Elections have started in India spanning few weeks and as per one global index, the risks of political violence have considerably reduced as compared to other countries. As for example, in China the terror attacks are rising and it is becoming a concerning factor for potential investors in the country.
CPV Index 2014
Maplecroft, which is a risk analytics company in London, has created Conflict and Political Violence Index for the current year and according to it, India is at the eighteenth place and considered a very high-risk nation for doing business. However, India’s position has improved in comparison to 2011 when it was at 9th place and was considered extreme risk country in a study that consisted of 197 countries.
According to Maplecroft’s main political risk analyst the reasons for this improvement are reduction in Naxalite attacks that had surged during 2009-2010 time period and arrest of main leaders of many terrorist groups such as Indian Mujahideen, which has reduced capacity of these outfits to launch attacks on common people.
Integrated Action Plan – IAP
It remains to be seen if these positive changes can be sustained. Few things on which future developments will depend include development initiatives in areas affected by militancy and implementation of IAP, which stands for Integrated Action Plan. IAP will make militancy less appealing by facilitating betterment of economic situation in these regions after it is started in some of the nation’s Red Corridors to reduce local assistance for Maoist activities. This Red Corridor consists of states such as Madhya Pradesh, Andhra Pradesh, Uttar Pradesh, West Bengal, Chhattisgarh and Odisha.
Most Conflict Ridden Nations
According to statistics countries like Pakistan, Iraq, Afghanistan, Syria and South Sudan are considered most risky to do business at. But it is a concerning fact for investors that there is rise in conflicts in many parts of the world from Arab Spring to Ukraine and also in some of the leading countries which are moving fast on the growth chart like Thailand, China, Turkey and Nigeria.
If we look at China, country has moved up 5 places in the index in just about 6 months because of increase in fatalities caused by terrorist attacks instigated by Uighur separatist group. According to analysis, the countries that have seen significant rise in risk are the ones where there has been political turmoil in the last few years causing disruption of civic life.
To conclude we will say that India and many other countries are facing violence and terrorism. The governments have to look into it find a solution so that investors can freely invest in development initiatives without fearing anything.
