How Indian Politicians Remain Wealthy Despite The Country’s Poverty

How Indian Politicians Remain Wealthy Despite The Country’s Poverty


All around the democratic world, the issue of money in politics has to be addressed immediately. The problem of money in politics, as well as the illegality, quid pro quos, and murky dealings that frequently come from the urgent search for campaign funding, are not new to India. Unfortunately, like in most of the developing world, the relationship between money and politics in India has not received consistent scholarly study.

This is more due to a lack of information than a lack of interest. There is a bigger chance in Indian politics that the fastest way to gain money is by entering politics. This perception stems from the blatant corruption of some of our top political figures. Therefore, many who could have chosen a career in crime are increasingly choosing to pursue careers in politics.

Generating White Money By Indian Politicians

Current Prime MinisterNarendra Modi
Polity TypeFederal Parliamentary Republic
ConstitutionConstitution Of India

When elections were approaching, politicians utilized businesspeople to generate money for their campaigns. Politicians first became unofficial business partners before emerging as successful entrepreneurs who own real estate, schools, and other service-related companies.

The most ingenious of their strategies, however, has been to establish shell corporations whose shares are sold to business people at a staggering premium (per share), guaranteeing that our netas’ riches are carefully laundered and perhaps taxed. It is not necessary to hold a Benami. It is entirely legal and in the color white. Those who invested in these sham firms received vast parcels of land, mines, and concessions in exchange.

In 2004, 30% of the lawmakers serving in the Lok Sabha were crorepatis (that is, their self-disclosed assets totaled at least one crore). By 2014, that percentage had increased to 82%. The data show a significant wealth premium in elections; among the 21,000 candidates running in the previous three general elections, the wealthy 20% had a twenty-fold higher chance of winning than the poorest 20%.

The more affluent of the two candidates have a distinct advantage, even among fiercely competitive candidates. The results of surveys conducted in north India show that elected officials, from panchayat presidents to MPs, rely heavily on their funds.

Private Sector Role In Funding A Politicians

How Indian Politicians Remain Wealthy Despite The Country's Poverty
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However, there is a prevalent belief in India that giants of industry control this sector. The majority of the activity occurs among medium-sized businesses and entrepreneurs who depend on routine government permissions. According to research based on the report, there is a connection between state-level legislators and construction companies working in the real estate and building industries, where the government has a well-established.

Moreover, there is evidence that politicians assist builders in navigating the maze of land-related regulatory clearances in exchange for financial contributions during election seasons.

 Even if the origins of political funding may be mysterious, most of the money is spent on unimportant things: paying attendees who attend meetings as compensation. Of fact, especially at the state and federal levels, private sector money frequently supplements a politician’s resources.

So even while the origins of political funding may be secret, most of the money is spent on everyday things like paying supporters for meetings, paying the salaries of political staff members, and paying for meal costs incurred during the campaign sprint.

Significance Of Money For Politicians In Controlling Nation 

How Indian Politicians Remain Wealthy Despite The Country's Poverty

The role of money in democratic politics will never change. But it’s essential to keep in mind why the growing costs of democracy are so concerning: it’s not only the importance of the money at stake but also the broader effects that money may have on political behavior. For instance, money’s “selection impact” on candidates for office is significant. As one of us has shown, the rise in the number of candidates with criminal records is visible.

Quid pro quos in the formulation of policies are also encouraged by fundraising from supporters. Growing inequality is a result of rising election expenses. Most significantly, a sense of legitimacy regarding the process and the presence of a fair playing field are at the core of every functioning democracy.

Politics Of Creating Wealth

Most political families today have at least one business whiz kid who, for no apparent reason, produced vast sums of money for the rest of the family. But unfortunately, stolen cash is more difficult to track once it is put into a business endeavor than it would be if it were invested in an apartment in the same building.

  • The government spends and expenditure is done on a lot of money on infrastructure, medical care, social welfare, education, and other areas, and there are always open bids. All those tasks are carried out by the administrative machinery, which frequently receives a commission from the contractor in various areas. It is believed that a minimum reduction or percentage of 10% is granted in civil works. Gold coins are stolen in several locations. The same thing is occurring in other areas as well. If one is willing to take the chance that the bridge or road would be destroyed after it is built, the savings could be more significant.
  • Politicians will fund all of their costs through taxes, which the general populace will pay. Second, when they get a package to help them build their constituency, they may keep a substantial portion of it for themselves while spending some of it on others. Third, it’s conceivable that they accept payment from businesspeople in exchange for doing their task. The primary funding source for political parties of this kind is electoral bonds. Political parties receive donations in the millions of rupees.
  • The acquired riches are pretty obvious, but an investigation only occurs after a complaint is made or the current government is dissatisfied with that person, leading to his eventual imprisonment after much work. These individuals are so powerful that they frequently receive bail as well, are released, and then relaunch the same campaign with much more vigor. They have no regard for the general public or the system and consider everything they do to be part of it. For them, there are no strict laws.
  • Ministers, MLAs, and MPs can choose political secretaries and assistants. They get compensation from the government, a pension, and other perks. There are many hundreds of such appointments in a single period. The board members and chairpersons of various corporations, as well as brand-new ones, are accommodated for those who did not win election seats and failed or elderly politicians. They get salaries on par with ministers. They can influence and make appointments. Thus, the academic and employment sectors have become wholly politicized.


The day when leaders like Gulzari Lal Nanda, Morarji Desai, and Kamaraj led the country with their austere lifestyles and refused to campaign since their lives were an open book for voters to judge whether to elect them or not is long gone. However, modern politicians have the money to spend more to purchase votes and the cleverness to find a method to double or treble those votes. Politics is undoubtedly a game of manipulation, and those with the talent for developing new initiatives that result in quid vid quo revenues are the victors. Unfortunately, we have witnessed several corrupt politicians among us.

What are India’s leading political issues?

The political climate of the Indian country is significantly impacted by critical concerns, including terrorism, Naxalism, religious violence, and caste-related violence.

What is the Indian MLA’s salary?

The compensation of lawmakers in the national capital will rise from the existing monthly wage of 54,000 rupees, including monthly payments, to 90,000 rupees with the proposed increase.

 What are the primary reasons behind India’s poverty?

Poor agricultural practices, a rising population, the gap between the affluent and the poor, corruption, and black money are the main factors contributing to India’s poverty.


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