Finance Minister Nirmala Sitharaman has said economic policies of a country may not be enough to attract companies, warning that the possibility of acts of terrorism will become a crucial input in a firm's decision-making matrix.
"Businesses can no longer be attracted by just policies or by just openness of an economy. They are also going to factor in the magnet that is going to attract terrorist targeting," the finance minister said on October 20.
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"It is no longer an occasional attack or no longer only one region that is repeatedly a terrorism target. It is anybody, anywhere, single or well-organised. And that level of uncertainty and that level of risk which comes into business decision-making or investments is going to be a permanent uncertainty and high-cost risk," she added.
The comments by the finance minister, who was speaking at the Kautilya Economic Conclave in New Delhi, come amid increasing instances of geo-political conflicts, wars, and terror attacks, including the Russia-Ukraine war and the Israel-Hamas conflict.
One of the spillover effects of these conflicts has been a rise in global commodity prices, including those of energy and food products. According to Sitharaman, food security should not become an instrument during times of war.
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"It's ironic that we are talking food security in the 21st century... at least for some staples and essentials there should be a regional balance that you need, if not a country-wide balance," the minister said. "If you depend on global sourcing, you also have to factor in global risks. And can any one region or country afford to have food at that risk level?"
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