Trusting our businesses

A key indicator of a development society is the level of trust the government places in its citizens, businesses and institutions. The trust, or the lack of it, is evident in governmental systems and processes.

Mandatory document attestation for any paperwork, a frequently asked requirement, is an example of mistrust. Example of distrust is the extensive, often irrelevant information sought during applications, based on the presumption that applicants may be hiding something.

Multiple layers of oversight also reflect distrust in employees’ ability to perform duties honestly and competently. The emphasis on processes over outcomes is rooted in a belief that individuals cannot act ethically and effectively without strict guidance and supervision.

Trust enhances efficiency, reduces regulatory burdens, and improves societal well-being. Trust-based systems cut down on paperwork, oversight layers, and red tape, lowering administrative costs and allowing governments to invest in growth and innovation. Trust encourages voluntary compliance and calculated risk taking, fostering innovation and adherence to regulations through a fair and transparent system.

The British colonial administration relied on suspicion and control to suppress local dissent and maintain dominance. Since independent India’s rules and procedures were based on British systems, this culture of distrust has not only persisted at both the central and state levels, but it has intensified.

After independence, when Indians took control, they brought with them a mindset shaped by two centuries of colonial rule. Acculturated to distrust, they perpetuated and amplified this mistrust. This legacy led to an environment where procedural compliance often overshadowed genuine outcomes, even at senior leadership and bureaucratic levels. As a result, cumbersome regulatory frameworks, extensive paperwork, and multiple layers of oversight have emerged. These layers include internal and external audits, vigilance cells, anti-corruption bureaus, parliamentary commit tees, Central Vigilance Commission, Central Bureau of Investigation, Lokpal, Lokayukta, judicial bodies, sectoral regulators, Right to Information Act, and more. These layers, aimed at accountability, reflect deep seated distrust, in the employees and even in the over sight mechanisms. This distrust has further accentuated the prioritisation of procedures over outcomes.

Major fraud in some big business has further fueled mistrust, resulting in a complex and cumbersome regulatory system.

Under the Narendra Modi admin- istration, the government began implementing significant reforms to build trust with its citizens. Affidavits were replaced with self-certification, and many attestations by Gazetted officers or notaries were eliminated. Application forms were streamlined to one page, and the India-stack Open API architecture reduced redundant data requests.

Ajay Kumar