This article appeared in Forbes India Magazine of 11th
February, 2011
Surely welcome news.
Finally, light at the end of the tunnel.
Bribeless In Bihar
Bureaucrats in India's most corrupt state are facing the heat from their own
chief minister
Raghuvansh Kunwar could not believe it. For the motor vehicle inspector
based in the Aurangabad district of Bihar, the news item in the Hindi daily
was more chilling than the December morning. The government was going to
throw him out of his house and start a school there. The announcement was
made by Bihar's human resources development minister, P.K. Sahi, at a public
meeting.
"I was shocked to read the news item,'' says Kunwar in a tone that barely
conceals fear. "I have lived in this house for 20 years with my wife,
children and three brothers and suddenly I was being told to hand over my
house."
The vehicle inspector did not realise then that he was the first
prey caught in a new anti-corruption drop-trap devised by
the state government and hailed as a model for other states
to follow. Kunwar had been booked under a new law allowing for summary
confiscation of property of government officials found to be having more
assets than their income justified.
The state vigilance department, the government's internal
watchdog, had found in 2008 that Kunwar owned property
worth Rs. 54 lakh but was unable to explain how he could
afford it. The department has lined up 18 more such cases to
confiscate property valued at Rs. 21 crore before the special
courts created under the new legislation, the Special Courts
Act 2009. It is reviewing another 87 cases for possible
confiscation of assets.
Kunwar's case was the first headline-grabber from the
Nitish Kumar regime that returned to power with a resounding mandate that
many say was an endorsement of the chief minister's reputation as a leader
with a cause. In its first innings, the administration locked up 54,000
people in a bid to break the criminal-politician nexus that had plunged
Bihar into such an anarchic mess - a place that everybody knew where it was
but nobody wanted to go, even those who had fled from their 'native place'
for greener pastures. The third axis in the unholy nexus was the government
official for whom the general public is the golden goose.
Blunt Axe No Good
It was not that Nitish Kumar avoided them in his first term. His attempt was
to hit all three simultaneously, though the
babudom - cocooned in rules and procedures - turned out to be the most
resilient. Kumar set up a Special Vigilance Unit (SVU) in 2006 to go after
the big fish in the government. It was a crack team of former Central Bureau
of Investigation (CBI) officials with a separate headquarters on the rather
quirkily named Serpentine Road. The unit soon made
headlines as it caught several senior government officials such as a police
chief Narayan Mishra and state drug controller
Y.K. Jaiswal, with enough wealth to finance the annual
budgets of entire villages. State vigilance squads trapped
about 400 government officials in the next four years. However, much of it
came to nothing as only two of them have been convicted so far. News reports
suggest that even the elite SVU managed to file only five First Information
Reports (FIRs) in four years.
Meanwhile, Nitish Kumar was regularly besieged by villagers
with tales of corruption on his frequent countryside tours. In
Bihar, big ticket deals are few. The corruption that is endemic is petty.
For the general public, it is difficult to get government certificates and
entitlement documents without paying touts.
Unlike big deals where money is often received and stashed in numbered
accounts in safe havens or as stocks and bonds,
in Bihar the nature of corruption is localised. Ill-gotten money hardly
leaves the country and is invested mostly in real estate or gold. That means
empowered officers can easily help track it down.
A vigilance officer pointed out the case of a milk-vendor in
Patna. The man is said to own a dozen cars, wealth that he
acquired by laundering money for government officers and
politicians. "Most government departments have their own
paan-wallahs, ice-cream vendors and traders who act as
collectors for the babus," says the officer who did not wish to be
identified.
Bureaucrats who own black money typically invest it in real
estate projects outside Bihar; Bangalore and Noida are
particular favourites. But junior level officers such as block
development officers, panchayat members and clerks keep
their cash in bank accounts and lockers apart from building
houses in their village. Having cash stashed in the mattresses
also helped if they got caught. They could use the same money to pay off
investigators and the game could go on.
It was clear to Nitish Kumar that merely catching a culprit was not enough.
A major handicap was that under the Prevention of Corruption Act, vigilance
officials had to get clearance to prosecute an errant bureaucrat from his
own department. That took time. He realised that the only way to deter
corruption was to take away the wealth itself - ASAP. Kumar put his then
attorney general P.K. Sahi on the job. (Sahi would go on to become Nitish
Kumar's minister in the second term).
After consulting experts and studying the provisions of the
Prevention of Corruption Act, Sahi prepared a draft bill by the end of 2008
and it was passed by the Bihar Assembly in
February 2009. It then languished in the union home and law
ministries for a year. The delay often prompted Bihar politicians to snigger
that the Centre did not want Nitish Kumar to have one more feather in his
cap. "The Centre kept asking for one clarification after the other. The
delay meant that we could not swing into action before the state elections
and the CM himself had to repeatedly follow-up with the Centre,'' says
Sahi.The Bihar Special Courts Act, 2009, was eventually signed into law by
the President in March 2010.
Slash And Burn
The Bihar law is not a pioneering one. That credit goes to
Orissa, which passed a similar law in 2008 and also set up
two special courts. However, it was challenged in court and until recently
its validity was uncertain.
In Bihar, the Act comes into play when investigating
agencies are convinced that an official owns assets in excess of his known
sources of income. Now, even as it pursues a
corruption case against an official, the state separately
seeks to take control of the assets owned by the person. Bihar has set up
six special courts that exclusively deal with this.
The vigilance department files a declaration with a special
court that the target has amassed unexplained wealth. The
special courts then conduct speedy trials and decide within
six months whether the property should be confiscated or not. The property
would be returned with interest (at 5 percent annually) if the person is
acquitted.
The Prevention of Corruption Act does not provide for
attachment of property and instead has a provision enabling a
judge to also impose a fine depending on the value of
the ill-gotten property.
Former CBI director Joginder Singh says the nation should
follow Bihar. "If the property of the accused is confiscated in
advance, it will make a huge difference. This will help serve as a deterrent
to officers and also ensure that the accused are
not able to influence investigations using money," says
Singh, who has investigated several high-profile cases of
corruption, including the fodder-scam in which Lalu Prasad
Yadav was prosecuted.
A.K. Chauhan, principal secretary, vigilance, says that he has
not come across any instance of politicians or high-level
officials trying to influence a case. "They know that we report to the CM.
So there has not been any attempt so far," says Chauhan, who has earlier
worked as secretary for co-ordination in the state cabinet and is considered
to be someone who enjoys the chief minister's trust.
"MLAs have also been warned that they should not call up
officers directly and try to influence these cases. The Chief
Minister has made it clear within his own party as well that
he will not tolerate anyone trying to influence the officers,"
says Rajya Sabha member Ali Anwar, who is considered to
be a close confidant of Nitish Kumar. The results are yet to
show, but the tremors are already being felt.
Of course, the law has been challenged in court. Narayan
Mishra, the police chief booked by the SVU and facing
confiscation of property, has moved the High Court arguing that the law is
unconstitutional. "It is a draconian rule with no
regard for constitutional rights," says Mishra.
Lawyer Abhinav Shrivastava, who represents six officials
who have challenged the validity of the Act, says the main
problem with the legislation is that there is no laid down
procedure to decide which cases under the Prevention of
Corruption Act would be transferred to the special courts for
attachment. "This would make the entire process subjective and arbitrary,"
says the lawyer.
A state bureaucrat, who spoke on condition of anonymity, said that there was
palpable fear among officials after the
government lined up cases for confiscation of property. "The
officers are in fear of a crackdown and that is good for the
health of the system," he says.
Hindi daily Prabhat Khabar reported that over Rs. 100 crore
had been withdrawn from banks in the capital, Patna, in
the fortnight following the confiscation of Kunwar's property. A top bank
official confirmed that there has been an increase in withdrawals from bank
branches across the city but was
unsure whether panic-driven officials were behind
the trend.
The state capital, which had acquired a reputation as a
crime-hub during Lalu Prasad's regime, also gained a reputation for scams
and middlemen as Bihar led the list of corrupt states in almost every survey
carried out between 2000 and 2005.
Renewed Growth
Nitish Kumar's two terms, when he first re-established law and order and
then began weeding out corruption, have brought new hope to Biharis in the
state and those living outside.
For long, Patna seemed to be relatively untouched by India's
economic transformation. There are no glitzy malls or
international brands that embellish the other cities. There are no hip
eating joints or clubs. There is no evidence of any sort of nightlife or
even entertainment for families.
But the city is changing, slowly. Women move about
fearlessly in areas where they would not have dared to
venture out just a few years ago. People come out for
shopping and socialising. There is a clear buzz of a
consumer economy blooming.
The story of change is particularly evident in the new
apartment buildings springing up across the city. Real estate
developer Narendra Kumar says that property rates in
Patna are comparable to rates in Noida as there is a huge
demand and there is shortage of land.
"The boom is not entirely fuelled by black money and there is a genuine
increase in demand," says Kumar, who has built and sold over a dozen
apartment complexes in the city in the past three years. He says most of the
money coming into
construction is from people of Bihari origin who live outside
the state but are now beginning to hope for a prosperous
Bihar.
Academician Shaibal Gupta, considered an expert on
governance in Bihar, says tough times are ahead for
bureaucrats. Next the state is planning to enact a Right to
Services law to ensure efficient government service.
Officials will be punished for failure to provide time-bound
service.
"There is a lot of pressure on the bureaucracy now like never
before," says Gupta.
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