section 409, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468 and 471. Booked under the Prevention of Corruption Act for accepting illegal gratification.

Status - Taken into custody (arrested) by CBI on 2 Februay 2011and lodged in Tihar jail since then (as of early February 2012). Applied for bail a number of times but every time bail got rejected.

RK Chandolia :

Designation – Raja's private secretary when licenses were granted. Allegations - As per the charsheet filed by CBI, like Behura, Chandolia too conspired with A. Raja & & several other accused. The agency alleges that when the application deadline time was declared as between 3:30 PM to 4:30 PM, Chandolia along with Behura allegedly shut counters to physically block other telecom companies.

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120 B, cheating under section 420 & forgery under sections 468 and 471. Booked under the Prevention of Corruption Act

Status - Taken into custody (arrested) by CBI on 2 Februay 2011. Granted bail by the special CBI court Dec 1, 2011. The high court took suo motu notice of newspaper reports of the bail granted to Chandolia and stayed it on Dec 2, 2011.

Corporate executives accused

Corporates named as accused in the chargesheet filed by CBI in the Special Court and charges framed against them by the Special CBI court.

Sanjay Chandra

Designation - Former MD, Unitech Wireless

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468 and 471. Booked under the Prevention of Corruption Act.

Gautam Doshi :

Designation - Group MD, Reliance Anil Dhirubhai Ambani GroupCharges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468 and 471. Booked under the Prevention of Corruption Act

Hari Nair :

Designation - Senior Vice-President, Reliance Anil Dhirubhai Ambani Group

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468 and 471.Booked under the Prevention of Corruption Act

Surendra Pipara :

Designation - Senior vice- President, Reliance Anil Dhirubhai Ambani GroupCharges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468 and 471. Booked under the Prevention of Corruption Act

Vinod Goenka :

Designation - Promoter and Managing Director, DB Realty & Swan Telecom

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120 B, cheating under section 420, forgery under sections 468 and 471, fabrication of evidence under section 193. Booked under the Prevention of Corruption Act

Shahid Balwa :

Designation – Promoter, DB Realty & Swan Telecom

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant Criminal conspiracy under section 120-B, cheating under section 420, forgery under sections 468 and 471 & fabrication of evidence under section 193. Booked under the Prevention of Corruption Act.

Asif Balwa (younger brother of Shahid Balwa ) :

Designation – Director, Kusegaon Fruits and Vegetables

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420, forgery under sections 468 and 471 & fabrication of evidence under section 193. Booked under Prevention of Corruption Act

Rajiv Agarwal :

Designation - Director, Kusegaon Fruits and Vegetables

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420, forgery under sections 468 and 471, fabrication of evidence under section 193. Booked under Prevention of Corruption Act

Sharath Kumar

Designation – Managing Director, Kalaignar TV

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420,

forgery under sections 468 and 471 & fabrication of evidence under section 193. Booked under Prevention of Corruption Act

Ravi Ruia :

Designation - Vice Chairman, Essar Group

Charges - Criminal conspiracy under section 120 B & cheating under section 420 of Indian Penal Code.

Anshuman Ruia :

o Designation - Director, Essar Group

Charges - Criminal conspiracy under section 120 B & cheating under section 420 of Indian Penal Code.

Vikas Saraf :

Designation - Director for strategy and planning, Essar Group

Charges - Criminal conspiracy under section 120 B & cheating under section 420 of Indian Penal Code.

IP Khaitan :

Designation - Promotor, Loop Telecom

Charges - Criminal conspiracy under section 120 B & cheating under section 420 of Indian Penal Code.

Kiran Khaitan :

Designation - Promotor, Loop Telecom

Charges - Criminal conspiracy under section 120 B & cheating under section 420 of Indian Penal Code.

Film and entertainment persons accused

Karim Morani :

Designation - (Promoter of Cineyug Films)

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420, forgery under sections 468 and 471, fabrication of evidence under section 193. Booked under the Prevention of Corruption Act

Corporations accused

Companies named in the chargesheet filed by Central Bureau of Investigation (CBI) in the Special court and charges framed against them.

Unitech Wireless :

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420 & forgery under sections 468 and 471. Booked under the Prevention of Corruption Act.

Reliance Telecom :

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420, forgery under sections 468 and 471. Booked under the Prevention of Corruption Act

Swan Telecom :

Charges - Criminal conspiracy to cause criminal breach of trust by a public servant, criminal conspiracy under section 120-B, cheating under section 420, forgery under sections 468 and 471. Booked under the Prevention of Corruption Act[28]

Other companies named in the chargesheet are:

Loop Telecom Pvt Ltd

Loop Mobile India Ltd

Essar Tele Holding Essar (Parent group of Essar Tele Holding)

Media persons accused

Media sources such as OPEN and Outlook reported that two senior journalists Barkha Dutt (Group Editor of NDTV) and Vir Sanghvi (Editorial Director of Hindustan Times) knew that corporate lobbyist Nira Radia was influencing the decisions of appointment of telecom minister. Radia wanted A Raja to be made telecom minister. The two magazines made public the telephone conversations between Nira Radia, Barkha Dutt & Vir Sanghvi. Radia's phones were being tapped by Income Tax department. Critics allege that Barkha Dutt and Vir Sanghvi knew about nexus between government and the media industry but still they supported this corrupt activity and suppressed news reporting the discovery of the corrupt practice. However these people were not named as accused in the chargesheet filed by CBI.

License quashed

On 2 February 2012 Supreme Court of India quashed all 122 spectrum licences granted during the tenure of former communications minister A Raja. The allocation of 2G spectrum was described by Supreme Court as "unconstitutional and arbitrary".The bench of Justice GS Singhvi & Justice AK Ganguly imposed fine of 5 crore on Unitech Wireless, Swan telecom and Tata Teleservices and 50 lakh fine on Loop Telecom, S Tel, Allianz Infratech and Sistema Shyam Tele Services Ltd. The Supreme Court's ruling said the current licences will remain in place for four months, in which time the government should decide fresh norms for issuing licences, a lawyer involved in the case said. The apex court said the Central Bureau of Investigation (CBI) would submit its report on the 2G scam probe to the Central Vigilance Commission (CVC).

The Supreme Court said in its order that then telecom minister A. Raja "wanted to favour some companies at the cost of the public exchequer" and listed seven steps he took to ensure this happened. and the seven steps were :

1. After taking over as telecom minister, Raja directed that all applications received for UAS licences should be kept pending till receipt of the Trai's recommendations.

2. The recommendations made by Trai on 28 August 2007, were not placed before the full Telecom Commission which would have included the finance secretary. The notice of the meeting of the Telecom Commission was not given to any of the non-permanent members though Trai's recommendations for allocation of 2G spectrum had serious financial implications and it was therefore necessary for DoT to take the finance ministry's opinion under the Government of India (Transaction of Business) Rules, 1961.

3. The DoT officers who attended the Telecom Commission meeting held on 10 October 2007, had no choice but to approve Trai's recommendations, since they would otherwise have "incurred" Raja's "wrath".

4. Since Cabinet had approved recommendations made by the Group of Ministers, the DoT had to discuss the issue of spectrum pricing with the finance ministry. But, since Raja knew that the finance secretary had objected to the allocation of 2G spectrum at rates fixed in 2001, he did not consult the finance minister or other officials.

5. Raja brushed aside the law minister's suggestion that the matter should be placed before the empowered group of ministers. Also, within hours of the receipt of the suggestion made by the PM in his letter dated 2 November 2007, that keeping in view the inadequacy of spectrum, transparency and fairness should be maintained in allocation of the spectrum, Raja rejected it saying that it would be unfair, discriminatory, arbitrary and capricious to auction spectrum to new applicants because it would not give them a level-playing field. He also introduced a cut-off date of 25 September 2007, for considering applications though only the previous day a DoT press release had said 1 October 2007, would be the last date.

This arbitrary action of Raja "though appears to be innocuous was actually intended to benefit some of the real estate firms who did not have any experience in dealing with telecom services and who had made applications only on 24.9.2007, i.e. one day before the cut-off date fixed by the C&IT minister on his own".

6. The cut-off date of 25 September 2007, decided by Raja on 2 November 2007, was not made public till 10 January 2008, and the first-come-first-served principle followed since 2003 was changed by him at the last moment through a press release dated 10 January 2008. "This enabled some of the applicants, who had access either to the minister or DoT officers, get bank drafts prepared towards performance guarantee of about Rs 1,600 crore".

7. "The manner in which the exercise for grant of LoIs to the applicants was conducted on 10.1.2008 leaves no room for doubt that everything was stage managed to favour those who were able to know in advance change in the implementation of the first-come-first-served policy." As a result, some firms which had submitted applications in 2004 or 2006 were pushed down in the priority and those who had applied between August and September 2007 succeeded.[171][173]

Telecom companies affected by cancellation of licenses

The table below shows list of companies whose license were cancelled

Name of companyUninorSistema Shyam TeleServices Limited, now MTS IndiaLoop Mobile formerly BPL MobileVideocon Telecommunications LimitedEtisalat-DBIdea CellularS TelTata Teleservices

After effects of Supreme Court's verdict

Batelco quits India - Batelco, the Bahrain telecommunications company holding 42.7% stake in S Tel declared that it has agreed to sell its entire holding to Indian partner Sky City Foundation Ltd for 65.8 million Bahraini dinar ($174.5 million).

Response to scam

Opposition demands Joint Parliamentary Committee (JPC) - As soon as the Indian media started citing Comptroller and Auditor General of India's report which pegged the loss at 1.76 lakh crore, the Indian opposition parties unanimously demanded formation of Joint parliamentary committee (JPC) to investigate 2G scam. However the Indian government rejected the demand of opposition. Later when the winter session of parliament began on 9 November 2010, opposition again pressed for (JPC) but once again the demand was rejected. The opposition's demand for (JPC) gained further momentum when Comptroller and Auditor General of India's report was tabled in Parliament on 16 November 2011. The

opposition blocked parliament proceedings and again pressed for JPC. With Govt again rejecting the demand there was logjam in parliament. Speaker of the Lok Sabha, Meira Kumar tried to break the logjam but her efforts didn't bear any fruit. Finally the winter session of parliament concluded on 13 December 2010 . The plan was to introduce 22 new bills, take up 23 pending bills for consideration and passing and withdraw three bills but that didn't happen because the parliament was allowed to function for only 9 hours. In February 2011, after resisting the Opposition demand for over three months, the government finally agreed to constitute a Joint Parliamentary Committee (JPC) to probe the 2G spectrum allocation issue. The government announced it formally on 22 February 2011.

Jayalalitha accuses M. Karunanidhi - In early November 2010 Jayalalithaa accused the state chief minister M Karunanidhi of protecting A. Raja from corruption charges and called for A. Raja's resignation. By mid November A. Raja resigned.

CAG issues show-cause notices - In mid November the comptroller Vinod Rai issued show-cause notices to Unitech, S Tel, Loop Mobile, Datacom (Videocon), and Etisalat to respond to his assertion that all of the 85 licenses granted to these companies did not have the up-front capital required at the time of the application and were in other ways illegal. Some media sources have speculated that these companies will receive large fines but not have their licenses revoked, as they are currently providing some consumer service.

Causes of Scams in India

India achieved its freedom in 1947 and the leaders of then hoped to create a nation on principles and ethics. But somewhere things went wrong. People who mattered starting from politicians to bureaucrats to Govt employees to entrepreneurs, all started finding the flaws in the system and started to mint black money for their own benefits. Here are some obvious reasons that has helped spread of corruption in India:

1. We still follow some archaic laws, some of which were formed decaded back, that entertain corruption in society or deny/delay justice with no transparency or accountability. The current law keeps the cases dragging for years and years till people forget all about the case or the scamster dies and the case is closed. Even those who do get booked, get a simple jail term of few years, which is not a big deterrent for many scamsters.

2. The English system was implemented in our constitution, govt and education sectors without giving much thought about the needs of the local Indian population. We did not even care for our own anna-tola system, blindly choosing to go with the metric system being followed in UK.

3. We have continued to chose our leaders on the basis of caste and religion. However, we forget that the caste and religion issue is raised only for political purposes and that these visionless leaders end up making money for only themselves.

4. India being surrounded by developing countries does not have the competition for quality and relies too much on developed countries.

5. Attempting to unite various cultures, regions, castes and religions as a single nation through coercion rather than good governance and social justice.

6. Religious fanatics who create an apartheid society or instill religious differences to prevent rationalism and attempt to keep the majority of citizens under a limited number of people for good.

7. Historically Indians were being suppressed, which instilled slavery tendencies. This does not allow them to come out of the mess. Most Indians accept corruption and bribing as part of their custom and think of it as part and parcel of their life.

8. Citizens learn more than one language i.e. English, mother tongue and the national language. This renders them not having a firm command in any language. Majority of the Indians are taught the English language in academics, which pushes the non-English speaking minority backward and more prone to corruption.

9. Some of the bureaucratic and administrative procedures are redundant. This coupled with less automation and transparency provides employment through corruption.

10.Use of electronic voting machines, with no clue/acknowledgement of whom the citizen has voted. This makes it easy for the politicians to manipulate votes. The government instead projects India as a software giant, but sadly all we are doing is demanding outsourcing of public sector department/governance work of the developed countries.

11.Intentional Collapse of democratic and civil institutions by policy makers, which entertains corruption to be associated to power by placing corrupted or subservient persons at important decision making points in the system.

12.The absence of autonomous institutions with responsibility, accountability and transparency combined with way too many people in positions with discretionary powers and no recall option of people in power is a sticking point in containing corruption.

13.Clear cut separation of the three divisions of the constitution i.e. executive, judiciary and the legislature, which would minimize corruption and improve quality of service and performance.

14.There are far too many criminals and thugs in the system that has converted the police, political and judicial systems into legalized criminal networks. These systems have become criminal networks rather than citizen friendly networks that assist in providing good governance. These systems are used to encourage illegal businesses.

15.Capitalism when implemented incorrectly can lead to kleptocracy and plutocracy. This leads to a situation where development of business or

infrastructure is dependent on bribing the thugs intentionally placed by the ruling governments. This in turn hampers the action taken by fraud investigation units on perpetrator

Corruption in India

From small time clerks to the high profile politicians, commissioners, police inspectors, traffic police, stock exchange brokers, military establishments, recruiters, sportsmen, judiciary and most of the government employees, corruption is seen and felt in every transaction from bottom of the chain till the top.

In the recent times the private Indian companies captured the top spot in encouraging corruption when dealing with international clients in order to grab lucrative contracts.

Why are the corrupt susceptible to corruption?

The low salaries of people made them susceptible, bringing with it more inefficiencies and the easy way of making money with less or no accountability. The crime of corruption is easily forgotten, the law offers easy way back into the mainstream and acceptance by the society. In addition to that it is the lure of luxury, personal status enhancement and the false sense of elitism that makes the corrupt vulnerable to illegal and unethical means of acquiring wealth.

The cultural connection and the other reasons.

Indian society still has a cultural setup of having the "man of the house" to work for a living, while the wife usually deals with the household work, and this puts a pressure on the man to make the living more luxurious. The routine jobs are usually for life-long, with the support of a union there is a lesser fear of losing the job and there is the pressure of dealing with rising prices of commodities and sponsoring future education of children. The society, the social upbringing, the culture and a general greed also plays a critical role in influencing a timid mind. The lack of instincts and to avoid the time consuming bureaucratically setup of the organization, the corruption may be a easy way out for people who bribe to make things happen.

How can we stop corruption? Greater solutions may include population control to improve the quality than the quantity , Controlling population will bring up the quality of life and thus lesser competition and effective control of people and government processes. However feasible solutions are to impart moral principles in schools, and introduction of stringent audits, accountability, effective tracking of corrupt individuals through citizen cards or tax id's.

Computerization of processes, privatization of public sectors, eliminating the chain of corruption by not just punishing the first level but also higher levels involved. Corruption is not limited to atheists, even the most corrupts are highly religious and have close family ties, in other words corruption has no boundaries. Religion and religious congregations can support and promote anti-corruption drives.

Corruption is NOT a luxury tax. Whoever described corruption is a luxury tax probably said it out of frustration , the religion of corruption, the corruption of politics, the dishonest souls and perversion of integrity is unpardonable.

Corruption in the news!

The World Bank has suspended $800 million worth of loans to India's health sector after detecting corruption in procurement. Fair enough: corruption should be checked. Yet, if corruption is really a no-no, the Bank should stop almost all lending to India, so widespread is corruption here. The Bank may have just discovered corruption, but it is no news at all to the public....

Top secrets leaked for MNC jobs in US? : All it took was an offer of plum portfolios in United States multinational companies like Microsoft for two senior staffers of National Security Council Secretariat to leak top secret documents to elusive American ‘diplomat' Rosanna Minchew, a Delhi police probe has revealed. Security agencies are still taking stock of the extent to which classified files have been accessed by the two accused NSCS employees.