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Corruption business faces
The Indian Express<, India
Friday, December 10, 2010

Bibek Debroy
Saratov Chamber of Commerce and Industry undertook a project with an objective to reduce corruption of a certain variety. The fndings were that legal regulation is effective, effective laws lower corruption, and implementation lags behind enactment of laws.Reform principles are the same everywhere. The short point is that this isn’t on the agenda as much as it should be, writes Bibek Debroy in The Indian Express.

Saratov Chamber of Commerce and Industry undertook a project with local chambers in Astrakhan, Volgograd, Kirov, Smolensk, Perm, Khabarovsk and Novorossiysk. This was implemented by Centre for International Private Enterprise (CIPE) and methodology and survey results are there on CIPE’s website. Support was from USAID.

The objective was to reduce corruption of a certain variety.


In the Russian context, here are the recommendations. (1) Enact a Russian Federation Law on administrative regulation. (2) Adopt regulations on maintenance of a single registry for State and municipal services. (3) Monitor the effectiveness of laws annually. (4) Use the methodology to analyze (read streamline) administrative reglaws.ulations. (5) Use the methodology to monitor regional and local implementation. (6) Incorporate concept of transparency into relevant legislation. (7) Establish procedures for legislative bodies to review regulations issued by the executive. (8) Involve the academic community in drafting regulations.


Often the focus, especially when undertaken by industry associations, is on large corporate sector. However, it is small business that faces brunt of these regulations and informal and unorganized self-employment is higher in India than in developed countries. Three findings from the Saratov survey deserve mention. (1) The more legal regulation is effective, lower the corruption. (2) The more effectively laws are implemented, lower the corruption. (3) Implementation lags behind enactment of laws. One way to interpret this in the Indian context is that greater the discretion, the more corruption there is.


Reform principles are the same everywhere. The short point is that this isn’t on the agenda as much as it should be.

This article was published in the The Indian Express< on Friday, December 10, 2010. Please read the original article here.
Author : Mr Debroy is a noted economist, based in New Delhi.
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