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Corruption – an analysis
Corruption is generally defined as the dishonest or fraudulent conduct by those in
power, typically involving bribery. It is the abuse of entrusted power for private gains.
Transparency International explains it as, “acts committed at a high level of government that
distort policies or the central functioning of the state, enabling leaders to benefit at the expense
of the public good. Petty corruption refers to everyday abuse of entrusted power by low- and
mid-level public officials in their interactions with ordinary citizens, who often are trying to
access basic goods or services in places like hospitals, schools, police departments, and other
agencies. Political corruption is a manipulation of policies, institutions, and rules of procedure in
the allocation of resources and financing by political decision-makers, who abuse their position
to sustain their power, status and wealth”.

Couple of decades ago corruption was seen so deeply ingrained (as a matter of it is at
present as well at most of the places) that it was considered a necessary price for doing any
business and fighting against it was regarded as futile and even harmful. But the creation of civil
societies, efforts made by Institutions like Transparency International, and emergence of media
exposing the corruption scandals inspiring widespread public condemnation has been very much
instrumental in taking many of the world leaders to the task. As a result of this many
governments and international bodies had to introduce anti-corruption reforms including
devising mechanism to recover losses. Despite all this the world has a long way to go to learn
from the ongoing scandals and fight corruption effectively.

The extent in Pakistan as compared to the world:

According to Transparency International Pakistan (TIP) Pakistan ranks 33 among 180

countries in 2018, a little better than 2015 ranking 30. It is at better position than Iran and
Bangladesh with score 28 and 26 respectively for 2018. However, India has been shown
comparatively at better position with a score of 41.

The top 10 cleanest countries are Denmark, New Zealand, Finland, Singapore, Sweden,
Switzerland, Norway, Netherlands, Canada, and Luxemburg (with score of 88 to 81) – the more
the score the more the country is cleaner.
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The topmost corrupt countries are Somalia, Syria, South Sudan, Yemen, North Korea,
Sudan, Guinea Bissau, Equatorial Guinea, Afghanistan, and Libya.- with a score ranging 10 to
17 (10 for Somalia and 17 for Libya).

This indicates that the maximum corruption has been observed in those countries which are
war-torn, and civil wars are going on. In other words where the government has extremely loose
control over the masses. On the other hand clean countries are those where the good governance
prevail, there is high literacy and institution of public accountability performing at its best.

Despite the fact that conditions have improved a bit due to a peaceful transfer of power,
maturity of political parties and an independent and powerful judiciary, corruption is still
prevalent with full force. TIP has stated in its report, “Corruption within the public sector
remains one of the biggest challenges, faced not only by Pakistan but the world as a whole,
particularly in areas such as political parties, police justice system, privatization, etc. “In
2012, Transparency International (TI) calculated that Pakistan had lost more than Rs.8.5
trillion (US$ 94 billion) in corruption, tax evasion, and bad governance.

The main source of political corruption is the development budget where funds are allocated
to elected members of national and provincial assemblies who prefer to recover millions of
rupees they spend on their election campaign.

Similarly, allotment of land (agricultural, industrial, commercial and residential) to officers

and bureaucrats is also a source of corruption.

Causes of corruption:
1. Greed of money, desires.
2. Loose anti-corruption, administrative and judicial control
3. Weak democratic institutions, weak civil participation, and low political
transparency.
4. Inefficient administrative structures.
5. Low print and electronic media freedom.
6. Norm of in-group favoritism
7. Political instability
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8. Low levels of education and weak or non-existence of ‘Institution of public

accountability
9. Poverty

Impacts on the economy:

In Pakistan, corruption has caused an unbearable loss to the economy in recent decades. A
newspaper has reported that the estimated loss corruption caused was more than Rs12 billion per
day including Rs7 billions of tax evasion. The tax-to-GDP ratio remains low at 8% mainly due to
corruption.

The energy crisis, which kept the economy crippled is also being considered as an outcome
of corruption. According to a rough estimate, corruption in the energy sector- including theft and
line losses- has cost the economy approximately Rs100 billion in the past five years. These
pilferages have resulted into a massive circular debt, which lead the country to face acute energy
shortages.

The widespread corruption over the years has had a significant and damaging impact on
foreign direct investment (FDI). The World Bank highlighted this in a report on Pakistan’s
investment climate. According to the bank, corruption, a serious and growing obstacle to the
investment climate of the country. It is a common norm for firms to pay informal payments in
the form of kickbacks and commissions to government officials and all those involved even in
the political circles to get things done.

The tax havens abroad in the form of offshore companies and foreign commercial banks
have also encouraged the world wide high-level corruption as they encourage the corrupt elite of
the developing world to park their illegally earned money with them. And they provide all kind
of assistance and protection to this money. It is also very difficult to retrieve such illegal money
from these institutions. Thus they have become the main source of laundering the illegal money.
The corrupt elite also transfer money abroad and purchase highly expensive buildings in all the
important capitals and resorts of the world. The rich countries encourage this practice as this
helps their economies. Many of Pakistani political elite has also been reported to have deposited
their illegally earned money in such safe havens.
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How to end corruption?

Ending corruption or arresting the ongoing trend depends on formulation of a
well-structured strategy which of course starts with the head of the state
commensurating with his/her level of the willingness or the
determination/commitment level. There is no silver bullet exists to fight corruption.
However, many countries have made significant progress in curbing corruption, the
examples of which have been made part of this write-up. Here are some ways to
tackle this issue.
1. Effective law enforcement:
It is essential that the corrupt are punished and taken to task as breaking the cycle of
impunity is the most important prerequisite. Foolproof execution of the enacted laws upheld by
an independent and effective judicial system.

2. Reforming the financial management and auditing system:

By reforming the financial management system and strengthening the auditing system has
happened to be very instrumental in many countries in curbing the corruption. Proper auditing
played an important role in preventing the misappropriation of resources.

3. Public’s access to information:

Public’s access to information has been very much effective in curbing corruption. For the
reason that access to information increases the responsiveness of the government, simultaneously
increasing levels of public participation in the country. Empowering citizens and holding the
government accountable them is a sustainable approach that helps to build mutual trust between
citizens and government. Community monitoring initiatives in some cases have contributed to
the detection of corruption, and reduced leakages of funds.

4. Solution in the world perspective:

Park Chung-hee took over the government in South Korea in 1961 and embarked upon a
comprehensive plan to promote economic growth in the country by establishing a blend of state
capitalism with free enterprise, i.e., private-public conglomerate. The strategy revolved around
export-oriented labor-intensive industries to give employment to the young working force
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available. There were reports about corruption in the country but that happened to be a temporary
phenomenon. However, the factors which served as effective checks and balances against
corruption were strong and independent judiciary and an active parliament.

According to Dr. Mahathir Mohamad, it was the system of cooperation between the public
and private sectors that led to Malaysia’s success. The private sector has to be encouraged as the
main source of tax earning, and if we help them to make profits, they will pay more taxes. Hence
bureaucratic procedures were reduced to the minimum to encourage the private investment.
Delays were removed. And the bureaucrats were told, that their pay is being paid by these
people.

5. The role of media in exposing corruption cases in Pakistan:

Positive role In Pakistan prior to 2002, the electronic media was entirely dominated by state-
owned institutions like Pakistan Television Corporation and Pakistan Broadcasting Corporation.
However, this monopoly was thwarted, when the Musharraf regime allowed the private
television channels to be operated. This liberalization of the electronic media proved to be a
major force in exposing corruption-related cases and scams. These include; Rental Power
Projects (RPP) scam 2006, involving several instances of bribery in the Rental Power Projects
(RPP) where top-level ministers were involved.

PIA was reported to have been mismanaged by the executive authorities giving rise to a
corrupt culture of bribery. Corruption in PIA led to losses of around US$ 500 million. Similarly,
massive financial losses were reported for Pakistan Railways caused by embezzlement. Media
reported a scandal involving federal ministers extorting illegal payouts from travel agents
involved in fleecing Hajj pilgrims to Saudi Arabia.

Media also reported on 40 NATO containers that went missing on their way to the
International Security Assistance Force (ISAF) in Afghanistan. It was later identified that the
missing containers carried cargo that was considered contraband in Pakistan, including liquor to
be sold in Pakistan.

The media reported a major scam in the Pakistan Steel Mills involving Rs.26.5 billion.
Ephedrine quota case was also brought to the notice of the public. Political leadership was found
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involved in allocating a quota (worth Rs.70 billion) of controlled chemical ephedrine to two
different Multan-based pharmaceutical companies.

Social media also served as an effective tool to hold the nation's to-be-leaders "accountable"
for various issues like corruption. Citizen journalism is emerging as a growing phenomenon and
an important tool that can be used to curb the rampant corruption and thus strengthen democracy.

Various efforts over the past few years have been made to develop institutional mechanisms
to tackle the problem. For instance, establishment of National Accountability Bureau with
comprehensive powers to investigate and prosecute cases. But this setup could not result into any
significant achievement in the past.

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