Security concerns make India 'extreme risk' economy

Discussion in 'Economy & Infrastructure' started by LETHALFORCE, Feb 27, 2011.


    LETHALFORCE Moderator Moderator

    Feb 16, 2009
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    LONDON: India and four other countries have been bracketed as "extreme risk" growth economies by global risks analysis firm Maplecroft citing security concerns.

    The UK-based firm's Global Risks Atlas 2011 has rated security as a primary concern for investors in high risk growth economies of India, Indonesia, Nigeria, Philippines and Russia.

    "India is rated extreme risk for security as it faces simultaneous threats of terrorist attacks from militant Islamic extremists and Naxalite Maoist insurgents," Maplecroft said.

    The report, covering 175 countries, focusses on seven key global risk areas including security, governance, climate change and societal resilience, including human rights.

    "... with the Philippines (8), Russia (10) and India (11) rated extreme risk and Nigeria (12) and Indonesia (28) considered high risk in the 'security risk category, politically motivated violence and terrorism must now be a primary concern for investors in these territories," the firm noted.

    According to the report, despite good growth, India has a poor human rights record and large sections of the population lack access to basic social infrastructure such as education, healthcare and sanitation.

    "This reduces the country's resilience to global risks by creating a less productive workforce, a population susceptible to the spread of disease, and potential instability due to risk of social unrest," it said.

    As per the report, four countries -- Somalia, Sudan, Afghanistan and DR Congo -- are in the extreme risk category. All these nations are characterised by weak governance, internal conflicts and regional instability, it added.

    "Maplecroft findings indicate that low external debt, energy security, good governance and regime stability are all factors that improve countries' resilience to the conflation impacts of global risks," Maplecroft's CEO Alyson Warhurst said.
  3. Rage

    Rage DFI TEAM Stars and Ambassadors

    Feb 23, 2009
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    It's true!! Until they deal with the Maoist menace, completely reform the police and the anti-insurgent squads, India will always remain a high-return, but high-risk <in terms of perceived expected returns> economy. Until then, our industrial heartland will never be fully developed. And until then, we will be a primarily consumption and service-oriented, rapidly, but marginally industrializing, growth oriented but disequilibriating economy.
  4. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

    Nov 16, 2009
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    This is going to get much overrated in future unless strong assurances are made & are followed by strict actions regardless of its consequences on political calculations.

    Indian industrialists have worked enough all since 2001 Indo-pak standoff, to keep the economic atmosphere calm for investments & its functioning. But much more is required for regions which are still off the growth current.

    Having said that, Maplecroft's parameters & their estimation is laughable. I'd like to do a cross-tab analysis of these ratings against investments made in 2011.
  5. The Messiah

    The Messiah Bow Before Me! Elite Member

    Aug 25, 2010
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    They have yet to grasp the Indian "chalta hai" attitude!

    When there's money to be made there will always be a way in this country.
  6. nitesh

    nitesh Mob Control Manager Stars and Ambassadors

    Feb 12, 2009
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    I just say to maplecroft people, just make sure you don't invest in India.

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