Corruption: A curse for SMEs

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 onour 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.

-Trade India