Graft in India is nothing new.  Corruption infects every level of government – from routine ministerial tasks like obtaining a driver’s license to more complex business projects – India has spawned a political movement to clean up government.  Small businesses have to pay off police and local constables, health, safety and hygiene inspectors.  Parents have to pay school headmasters to make sure thie children are accepted at schools.  Traffic police extract routine payments by stopping and detaining citizens.

This past summer India was captivated by anti-corruption protests – informally called Team Anna, after the Gandhian “Anna” Hazare who became the face of the protest.  Hazare, 74, has harnessed this grassroots frustration to launch a popular movement. India’s prime minister, Manmohan Singh, has looked out of touch.

Hazare is campaigning for a powerful new anti-corruption ombudsman with the right to investigate senior politicians, officials and judges. India is expected to consider a number of anti-corruption legislative proposals, including  bills to protect whistleblowers and a bill to prevent bribery by foreign officials.  The scope of the legislative proposals are at the center of the controversy since anti-corruption interest groups are demanding that any new proposals should include all government officials, including law-makers and judicial officials, and make transparent political donations and bidding on public contracts.

Businesses have rallied around a proposed “code of business ethics.”  But the public complains about petty corruption that every citizen faces in Indian society.  Transparency International found that one out of every two Indian citizens paid a bribe during the last year (global average is one out of every four).

India’s citizens are willing to support aggressive measures to reduce corruption.  Legislative proposals are being backed by large numbers of Indians.  The key to reducing corruption is to bring transparency to as many government functions, along with effective prosecution and punishment of corruption.

Senior Congress party politicians argued that some level of graft was “inevitable” in a developing economy. However, analysts said the extent of the problem in India – which ranks at 87 out of 178 on the campaign group Transparency International’s index.

INDIANS’ anger over rising corruption has reached feverish levels. What people are calling a “season of scams” includes the alleged theft of billions by officials behind last year’s Commonwealth games in Delhi; $40 billion in revenues lost from the crooked sale of 2G telecoms licenses; and over $40 billion stolen in Uttar Pradesh alone from schemes for providing food and fuel for the poor. Foreign businessmen, who have slashed investment over the past year, rank graft as their biggest headache behind appalling infrastructure.

Even with the high levels of corruption, India’s economy continues to grow at a rapid pace.  Corruption raises costs not just to Indians, but also to the foreigners whose capital India needs.