Saturday, December 31, 2011

Lokpal and its implications for India’s growth

How a company is monitored
In the era where a new scam is unveiled every other month, the need for an ombudsman is critical. The reasons why it is necessary for India are: one, it will adopt the role of the auditors to the government and two; it will help imbibe the concept of Corporate Governance in the Indian Polity. For long, investors have stayed away from Indian markets due to the bureaucracy and corruption embedded at each level of the system. Good governance will bring stability and transparency; attracting foreign investors to our market. Lokpal will act as the auditor, providing relief from the pervasive corruption and make the government more accountable to the public. Little is divided between the Satyam Scam and the Common Wealth Games Scam as both have led to an enormous loss of the public’s hard earned money. Thus, the demand for public accountability of the bureaucrats and the government that manage public resources has become more evident. Taking the case of a Business scenario; we have the company, its shareholders, directors, internal auditors, external auditors and above all the Securities Exchange Board of India.

When compared with the political scenario; we have India as the company, Indian citizens as its shareholders and the Government as the directors. Here, the role played by SEBI and the auditors is not in play. This is where the Lokpal comes into picture. The Lokpal is required to fill in this gap. It has to fulfil the duties performed by SEBI and the auditors, but in the political scenario. It has to play the role of an auditor to the Government.

Likewise, how a country can be monitored
According to this analogy, Lokpal assumes the responsibilities of the government’s auditor. It is Lokpal’s duty to ensure that the country is run properly. The government assumes the role of the Directors. Their duty is to carry out the demand of the shareholders, i.e. the citizens of India, without thinking of personal gains. Today, the role played by SEBI and the auditors is vacant. Lokpal is required to realize this role. In conclusion, it can be said that India’s growth has been hampered from many a years to the malice called corruption. Lokpal may not be the cure of all ill, but it is indeed the best start that the movement against corruption can get and is highly recommended.

Arfa Shaikh | Guest Editor

1 comment:

  1. Thanks for giving me a chance to read your article. This is very helpful to us.