Construction, real estate, telecoms seen to be most corrupt sectors
15 March 2011
More than 50 per cent of respondents in a survey of Indian corporates felt that the real estate and construction and telecommunications sectors were the most prone to corruption.
Other sectors featuring high on the list include social development (education and poverty alleviation), financial services, defence, IT/ITeS/BPO and energy and power.
But very few of the respondents in a survey by KPMG Forensics, part of the international consultancy, felt that sectors such as media, consumer goods, heavy engineering, pharmaceuticals, healthcare and – surprisingly – transport and logistics were prone to corruption.
''Through this survey we have tried to find the concerns, apprehensions and the challenges faced by different sectors and have also laid stress on various steps that have to be taken immediately to restore confidence in the Indian economy,'' said Deepankar Sanwalka, head, risk and complince group, KPMG India. ''This survey is crucial as the global business fraternity is closely watching what is happening in India.''
According to Rohit Mahajan, executive director, forensic services, KPMG India, ''to make this survey a comprehensive one, we have ensured that all major industries are covered. All the participating corporates were keen to be part of this survey and expressed their concerns about the state of affairs, which they believe has major implications for the business environment in one of the fastest growing economies in the world.''
Interestingly, 68 per cent of respondents believe that India can achieve more than the projected 9 per cent GDP growth if corruption is controlled. But 51 per cent of the respondents fear that rising corruption will make India less attractive for foreign investment. And 90 per cent of respondents felt that corruption negatively impacts the performance of stock markets by increasing volatility and prevents institutional investors from making long term investments.
An overwhelming 99 per cent of the respondents felt that the biggest impact of corruption on business was its tendency to skew the level playing field and attract organisations with lesser capability to execute projects. Surprisingly, 68 per cent of respondents believe that in many cases corruption is induced by the private sector.