India has made marginal progress on Transparency International’s latest Corruption Perception Index, bettering its transparency score from 38 in 2015 to 40 in 2016. It is now ranked 79th —along with China and Brazil—out of 176 countries. While the high-stakes demonetisation move and the push towards a less-cash economy may help rankings in the future as it gets more and more difficult to carry out illegal transactions, it is not until India moves away from populist “anti-poverty” measures like PDS, MGNREGA, etc, that any meaningful dent in corruption will start showing.
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A Transparency International analysis shows a high correlation between social exclusion (read poverty or inequality) and corruption. It is, thus, easier to sell populist policies to the electorate in a country with a higher population of poor than one that has a smaller such population. However, leakages in distribution through a PDS or a MGNREGA—as high as 58%, as per one estimate, in the case of the latter—stoke corruption levels which in turn create conditions for more populist schemes to crop up. A vicious cycle is created. The disenchantment with mainstream policy-making, thanks to how it fosters corruption, is likely to help demagogues rise. Therefore, India, along with a host of other measures, also needs to move beyond such programmes and look at Aadhaar-linked, targeted income support that leaves little room for graft if it is to effectively fight corruption.