Indian Brand of Crony Capitalism

Abstract

One of the most serious issues that Indian businesses and economy confront today is that of ubiquitous corruption and cronyism. The cancer (or diabetes) of corruption/cronyism is debilitating the Indian society by unleashing a state of lawlessness. While corruption/cronyism has engrossed the entire society, scholarship on the topic remains conspicuous by its absence. Because of the lack of any systematic research and analysis, the understanding and discussion of the complex and dynamic phenomenon of cronyism/corruption has remained quite superficial, which is not helpful in devising effective remedies of the problem.

In this paper, I attempt to fill this gap by discussing the “nuts and bolts” of the problem, which consist of Indian political culture based on sycophancy and loyalty, Indian economic philosophy that has relied upon a unique hybrid model of socialism and capitalism, deep-seated Indian social/cultural values that emphasize ascription over achievement and emotionality over rationality, elite and out of touch Indian civil services with unfettered power, and the dominance of Indian economy by few family oligarchs resulting in one of the most skewed income distributions in the world.

Keywords: corruption, cronyism, crony capitalism, India