66% Businesses Paid Bribes in 2024: LocalCircles Survey Reveals Shocking Trends

A recent LocalCircles survey sheds light on widespread bribery among businesses in India. The findings indicate that 66% of firms paid bribes over the past year, with legal, food, and health agencies topping the list of corrupt departments.

Bribery Trends Among Businesses in 2024

The survey, conducted across 159 districts with 18,000 responses, found that:

• 54% of businesses were forced to pay bribes due to extortion-like practices.
• 46% voluntarily paid bribes to expedite processes like permit approvals and compliance checks.

These practices remain entrenched despite advancements in digitalisation and efforts to modernise government operations.

Key Reasons for Bribery

Businesses reported paying bribes for:

• Qualifying as suppliers.
• Securing quotations and orders.
• Obtaining permits and compliance certificates.
• Processing payments from government departments.

This indicates that corruption has become a systemic issue in various government functions, impacting business efficiency and fairness.

Departments Implicated in Bribery

The survey revealed that:

• 75% of bribes were paid to officials in legal, food, drug, health, and metrology departments.
• GST, pollution control boards, municipal corporations, and power departments were also frequently mentioned.

These findings highlight how corruption spans across critical regulatory and compliance agencies.

Impact of Government Initiatives

While initiatives like the Government eProcurement marketplace aim to reduce corruption, loopholes remain. Businesses cited manipulation in supplier qualification, bid processes, and certificate approvals as persistent issues.

Decline in Bribery Transactions

Interestingly, the survey noted a decline in the number and aggregate value of bribery transactions in 2024. This could be attributed to increased awareness and the implementation of digital tools, but the underlying issue of corruption remains unaddressed.

Challenges in Combating Corruption

Despite digitalisation, bribery thrives behind closed doors, often away from CCTV surveillance. Many businesses feel compelled to participate in corrupt practices due to systemic inefficiencies and delays.

Need for Robust Anti-Corruption Programmes

Experts like Deloitte India's Partner Aakash Sharma stress the importance of stronger compliance frameworks. Businesses need to go beyond minimal compliance to avoid regulatory scrutiny and ensure ethical practices.

Sharma emphasized that the changing regulatory landscape demands robust anti-corruption programmes. Organisations must reassess their policies and establish transparent processes to curb bribery effectively.

Solutions to Combat Bribery

1. Digital Transformation: Increased digitalisation in government processes can reduce opportunities for corruption.
2. Strict Enforcement: Regulatory bodies must ensure penalties for corruption cases.
3. Awareness Campaigns: Educating businesses on anti-corruption laws and practices can encourage ethical behavior.
4. Streamlined Processes: Simplifying compliance and permit procedures can reduce the need for bribery.

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