There are many ways to read a letter. More so if the writer is our Ambassador to the US Meera Shankar, and if the letter’s contents detail seven “instances” in which US companies bribed Indian officials.

The CPM politburo has chosen one way to read this letter, highlighting the nationality of the bribe-givers and focusing on how the situation is against “India’s national interest”. But what the October 13 politburo statement does not mention is where Ambassador Shankar got those details from. Her accusations are not the consequence of any Indian probe, but the result of a strict US law which pertains to American companies that bribe foreign officials.

The Foreign Corrupt Practices Act (FCPA), enacted in 1977, prohibits US companies from making “corrupt payments to foreign officials for the purpose of obtaining or keeping business”. The law is robustly enforced by two agencies that work in tandem. While the anti-bribery provisions of the FCPA are enforced by the Department of Justice, auditing requirements — to detect irregular fund transfers in the form of bribery — are in the hands of the Securities and Exchange Commission (the American counterpart of SEBI). Punishments range from fines to jail sentences. It is these enforcement agencies that have found evidence of wrongdoing by US companies in India. Ambassador Meera Shankar’s letter merely refers to their report.

India has no equivalent law that prohibits its companies from bribing foreign officials, let alone the kind of sophisticated enforcement mechanism that the US has in place.

... contd.