Corruption has nothing to do with liberalisation: PM

Combating governance failures is a more complex challenge for the country than the techno-economic challenges it face now and this must be addressed if the country is to preserve its growth ambitions, Prime Minister Manmohan Singh said today.

Speaking at the golden jubilee celebrations of the Indian Institute of Management, Calcutta (IIM-C) in Kolkata, the prime minister also defended the government's economic policies, saying economic liberalisation has nothing to do with corruption.

On the contrary, he said, a demolition of the Licence Raj has only helped free the economy of rampant corruption.

"Many of the areas which have actually seen systemic reforms have also seen the disappearance of corruption. Industrial licensing, import licensing and rationing of foreign exchange are good examples. These areas were earlier associated with widespread corruption. The abolition of licensing has eliminated corruption in these areas," he said.

He said liberalisation, however, has not helped to cleanse the system as corruption surfaces in varied forms.

"The common man faces corruption when he has to pay a bribe to facilitate ordinary transactions with government. Beneficiaries of government programmes face corruption when those in charge of implementing the programmes misappropriate funds…. Large government contracts can breed corruption when procurement procedures are inadequate," the prime minister said.