India Inc runs for terror insurance cover
From hiring more security personnel to increased spending on security gadgets, Indian companies have seen their security expenses rise sharply in recent years, experts said.business Updated: Jul 30, 2008 00:26 IST
Last week’s serial bombings in Bangalore and Ahmedabad has put the spotlight on the security preparedness of corporate India, which is increasingly becoming a target for terror groups that envy this South Asian nation’s emergence as an economic powerhouse.
“Security management” and “terror insurance cover” have lately become boardroom buzzwords. From hiring more security personnel to increased spending on security gadgets and insurance against terror attacks, Indian companies have seen their security expenses rise sharply in recent years, experts said.
A recent survey by the Mahindra Special Services Group showed that an overwhelming 97 per cent of companies in the country view security as an area of increasing priority.
Those concerns, in turn, have helped generate much business for companies like Group 4 Securitas, which now has 1,50,000 trained guards and is the country’s second largest private sector employer.
Although no firm figure is available on how much companies spend on security, an industry observer said a medium size corporation spends about Rs 7 crore annually on services of a private security agency.
There are 5 million private guards in the country and the private security industry is valued at Rs 10,000 crore.
Capt Raghu Raman, CEO Mahindra Special Services Group, said more and more corporations would opt for protecting their employees and establishments through insurance cover.
“The number of individuals opting for terrorism insurance is on the rise due to heightened awareness, especially in sensitive terror prone geographies,” said Anuj Gulati, director of ICICI Lombard.
The latest terror attacks have also renewed demand for government protection.
“Wherever there is a terrorist threat perception, every citizen has the right to have armed protection,” said T Mohandas Pai, director, human resources, Infosys Technologies. “While the public sector is allowed to have armed protection by government agencies, the same thing is not allowed to the private sector under the current legal structure.”
Home Minister Shivraj Patil has said the government is ready to amend its laws to allow the Central Industrial Security Force to provide service to private companies, especially those in the information technology sector — a symbol of India’s economic prowess and therefore a potential target for terror attacks.