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Corruption: A curse for SMEs
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Bikky Khosla | 24 Jun, 2014
You are conducting your business in a legal way -- not
evading tax, not manipulating books, not indulging in any unlawful activity.
Shouldn't this be enough reason not to pay any 'under the table' money? But we
all know what the reality is. A few years ago, we conducted a survey which
revealed that almost all participating SMEs had been victims of corruption sometimes
or the other. Things have changed, if not deteriorated, little since then, a
new survey reveals.
Corruption, bribery and corporate frauds have emerged as the
No. 1 risk affecting corporate India, according to the India Risk Survey 2014
carried out by FICCI and Pinkerton. These findings will hardly surprise anyone,
in the background of the recent high-profile political and bureaucratic
corruption scandals such as 2G Spectrum, Delhi Commonwealth Games, and
Coalgate. If we add to this list the grease payments and petty corruption
prevalent in thousands of our public offices spread across the country, the
picture will get even murkier.
While corruption in all its forms and variations has
continued to have its devastating impact on our society and economy, it has not
spared our small businesses as well. Be it getting a new electricity connection
or taking permission from the municipality board for erecting a new office,
transporting goods or getting a fire safety license, applying for shop registration
or excise, MSME schemes or bank loans -- SMEs have to deal with bribe takers
almost at every point of interaction with the system.
Corruption has remained the biggest challenge for the
country for decade after decade and a solution still seems far off. In the
recent years, we have seen increasing eruption of public passions and even
melodramatic mass protests against corruption, the result of which we have seen
in the 2013 Delhi Assembly election. Of course, using the ballot box to fight
graft is a good idea, but besides political will, I also feel the need of a
parallel social movement against corruption for a more inclusive and permanent
solution.
I appeal to you all not to pay bribes at any cost -- offering
bribes is also a punishable offence. Instead raise your voice against any form
of corruption you face and do whatever possible on your part to fight against
it. As far as the SME sector is concerned, it should stand united to take on
bribe takers and corruption. While the existing industry bodies can play a big
role in helping the industry get rid of this endemic, I think small and medium
businesses themselves can set up self-help groups for taking collective actions
against corrupt practices that affect their interests.
I invite your opinions and suggestions.
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Corruption
J.S. Venkatesh | Tue Oct 21 13:54:29 2014
It is easy to say and write that we should not support corruption but practically to carry out business peacefully we have to be a part of it forcibly even if our ethics do not permit. A small and medium business man can not handle all offices personally and if he starts doing it he can not do business and he has to roam from different govt. offices daily. The rules and acts which we dont understand at all are made for the benefit of officials and not for business men. In spite of online submissions of accounts ,the corrupt officials find some or the other faults with us and say we have to pay a penalty of some lakhs. Who is ready to pay such huge penalty for no fault of his and he simply negotiates for some thousands instead. This is my experience. just pay and forget instead of wasting time in fighting with them and losing the business on other side. This is my personal opinion.
coruption : A curse for SMEs
Deepak M. | Tue Jul 8 10:07:57 2014
Those who are taking bribes, actually this people are called spiritual sick, there soul is very weak & poor, Just like one beggar take a new birth but his all thinking is just like same which he was born before taking this life , so don't hesitated to give the offering just you offer the money in front of any religious (holy) place like a temple where poor or beggars asking some kindness to them. God is always giving more who gives others and God takes all thing back (Peace,family & societies Love, Long life with Good health)who ask money & gift for himself only
corruption
Ajit Kshirsagar | Thu Jul 3 06:42:17 2014
the curse called corruption spoils every aspect of our life. SMEs are the lot who cannot afford pay bribes. Most govt officers who get lavish pay packets shamelessly ask bribe from entrepreneurs who invest their own money , work hard, support employees. The situation has to change for good of society as whole.Let us take advantage of the atmosphere generated in country since new government is in saddle.Let us stop paying bribes and fight this evil
Corruption: A curse for SMEs
UDAY | Thu Jul 3 03:55:53 2014
While accepting the views which are Vital in the present situation, advisable to Offer Some forum to the Masses / Society & it's subject to represent as well as to have some basic information from the Experts / Experience Personnel's.
There is NO VOICE to the "Common Man" where he can at least raise the Issue - right from Renewal Of License of the MOPED &/Or getting Copy of the Ration Card lost.
The Million of Crores of Scams like that of COLEGATE & 3 G, & ADARSH" - the common man Suffer's in his day to day Basic Needs.
Advisable to "Build & Widely Publicized" such FORUM - which is the NEED of TIME.
Correcting corruption
C.Sambasivam | Tue Jul 1 12:29:43 2014
Corruption starts from the doorsteps of each bureaucrat and politician and the souls behind them are their frail womenfolks. Generally, the lifestyles of the business community is one step ahead of the common man. This is eye catching for the women of the govt. servants and the politicians-however petty they may be. Their lifestyles create a kind of envy and a sort of yearning for more amenities and needs on par with that of the business people. Instead of leading a life within their rightful resources,their minds hover around their neighbour's lifestyles. They start to pester their life partners to acquire more so as to match their amenities on par with the business community's.When their rightful earnings are sufficient only to meet both their ends,where will they go for the 'extra'? Automatically,to satiate the thirst of their dependents,the politicians and the bureaucrats resort to unlawful earnings. So,elimination of corruption is possible only when an ethical life is resorted to by the common household.Women are the main factors behind ethical lives. Unless the womenfolk change their lifestyles and learn to live with in their means,corruption can not be eliminated from any nation.
corruption
selvi | Mon Jun 30 06:02:45 2014
I agree with you. In India without giving bribes we can do any work in the government offices. Almost all are corrupt. If you resist them without giving bribes our works will not be done not only that they will start troubling us in our routine life. What the common men do for this. Please give your suggestions. We want India to be a corrupt free country.
Present practice on BRIBERY
S.G.Jayaraman | Mon Jun 30 03:53:15 2014
all not to pay bribes at any cost -- offering bribes is also a punishable offence
For Writing or speaking this is alright. In day to day life normal people MSME entrepreneur how much suffer. You may not know.
From Land purchase, Registration , conversion of that to Non agri land, all statutory permissions, at each and every stage we spend a lot and suffer a lot including heavy time delay. In my one case I wander for a Permission from the Collector for more than 18 months. This is TRUE to the core. The application submitted to The collector in 2012 end is not yet cleared till date, in spite of heavy chasing and expenses. Especially the departmental Promotee Officials are addicted to Bribe. They think only for that they work and not for their salary. Who can question these things? These Revenue Officials do only for the Politicians or heavily monied people who pay them in Lakhs. By simple Shouting this can not be changed.
corruption
a.s.rangaraju | Fri Jun 27 06:41:22 2014
Editorial suggestion is the only remedy as of today. Basically it is in-depth rooted among the political circle.
Corruption: A curse for SMEs
A.G. Bhave | Thu Jun 26 07:01:59 2014
Your initiative is very commendable. However, please also keep a watch and control on small enterprises who get illegal facilities and favours by deliberately paying bribes, and those who do not pay employees on time or properly.
(I do not own an SME)
Corruption: A curse for SMEs
Daniel | Thu Jun 26 04:00:35 2014
Of course; we must fight it together. United we stand. We must eliminate the "so called Agents"; under their fees underhand money is hidden.
Curruption!!
John | Wed Jun 25 19:56:26 2014
Is there a solutions that can help stop curruption? than implimenting it and than with time I think will be on its good way.
Raising the salary can be one solution. Hidden camera can be another. and so on.
DON'T BRIBE!
Ramesh | Wed Jun 25 18:36:27 2014
We did not accede to the bribe demand, a huge sum, and we landed up with 6 (SIX !!)Show Cause Notices and they were deliberately issued under the clause which went back 5 years. We had to pay 15,000/ per SCN for each reply to our advocate/Consultants which was more than the bribe amount! This apart the time taken to collate the docs and the data frustrated us badly but we held on. All but one SCN were decided in our favour as they were baseless and the last one has gone to Appellate level where we are sure to win. But now we are thinking was it worth the trouble trying to emulate Anna Hazare! Where is the end unless Excise and Service Taxes are eliminated fully. They are a curse on the Indian SMEs - both - the laws and the officers.
Indirect corruption of regulatory authorities
Rajesh Chauhan | Wed Jun 25 15:18:21 2014
Many regulatory authorities recommends/suggests/insists for employees training/inspection report/survey report/audit to be done by particular third party only. If any organization do this by another party then they finding out many things and put in trouble them. Even for non compliance of legal requirements they indirectly taking bribes. Ultimately working people are at loss & they are taking harsh step in their life.
Corruption a Curse for SMES
Theora Thaituru | Wed Jun 25 15:08:57 2014
I agree with the author entirely. This is a vice that the world must come together to fight at all cost because it has hindered development in many third world countries. The result is that poverty and unemployment have continued unabated in these nations.
I agree that the ballot box is one way to rid the country of corrupt individuals especially those holding public office. However, it is not enough. Countries have to put clear punitive measures against these corrupt public officials and follow them after they have left office. They must be punished and the money they have stolen through corrupt deals recovered.
I am a Kenyan living in the Diaspora and the picture depicted in this article is accurately describing the situation in Kenya.
In 2010, I traveled back to Kenya with the intention of making some investment that would have created hundreds of jobs in the Rift Valley. I bought a piece of land and conducted all the necessary studies including environmental assessment as to the suitability of my project. I then applied for different services including connection to electricity. I was asked to pay ridiculous amounts to get connected to power. I appealed to several individuals at the power company but I was not getting anywhere without paying a bribe. It has taken three painful years to have power connected and during that time, the cost of implementing the project has quadrupled. One cannot begin to calculate loss of income to the company and would be employees.
CORRUPTION SOCIAL EVIL
Hareesha.k | Wed Jun 25 15:01:22 2014
We all sailing in same ship. Who will bell the cat? The more corrupt politicians most of whom are erstwhile goondas and rowdies? The bureaucrats who are the part of this system? The Judicial system which is also becoming corrupt day by day. The reservation system which allows unfit people in all the segments? Now either be united and come to streets to fight against system or pray god to end this KALIYUG.
Stop Corruption In Educational Institutions
Elango, Sharjah | Wed Jun 25 13:58:52 2014
01). Parents are paying hefty amount in several lakhs to get admissions for their wards in Colleges run by Politicians. By this spoiling the younger generation to indulge in corruption after their education.
02). Govt is collecting taxes for providing roads for public use. Then what is the use of collecting toll to create inflation for poor people.
corruption
Suhail Husain. | Wed Jun 25 12:07:27 2014
Welcome to the CLUB…… Pakistan is stated to be one of the most corrupt countries…but in reality China and India beat us.
Corruption.9.Thmb.jpg Corruption: A curse for SMEs
A.K. Shyam | Wed Jun 25 11:09:39 2014
There are two ways of tackling this: ONE- the institution should discourage bribing and issue strict instructions to all that they should abide by it or will face action against such employees; TWO - Make payments online which not only saves manpower but also reduced the corruption percentage.
corruption
i m pragnesh patel(pragnesha patel) | Wed Jun 25 10:21:58 2014
its good idea for nominet in indian comman peaple for anti corruption.
i will join in any place of work in anti corruption thanks .......i m waiting to join
Corruption
Shan | Wed Jun 25 08:24:51 2014
I strongly belive that if you indulge in bribery, you are not a professional and that you need to buy someone to help you throughout the tenure of the project so that a shabby job is done.
Corruption: A curse for SMEs
M R Singanamalli | Wed Jun 25 07:50:06 2014
You are very much right. Not only as organization but even at individual level we need to fight this. However I feel that rules themselves should be changed drastically so that the concerned official do not dare to ask for.
corruption
manish agrawal | Wed Jun 25 07:43:44 2014
corruption is not in our society. It is in our blood. there is more corruption in private companies. If you want to sale something in any company than you have to give huge amount to purchase officer .
corruption
ATUL AGARWAL | Wed Jun 25 07:05:18 2014
Sir, what has been mentioned is absolutely correct. i would definitely like to suggest few points which can help us in reducing corruption to a larger extent.
(1)normally there are 10 departments which are regularly dealing with SMEs & every department has typical norms to be fulfilled which are practically not possible & so raising voice will not solve the purpose. the matter should be discussed with 20 leading SMEs & there suggestions should be taken for amendment in rules so that unnecessary harassment can be stopped immediately.
(2) rules of RTO department immediately needs to be amended as there is rampant corruption in this department & this has ultimately led to increase in transportation cost by 20%.
Ye its true
Gopi | Wed Jun 25 07:01:04 2014
Everyone is a victim of corruption. We have paid nearly 10 Lakh to Planning Authority to get things done even though we had all documents correct and valid. We tried not to give bribe and we had been taken for a ride for nearly 12 months. Since we have invested inland and there were no returns ,we were forced to give bribes. That made everything smooth. Corruption is more here in Karnataka when compared to other states like Kerala. Corruption is everywhere right from peon to top people in all fields.
Corruption: A curse for SMEs
O A Sampath | Wed Jun 25 06:02:37 2014
Perpetration of corruption is due to our poor justice system. Justice
is not rendered in time. It takes years and people do forget about the
crime and criminals. Are we not witnessing hundreds of higher up
people wandering for years without being tried and punished, by taking
bails, knowing fully it will take years before the case can be disposed
of and by that time the long arm of justice can be manipulated. Also
more the delay more is the chance to get acquitted or getting the
benefit of doubt by twisting evidence and witnesses.
There should be a governmental forum with a web site for it, where every
one can without fear expose the bribe taker by narrating and
registering the incidence and it should be investigated discretely and
culprits punished.
Curruption
Pankaj Mohan Sood | Wed Jun 25 05:58:46 2014
We all have to go with the main stream; every one of us has his own justification to give bribe although it pains everyone to give Rs 500-700 for getting a police en query through by a police man or pay Rs 100 or Rs 50 to post man while collecting passport. We are still to find out solution for these cruses, with which we are living with and bringing up.
Bribe taker must have a fear by the system itself, if once a complaint has been reported against them their career/ job may get a permanent dent. If they are fearless of their misdeeds and actions; that is only possible because of his superior either may be supporting to him or is party to his misdeeds.
Flow of corruption and also good behavior , i think flow from top to bottom; further it is easier to check and control the things at top level.
corruption -a course for SMEs
SANJIV KUMAR | Wed Jun 25 05:53:07 2014
we agree on the subject that we should not pay bribe to any of the government officials but if the business man became 100% honest and not interested to pay bribes where it is required, the respective file will not move speedy and they suffer to lose business.
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Re: corruption -a course for SMEs
Sunny | Wed Jun 25 06:23:17 2014
Well Said! You risk loosing business over bribes.
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Corruption - Unavoidable Truth
KashD | Wed Jun 25 05:33:03 2014
I agree with the above story.
But the fact is, who will support.
the senior authorities? All are corrupt.
Our work doesn't progress, they give big excuses and reasons, to torture us by delaying, making us run across departments.
And all this add to our unnecessary costs and waste of time and energy.
There should a public grievance system, centralised and controlled by private/ media, not government.
Mrs. kulkarni | Wed Jun 25 05:09:54 2014
Mr Khosala, i totally agree with you. this becomes a national problem. but what my experience tells me that this is not happens only in government sector, it is happening in nearly every sector. Assume i am a career starter and want to start a new business with a status of pvt ltd. i could not even collect the information without paying somebody. there is no provision to check all the statutory compliance for the business i want to start. if i want to work any good/ big company, need to check the purchase officer and his requirements. then only i can understand the purchase process of the company.
even if i need admission for a KG in a good school, i need to bribe the clerk or someone to understand the process.
what i want to say is, we need to change the mentality of general people or a citizen. if we are going to try this, i am with you all.
Padmaraj Prabhu | Wed Jun 25 04:01:07 2014
Sir, There are thousand of private sector company, who pays bribes to govt official to get their business including police department, Guard Boards etc etc. They come to the office to get the money from the client. Present where i am working we pay handsome of money to get govt licenses, including police verification etc etc. We keep quite because we are concerned about our job and not business. Let owner do whatever they want.
Just in Time!
Himesh SHAH | Wed Jun 25 03:59:15 2014
Dear Mr. Bikky Khosla,
This editorial of yours as usual is just in time!
I have observed that corruption in business in India is several hundred times more than what we see in Politics. I have opted to not to practice corruption & am paying high price for it as it totally ruined my business. Still I am very much happy as I am not doing anything wrong.
I am not finding this problem when I export to western countries & hence I am concentrating on exports. The only thing which hurts me is that I cannot sell my highly quality products at reasonable rates in my own Country!
I am reading all your editorials & find them perfectly reflecting current situations, moods, conditions…
With kind regards,
Himesh.
5 Points Formula to
Pankaj Kumar Singh, Pune | Wed Jun 25 03:57:17 2014
1. Create Innovating & Rewarding Environment across PAN INDIA level
2. "View of Balance sheet" on website- mandatory of every companies/ NGO/ PSU/ GOI/ ATUONOMOUS BODY/ ORG etc
3. Amendment of "COMPANY ACT" & all allied laws which directly affect financial health of "COI"
4. Re-visit & re-vise all the pertaining laws which restrict "CHANGE & GROWTH"
5. Stringent follow-up & strategic mechanism to deal the issues with "CONTINUOUS IMPROVEMENT PROCESS" approach.
Thanks
reg corruption
M.Mohan | Wed Jun 25 03:41:46 2014
People those involve in corruption, ultimately, indirectly they are doing harm to the society, our Nation, including their wife and children, so corruption money which is in their hand spoil them, one fine morning India will come to unrest like IRAQ,
I am praying to Almighty on behalf of our proud nation, please induce their thought in Good way.
Simplification of industrial law and harsher punishment for officials needed
M G | Wed Jun 25 03:16:23 2014
There is no accountability for officials. A simple thing like renewal of factory license requires begging from inspectors. Unless these rules are changed or abolished there is no hope.
Paying bribes
Diptendra Sinha | Wed Jun 25 02:45:16 2014
Dear Sir,
Your write up is well appreciated. But I would like to know what help your organization can offer if things get stalled when we small businesses do not cough up speed money to certain licensing and tax authorities. I agree with you most of the companies like us do take great pains to keep things in order. As time is money in business can you offer us any solution?
Raise your voice against corruption
Dr.Raj Mohan | Wed Jun 25 02:13:45 2014
I have been conducting EDP programs for over 2 decades in various forums. In Tamilnadu, I took initiative to wipe out corruption in Commercial Tax Dept. With the help of EDP trainees, I made a representation to the Commissioner stating that these entrepreneurs are start-up and they cannot pay Rs.5,000/- to Rs.20,000 for getting CST and VAT registration. Even the officials were directed by top officials to check for the start-ups and not to get money for the issue of registration certificates. And also directed them to issue the RC quicker than the other applicants.
We could make a break through. The applicants were also made to write 'PMEGP beneficiary" or New Unit - "First time Entrepreneur". On seeing this, they take quick efforts to issue RC.
If we raise our voice against, it will definitely yield results.
Corruption free. India
Sudhir Sinha | Wed Jun 25 02:00:34 2014
Perhaps on line with no human interface could help.
Corruption.A curse for SMEs
Rupanagudi Ravi Shankar | Tue Jun 24 23:23:22 2014
What is stated in the article is 100% true. But let us analyse the problem. Corruption takes place in my opinion broadly in two ways. One to get the required approvals / letters from the governmental agencies/ officials and the second one while running the enterprise. The government officials while approvals etc., think that they are doing a favour to the entrepreneur by doling out the approvals etc.,. To save time and energy the entrepreneur is forced to fall into line with the officials. Otherwise you can never start the dream project of yours. Broadly this is how it is though we can discuss it in depth.
Now while running the enterprise you had it. You have umpteen rules and regulations and the entrepreneur certainly makes many mistakes without his knowledge and gets into the "wrong side of the law" and to wriggle out he is forced to pay the bribes. This also can be discussed in depth ie., the problems arising in running the SME units on a day to day basis.
As I see it the rules and regulations are too many and mostly common to big industrial concerns and to SMEs. Government has to separate the SME sector and big industrial concerns and form completely a modified and very much minimal simplified set of rules for SMEs and allow the entrepreneur to run the unit not run away from it. These are larger and broader aspects of legislation and we need to form a group and disucss the various aspects before we can conclude.
bribes
S S Sriraman | Tue Jun 24 23:16:58 2014
Even one is perfect has to pay bribes. Otherwise, the authorities will drag into litigation and one has to undergo severe legal battles spending money and losing peace. People simple bribe and buy peace. So long as you have out dated rules and laws, corruption is a remedy. I can write a book,the hardships / agony undergone for refusing to pay bribes.Money not only changes hand it changes people !!
Corruption: A curse for SMEs
Ravi Pailoor | Tue Jun 24 19:36:31 2014
In year 2000, I opened a consulting firm doing electronic design work. I used to have a 2 or 3 workers for cleaning the office and soldering.
My office was on a prominent main road and I had a board outside my office. I was registered under VAT and ROC.
In the year 2011, a labour inspector turned up at my office and demand my labour registration certificate (What was he doing all these years?). I had none. He told me to pay Rs. 3500/- as bribe or he would fine me Rs. 1000/ year amounting to Rs. 11,000/-. I had to pay the bribe as I did not have the time to run from pillar to post leaving my bread winning work.
Nothing further to say as rest of the things are well known.
My fault was that I did not go to all the government offices (how many were there or are there to obtain permission from) to find out if any license or permission was needed to run my company.
Ravi
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