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Monday
Jan282013

Cleaning up the Indian environment

A senior bureaucrat in India’s Ministry of Environment and Forests (“MoEF”), Neeraj Kumar Khatri, has been arrested for allegedly accepting a bribe of about $13,000 for unspecified assistance with a ministry hearing on an environmental clearance.

Khatri, a deputy director with the MoEF, allegedly was caught by India’s Central Bureau of Investigation, India’s premier investigative police agency, accepting the bribe and possessing an additional $185,000 in unexplained money. An official at the MoEF has promised its own investigation.

The arrest could signal a welcome attempt to cleanup India’s notoriously opaque system for environmental clearances. Infrastructure, real estate and industrial projects are some of the typical investments that require such clearances. Both Indian and foreign companies have suffered greatly through an often non-transparent and contentious process for environmental clearances.

Simply obtaining a hearing on an application can reportedly require unofficial negotiations. A justifiable lack of public faith in the environmental review process, stemming at least from the Bhopal disaster, has resulted in often counter-productive protests that have blocked important economic development projects for foreign and domestic companies alike.

Environmental watchdogs and the business community will be watching the fallout from the Khatri arrest to see if there will be a real effort to take the green out of the environmental approval process.

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Russell A. Stamets is a contributing editor of the FCPA Blog.

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