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overview: India Anti-Bribery and Anti-Corruption Regulations

Published on : 31 Jul 2019

India Anti-Bribery and Anti-Corruption Regulations



India is a crucial country from a global perspective and is one of the largest economies in the world. The growth is also significant with the nation projected to climb further up the worldwide economic ranks in the coming years. Further, the country is the second most populated in the world, with over 1.3 billion residents. With it being such a vast nation, there are many things which must be taken into account from an economic and political perspective.

One issue which India has unfortunately become known for relates to the level of corruption that occurs. Considering that it is among the most significant of economies in the world, it is ranked at number 78 in the global ranking, though this position is also one which was worse in the years past. Bribery is also a concern, though it generally falls under the branches of corruption.

The issues that this gives rise to are severe and numerous. Corruption significantly impacts the development of the nation and its economy overall. When considering just how rapid the growth currently is, the countries position could have been even higher among the ranking than it is.

Corruption is an issue that many governments have had to combat through the ages; it is something that will likely always exist. However, a vital step to preventing and limiting it is to ensure the legislative structures in place considers the possibilities and provide repercussions which can receive enforcement through the appropriate means.

India has successfully introduced regulations in recent years attempting to achieve just this. When considering its recent climb up the global index, there are certainly improvements which can be felt and calculated. If the nation manages to stem the flow of corruption and bribery significantly enough, the results in terms of economic development will be highly visible. The country will propel forth at a rate unseen before the improvement, which can only be seen as good for India.

The current regulatory structure of India will receive exploration and analysis here, and the potential future of the country will also be looked into and explored.

The Original Preventative Regulation

The original regulation which originally concerned or discussed bribery and corruption was the Indian Penal Code. This law forbade the providing of bribes to individuals and also forbade officials, public servants and those in certain positions of power from accepting valuable gifts.

The Indian Penal Code was enacted initially in 1860, making a significantly old regulation. It was also a regulation which did not adequately manage the concept of bribery and corruption either, as the issue is still prevalent to this day.

The reason the law was this ineffective at tackling the matter was that it was a substantial regulation covering all aspects of criminal law in the country. As such, only a small section related to the topic at hand. To truly tackle the issue head-on, a specific regulation related to anti-corruption and bribery needed to arise. That is where the POCA came in.

Prevention of Corruption Act (POCA)

In 1988, the Prevention of Corruption Act (Act Number 49 of 1988) received its introduction in India to put the brakes on corruption and allow the nation to break free of the shackles. It also aimed to allow for more considerable progress towards more clean and rapid development. To this day, it is the primary law on the matter, though there have occurred amendments during its 31 years of effectiveness. The most recent of these amendments arose in 2018, and all of this shall receive discussion ahead. Further to this, the regulation shall receive a close look from an international perspective, and the effect shall be sifted through thoroughly.

Thus, to begin with, the regulation relates to public servants. These are individuals who are often most approached due to their positions and responsibilities, with bribes. This concept receives a definition under Section 2C of the POCA. However, they are not the only group of people, and as such, it would initially seem as though the regulation is lacking. However, there are certain additions here.

The case of Central Bureau of Investigation, Bank Securities & Fraud Cell v. Ramesh Gelli and Ors, which occurred in 2013, specified a new party which would fall under the umbrella of a public servant. India has a hybrid legal system which is somewhat between the civil and common law types. However, overall, it relates more closely to the common law system, and as such, case laws play a crucial role in deciding court outcomes. This specific case occurred in the Supreme Court, the court of the highest power in India, and as such, its decision is law.

The case itself concerned banks and their CEOs. The decision was reached that such individuals fall under the category of a public servant and therefore are not allowed to receive bribes from any individual or organisation. The case judgement mentions any individual who holds office through which they perform civic duties, should fall under the category bank CEOs do indeed.

The methods that constitute a bribe are as follows:

  • Anything that could give rise to undue advantage for one party over another would constitute as such; this could include financial gain, though;
  • This matter was initially the case. However, any form of undue advantage is now also specified and covered by the law.

A case which relates to this is that of K.M.Subramanian v State of Tamil Nadu Rep in which the defence party was accused of accepting a bribe. They were considered a public servant and received gratification beyond what is allowed. The only type of gratification permitted is remuneration only. As per the POCA regulation, they were found guilty beyond a reasonable doubt. An appeal was attempted, though the idea dismissed.

However, once again, this does not cover the entire picture. The public sector entities feel the effects, though private companies do not fall within the law’s boundaries. Compared to many other nations, this is a significant disadvantage as the law only covers a proportion, all be it an essential portion of the overall economy.

Until more recently, the regulation had a further issue. While the receiver of the bribe has and always will receive punishment as per the law, the individual who provides the inducement could only be penalised for the act of abetting the receiver. As such, the act of giving a bribe was not overly risky.

Amendments to the POCA through the Years

2018 brought about some crucial changes to the POCA regulation. One fundamental change relates to the issue as mentioned earlier concerning those individuals who provide bribes. As of the amendment, these individuals can be criminally prosecuted rather than being prosecuted as an abettor to the situation. This change offers significant repercussions for the other side of the bribery situation and will likely reduce the rates of bribery by merely making the risk far greater. If one is found to be guilty, they can receive up to seven years of jail time.

Further, commercial organisations will also be liable in the cases where they or an individual from within is found to provide bribes. Any individual in a position of power in those commercial entities will also be liable to receive prison time and a fine.

Another aspect that has seen an amendment relates to property that is attached to the bribery situation. It is now easy to connect said property to the claim which was not possible in the past though this regulation but rather through the likes of the anti-money laundering law. This change will simplify the processes which are necessary to help optimise the rules and their enforcement.

Finally, the amendment Bill requires that such cases are brought forward as soon as possible and should receive their judgements within a period of two years.


India is not in an ideal place when it comes to corruption and also global perceptions of corruption and bribery. There is certainly an issue in the country, though regulations and changes have arisen in more recent years to combat the problem.

Arguably the biggest concern for India is that they are among the largest and fastest developing nations in the world. Currently the number 6 largest economy and projected to move up the ranks in the coming years, and with one of the most significant global populations, there is, this growth is none the less being severely hindered.

Changes are coming, though, and the regulations that are currently in place have risen because the issues are known. The only matter now is to find the appropriate solutions for which the government is hard at work. There are also definite signs of progression with the global index of corruption ranking on a steady and continuous rise. The recent 2018 amendment Bill also brought about changes as previously mentioned to further the goal of a corruption-free India.