The Hindu Business Line : Aspects of corrupt behaviour

Indian businessmen are learning the ropes of playing the international game as fast as their competitors from Brazil, Russia and China. In relative terms, it would be foolish for a country like India to allow competitors to get what they want in the global market through the use of every means at their disposal, whether above board or under the table. The so-called BRIC countries are leaving no stone unturned to forge ahead in the highly competitive world.

Transparency International's latest index of bribe-payers while doing business abroad includes India in the 30th position, a performance which — if reactions are anything to go by — has attracted a lot of attention, especially within the country.

Clearly, what this means — if it means anything important at all — is that, one, India has entered the big league of economies doing business in the international marketplace and, two, that it is using `unethical' methods to compete in that market.

Leaving no stone unturned

First, let us see what the bribery-perception list has to tell us about other countries, both among the rich and the poor. (The countries were selected as leading international or regional exporting countries whose combined global exports represented 82 per cent of total world exports in 2005.)

The five `cleanest' countries are Switzerland, Sweden, Australia, Austria and Canada. Using the same yardstick, the five `most tainted' economies are Taiwan, Turkey, Russia, China and India. Brazil is within the last eight, thus projecting the rather firm view that the so-called BRIC countries (Brazil, Russia, India and China) — which are seen to be the giant-economies of the future — are leaving no stone unturned to forge ahead in the highly competitive world, even by using operational methods which are not considered to be above board.

Coming to the normative part of things, what, precisely, is the point of concern among those who feel that the increase in bribes in the international marketplace is something to be avoided lock, stock and barrel? Certainly, ethical behaviour on the part of global businessmen is something which should always be aimed at on the ground that such behaviour will make international business `cleaner'. Seen in absolute terms, there can be no two views on this. But this statement itself contains the seed of another point of view which, if developed fully, can even be used to justify what is called `unethical' behaviour in the world's marketplace — especially if such action is the only way left open for the emerging economies to find for themselves a place in the sun.

When viewed in a `relative' scenario, it would be downright foolish for a country like India to stand aside and allow competitors to get what they want in the global market through the use of every means at their disposal, whether above board or under the table. Quite clearly, in such a situation, it would not make good sense from the point of view of national interest to watch someone else wrest an export order from under one's nose through the bribery route because the entity that suffers at the end of the process is the national economy itself.

Clean governance

It can, of course, be argued that, as a matter of policy, the means used by Indian nationals to make headway in the global marketplace should be above reproach if only because "clean governance" is an end itself no matter whether in Indian conditions or in the world at large. In terms of ethical behaviour, this is just what it should be, particularly in view of the fact that, within the country, the drive for clean governance is (or should be) right at the top of the agenda of public action.

Having said this, it will be worthwhile to consider whether Indian businessmen should, so to speak, turn the other cheek while others not only refuse to do so but also decamp with the booty. The pursuit of ethical behaviour in this specific regard — where the opportunity cost is very high indeed from the point of view of the national economy's development — would probably be a sensible option to adopt if one knew that a level-playing-field would be enforced within a definite time-span. The crucial question is whether there is any possibility of something like this happening in the near future, which would influence the operations of Indian businessmen abroad today?

Let us see what the Berlin-based Transparency International (which conducts the corruption-perception and bribery surveys) itself has to say on the subject and whether it holds out any hope for the situation to improve within a specific time-span.

First of all, the body laments the fact that "overseas bribery by companies from the world's export giants is still common despite the existence of international anti-bribery laws criminalising this practice".

It adds: "Companies from the wealthiest countries generally rank in the top half of the index (meaning they are `clean'), but still routinely pay bribes, particularly in the developing countries".

More importantly, the point is made that this sort of behaviour on the part of companies hailing from the developed world is extant despite laws and guidelines directed at making business transactions cleaner at the domestic level. After citing the fact that respondents from lower-income countries — in Africa, for example — have identified French and Italian companies as being among the worst offenders in this respect, the chief executive of Transparency International has been quoted as saying: "It is hypocritical that OECD-based companies continue to bribe (their way) across the globe while their Governments pay lip-service to enforcing the law," adding, "TI's Bribe Payers' Index indicates that they are not doing enough to clamp down on overseas bribery" and that the "enforcement record on international anti-bribery laws makes for short and disheartening reading".

Clearly, therefore, the cleansing of the international marketplace of the cancer of bribe-giving and -taking is not proceeding at a pace that would strengthen the hands of those, say within our own country, who could use the Transparency International finding to clean up the place, in a manner of speaking. More fundamentally, in such a situation, should Indian businessmen operating in the world at large have nothing better to do than kneel to offer a prayer with the hope that those who are taking their business away through the use of `unethical' means be consigned to the flames of Hell, at the same time hoping for a miracle which will allow them to sail through unscathed in business terms?

Learning the game

This does not appear to be a sensible course to adopt given the rough and tumble of today's international business deals.

Indeed, some sceptics may even exult at the finding that Indian businessmen are learning the ropes of playing the international game as fast as their competitors from Brazil, Russia and China — which is far more fruitful from the point of view of the national economy's long-term, strategic interest than would have been the case if, in the interest of being `clean', they stood around and watched the world go by with their hands stuck irretrievably in their empty pockets.

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